In the latest Thomson Reuters Institute Insights podcast, we dive deep into the recent “2023 Report on the State of the Legal Market” to set the stage for what may be a very challenging year in the legal industry
By now you may be well familiar with the recently published 2023 Report on the State of the Legal Market, produced by the Thomson Reuters Institute and the Georgetown Law Center. It’s a must-read that imparts an informed start to what looks to be a potentially challenging year for law firm leaders.
In the most recent Thomson Reuters Institute Insights podcast, available on the Thomson Reuters Institute Insights podcast channel, we dug a bit deeper into some of the themes discussed in the report, and in particular some of the things that media coverage may have overlooked, with Jim Jones, Senior Fellow at the Center for the Study of the Legal Profession at the Georgetown Law Center and the report’s chief author.
Following the surprisingly strong performance of 2020 and the outstanding results firms experienced in 2021, the downturn of 2022 was not unexpected, yet was still understandably troubling for many law firm leaders.
While the report has garnered widespread media coverage, this podcast is one of the relatively few opportunities to hear directly from the author on what may lay behind some of the headlines. For example, much of the media coverage has gravitated toward the findings from this year’s report that the average lawyer produced roughly $98,000 less in fees for their firm in 2022 compared to 2007 due to declining productivity. In this podcast, we discuss why that may be the case and what law firms may be able to do about it.
The topic of mobile demand, another key theme from the report, is also revisited. Clients seem intent on continuing to explore ways to optimize the distribution of their outside legal work to maximize return while controlling costs. As a result, the continued migration of work throughout the legal market, and especially downwind to lower cost legal service providers, seems likely to continue.
Jones also shares his thoughts on why he is a bit surprised that so much of the media coverage of this report has focused on the negative aspects of law firms’ financial performance in 2022. “There is the problem of the ‘what have you done for me lately’ attitude,” Jones says. “When you’ve gone through a couple years of real economic success, whenever there’s a dip after that, it feels like civilization is coming apart, when actually it could be a return to a more normal level of performance, which could, in fact, be what’s happening.”
Following the surprisingly strong performance of 2020 and the outstanding results firms experienced in 2021, the downturn of 2022 was not unexpected, yet was still understandably troubling for many law firm leaders. As firms look to set or even perhaps re-examine strategic goals going into 2023, beginning that exploration with as complete a picture of the current state of affairs in the legal market and what the near future may hold will help leaders arrive at the strategies that could yield more favorable results.
You can hear all about the “2023 Report on the State of the Legal Market” with Jim Jones here, on the most recent Thomson Reuters Institute Insights podcast.