Pandemic’s effect on the market:
As a result of the pandemic early last year, uptake of candidates increased hugely across the market to cover for the lost time in recruitment. Despite a year characterised by uncertainty, ‘2021 State of the Legal Market in Europe’ report illustrates that law firms were able to grow to a certain extent. This is diverting the market away from a firm driven market to a candidate driven market. As a consequence, candidates are provided with more influence on opportunities. For the purpose of combatting this effect, law firms are emphasising the importance of retention by having to ensure that they provide better benefits and bonuses to employees.
These benefits have extended from simply providing good compensation packages to investing in the individual. This has been exemplified through firms such as Sidley, offering MBA courses, and Kirkland shortening the track to partner. The firms that are following this pattern, such as investing in their employees as people and having a clear message of who they are, are seemingly having a higher employee retention rate.
The pandemic has delivered new challenges and uncertainties as technology has become more crucial to improving efficiency and outcome of a law firm, thus incontrovertibly triggering dramatic changes. For instance, the pandemic has broaden acceptance of remote work and the role technology plays in effectively delivering legal services. As a result, digital adoption is gaining long-term traction in the legal sector, as report illustrates that about 57% law firms are planning to invest in new technologies. The law firms who are adapting to these changes, i.e. those who are introducing more flexible work environment are more likely to do better in the market.
Accordingly, to make its adoption a long-term success, law firms are seeking to make the right hires. They are seeking candidates with backgrounds not simply in law but also with a strong grounding in technology across digital marketing, finance and business development functions. Also, firms are taking more alert approaches to combine technology with hybrid working.
Old generation vs new generation lawyers:
Recent information has shown that there is an apparent difference between the younger and older generation of lawyers within the market. The younger generation of lawyers have portrayed a lesser interest in making partnership within law firms, in comparison to older candidates. For instance, reports portray that 69% of the new generation of lawyers are much less concerned about the value of the status and prestige of being a law firm partner, whilst 55% are not considering long-term legal practice but instead moving in-house.
There is also an established discrepancy between what a younger generation candidate would expect from an employer versus what the employer provides. In light of this, we expect employers to lessen the gap of expectation, via either monetary or qualitative measures, in order to attract and retain talent.
There is a great opportunity for Law Firms to offer more flexibility as attorneys reach different or later stages of their lives in order to combat the talent drain to in-house positions or leaving the industry entirely. Greater appetite from Law Firms for Counsels, Career Associates or Non-Partner Track Associates will ensure they are more competitive in attracting talent and more effective at retaining talent.
How diverse is the legal profession?
Although several surveys demonstrate law firms are taking important steps to increase gender equality, there is still an apparent gap between men and women. In contrast to other industries’, the gender gap of women reaching the level of partnership than men are much wider. Statistics have illustrated that 29% of women are less likely to make partner than men, as law firms face higher attrition among women than men at the equity partner level. Until the equity partner level – where women’s representation drops sharply – its considered that women are relatively well exemplified in the professional.
Even though diversity is a sensitive subject throughout the legal market, it is important in law as it creates a better reflection of society which enables firms and legal departments to better serve their clients. Thus, it is an imperative area which stills needs to be addressed. Reports from 2021 portrays that there has been an increase in diversity across law firms, however, there is still lack of even representation of all candidates, particularly underrepresentation of both women and minorities. As an example, women of colour are particularly experienced steepest decline with their representation dropping significantly at all levels in the profession.
Law firms have been actively tackling the issue of diversity, yet there is still an apparent lack of equal representation of all candidates. It should be noted that diversity needs should be emphasised on the underrepresentation of both women and minorities across the legal market. This is including, not just the initial hiring process of these groups of individuals, but also the track of progression is hindered.
2022 legal recruitment predictions
In 2022 we predict that the legal market will continue to grow as a candidate driven market, increasing the potential for attorneys to climb the legal ladder and move from outside the Top 200 AM firms into the Top 100. We also foresee a hybrid work environment to continue to be pursued across law firms, the gap in diversity to be reduced and greater appetite for senior non-partner talent, as law firms make an active move towards satisfying a candidate driven market while filling their internal productivity needs.