A wave of rightsizing is washing over the legal industry, according to a new mid-year analysis by Leopard Solutions. Following a period of rapid growth, law firms are now prioritizing efficiency and profitability, leading to several key trends:
Fears of a recession are prompting firms to scale back on corporate attorney hiring, a stark contrast to the previous two years. This shift towards cost-effectiveness suggests a period of consolidation for the legal sector.
- Diversity Stalls at the Top
While women have made strides in associate positions, the landscape remains largely unchanged for ethnically diverse partners. With only 12.7% of partners in the top 200 firms meeting Leopard Solutions' criteria for ethnic diversity, the need for continued efforts to promote inclusion at the highest levels is more pressing than ever.
Overall lateral hiring is on track to surpass 2023 levels, driven by departures in key practice areas like Real Estate and Corporate. This upswing reflects an increased focus on acquiring experienced talent to bolster existing teams.
Entry-level hiring has declined significantly compared to 2023. This suggests a preference for experienced lawyers over building new associate classes as firms prioritize immediate returns on investment.
These findings paint a picture of a legal industry in flux. While the rightsizing movement presents challenges, it also offers opportunities for firms to optimize their operations and focus on core competencies. Law firms can effectively navigate this evolving landscape by actively leveraging data-driven insights to inform and guide their strategic decisions. See the analysis at a glance.
Leopard Solutions reports on the industry's state annually, and the most recent report analyzes trends on the following and is available here.
- The attorney exits by practice areas
- Hiring patterns by diversity
- Entry level vs lateral hiring trends
