Is it game over for law firms? Or is this a once-in-a-generation opportunity to change and grow? The second iteration of the LexisNexis Gross Legal Product tracks the peaks and troughs of demand across the legal market. It highlights the areas that are most hit by COVID-19 and those with the most to gain.
LONDON, 10th December 2020. Today, LexisNexis has released the latest version of the Gross Legal Product index. Just as GDP measures a basket of goods and services that track the level of output in the overall economy, the Gross Legal Product Index (GLP) tracks a basket of metrics which are representative of legal activity levels. Following the same measures over time shows how demand in the Legal sector changes over time.
The Q1 report (https://www.lexisnexis.co.uk/GrossLegalProductIndex) painted a bleak picture for legal services as COVID-19 dug deep scars across the industry. The Q2 report continues to tell the same story. Some areas of the legal market have found renewed opportunity whilst other areas are in harsh decline. Property, Immigration, Crime and Litigation are the hardest hit sectors of the market and contributed to an overall legal market decline of 6.9% to the end of June. However, all is not lost.
Previously strong practice areas such as Employment, Tax and Commercial continues to show growth, but at a slower pace than Q1. With the furlough scheme fully embedded, Employment law rides high, enjoying 4% growth. The rapid change to new ways of working and inevitable restructures are likely to keep Employment lawyers busy for the foreseeable future. Tax, too, has seen healthy growth, enjoying the rush of work from the furlough scheme and government backed loans. With tax changes inevitable, the 13.9% growth as entering Q3, is likely to be a sign of things to come.
The expected boom in Restructuring and Insolvency (R&I) hadn’t materialised midway through the year. The GLP suggests that businesses have been stabilised by government support and fewer are failing in comparison to 2019. As such, the R&I practice area has declined 18.4%.
Unsurprisingly, the spring lockdown was devastating for conveyancers. The model shows that Property work was 31% lower than in 2019. Time will tell if the stamp duty holiday and pent up demand translates into recovery. Property, however, is not the worst performing practice area. The closure of courts has seen Litigation continue to take a hammering – dropping between 20 and 30% since 2019. The model predicts that whilst there is likely to be pent up demand, the bounce back is likely to be small and short.
Chris O’Connor, Head of Segment Marketing at LexisNexis and author of the report, said “The report has brought data and insight to the legal industry. Complicated and difficult decisions lie ahead.”
Chris continued, “The GLP will give firms the chance to review their market positioning, see how they are performing and chart a route to future growth.”
The Q2 2020 GLP report includes an automated survey tool that allows firms to generate bespoke reports, comparing firm performance against the market, with tailored suggestions to help grow business. The interactive report can be accessed from: https://www.lexisnexis.co.uk/research-and-reports/lexisNexis...
About LexisNexis Legal & Professional
LexisNexis Legal & Professional is a leading global provider of legal, regulatory and business information and analytics that help customers increase productivity, improve decision-making and outcomes, and advance the rule of law around the world. As a digital pioneer, the company was the first to bring legal and business information online with its Lexis® and Nexis® services. LexisNexis Legal & Professional, which serves customers in more than 150 countries with 10,600 employees worldwide, is part of RELX, a global provider of information-based analytics and decision tools for professional and business customers.
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