How the Legal Industry has Bounced Back

In this article, we discuss how the Legal Industry in Australia is bouncing back in the wake of the Covid-19 pandemic. We discuss what’s changed and how our way of working will never be the same.

When Covid-19 arrived in Australia, Victorian government restrictions were implemented. The uncertainty around the impact of the virus and the impact on the economy made most business owner’s heads spin. Firms quickly pivoted to work from home, they automated paper based systems and looked to prioritise the protection of the health of their staff and their clients.

Expecting a huge impact on client demand, many firms also moved quickly to protect their cash flow by asking staff to:-

Some even implemented redundancies and restructures.

Many firms managed to maintain their productivity levels whilst working from home and have embraced the flexible future this offers. Some have embraced the opportunity for creative problem solving and innovation.

According to the Australian Financial review, the law firms of Australia managed to mostly hang on to their profits when the economy went into recession in 2020.

The AFR reports that 80% of firms have reported stable earnings or a modest increase in profits. The average growth was 7%. AFR subscribers can read the full article here.

What’s Coming Next?

The CommBank Legal Market Pulse survey published in November 2020 suggests that firms further expect another 5-6% growth in profits during 2021.

This growth in profits is positioned against cut backs in some areas of spending including business related travel and client entertaining.

Firms are also rethinking their office space spending. Whilst they need room enough to spread out, many are moving to hybrid models where staff only work 60% in the office. This potentially frees up floor space or offers the opportunity to consolidate multiple sites.

Staying Digital

Prior to 2020, many firms had been investing in technology to help them remove paper based processes and this has certainly paid off this year. These are the firms that switched to work from home models with relative ease.

Clients have also realized the value in video conferencing and how it can save them time and money. Virtual meetings are well and truly here to stay in the future of the legal industry.

Iso-placements also evolved during the year for recruitment and are most likely here to stay in some shape or another. Whilst we had always offered video interviews, we (and our candidates and hiring managers) really up-skilled in this area and have learnt how to watch for body language and read between the lines via a screen. Companies have managed to shave days off their time to recruit by responding quickly to talented candidates with letters of offer. They have also managed to induct them into roles virtually.

People First

As we look back on 2020, there will be stories told of what businesses did to maintain productivity, sanity and a hold on their positive culture during the pandemic. Businesses acknowledged that staff were juggling their workloads with responsibilities at home, including navigating remote learning for school aged children, assisting elderly family members with access to essentials and adjusting to the very restrictive stage 4 lockdown. Some firms have outdone themselves, with this example from Herbert Smith Freehills looming large.

Companies that understood the need to check in with staff that were living on their own, or had challenging home life circumstances will have earned themselves significant company loyalty. Many implemented new wellness programs and boosted communications to stay connected with their staff. Some invested in significant workforce training and development.

These are the employers we are expecting to see on candidate’s employer wish list in the next few years.

Heading Back to the Office

In January and February of 2021 firms will move to have 25%-50% of their workforce return to the office. The Melbourne CBD will start to look more like itself and less like a ghost town. Many companies are asking for volunteers who want to go back to be the first round and some people will jump at the chance to look at a different four walls and to see the faces of their colleagues in real life. Others are more reluctant and firms will have to manage this anxiety for their personal health and concern about safety until a vaccine is widely adopted.

At Legal People we have seen continued demand during the pandemic for senior to mid-level lawyers and law clerks. This is usually followed by a spike in demand for support staff, so we expect this is still coming. We have heard stories during lockdown of partners and senior associates doing more of their administration work themselves… so perhaps there will be a new found respect for the work done by support staff!

With news that Australia’s 2020 recession was over quickly and consumer confidence starting to rise on the back of low case numbers and Melbourne’s suppression achievements, we are expecting a busy year in 2021.

It’s a good time to be in the legal industry, with an ongoing digital transformation underway and employers understanding better than ever the value of their people.

It is great to take the learnings from lockdown and to keep the innovative solutions that actually created efficiencies and connections into the long term.

The legal industry has bounced back from the pandemic with resilience, new skills, a proven flexible way of working and tried and tested disaster recovery systems. The future is bright and we are pleased to be part of it.

Are you looking for a highly talented legal services staff? Legal People is your gateway to legal talent. We are specialists in the Legal Industry. We recruit Lawyers, Support staff and HR professionals in Melbourne, Australia. If you enjoyed reading this article, you can follow our Company Page on LinkedIn for regular updates. To browse our currently available roles click here.