Mike Abbott Vice President Michael.Abbott@thomsonreuters.com The « 2022 Australia: State of the Legal Market Report » aptly describes the 2022 financial year as a « story of two halves ». Demand for legal services rose to 6.4% in mid-year before falling into the red. Readers of the report will learn how their colleagues have responded to changing industry demands and evolving customer relationships. Despite the difficulties faced across the continent since the beginning of 2020, Australia`s legal sector has proven to be highly resilient in the face of near-constant change and significant challenges. Over the past two years, Australian law firms have consistently outperformed their global peers. Whether you maintain a full legal library or simply add a single title, we have book purchase options to save you time and money Despite turbulent business conditions, Australian legal market fundamentals look exceptionally strong, with record growth pushing revenue growth to 10.0% for FY 2022 (FY 2022), even if demand slows in the second half of the year. While the rest of the world is embroiled in a costly war for talent, Australia has managed to satisfy its lawyers with their remuneration while relatively controlling the growth in their compensation costs. Bryce Engelland Industry Analyst Bryce.Engelland@thomsonreuters.com To further illustrate this year`s analysis, this infographic highlights how the combination of the above factors has contributed to healthy revenue growth for the Australian legal industry. Australian law schools are also stepping up their legal technology initiatives to train aspiring lawyers with legal technology clinics, competitions, degrees and partnerships. Here are some interesting examples: The evolving intersection of talent and technology is also a notable trend described in the report, as technology can help attract and retain talent. For companies that are investing more in legal technology and expanding its use, working with legal talent is essential. Leaders who seize their opportunity to foster a culture of digital transformation will inspire the next generation of lawyers. Interestingly, law firms` responses to these challenges facing their clients have been different.
Some help their clients develop digital transformation strategies, while others sell technology services directly to customers without the involvement of partners. Other law firms are starting to provide legal services in new ways by developing legal products, often sold as subscription services. Choosing the right technology that solves the problem and fits into a company`s culture is an important first step to successful technology deployment, but it also comes with its own challenges. Of the corporate law departments surveyed[16], one in four said they had failed in a legal technology implementation project, and more than half (53%) of these projects failed because the technology was ultimately not suitable. The Rutter Group provides practical and authoritative advice to California and state attorneys. A thriving innovation practice is now an important part of the lawyer engagement equation. According to the Tech and the Law 2022 survey, 29% of lawyers said they would be willing to leave their firm or law firm for a more innovative firm, while 32% said they were unsure. Isaac Brooks, Senior Industry Analyst, Isaac.Brooks@thomsonreuters.com Thomson Reuters Aspatore books, helps you manage your clients and grow your practice.
Immerse yourself in the minds of the best lawyers and executives who demonstrate successful legal strategies. Use legal books, ProView eBooks, and legal software to search court rules by industry and jurisdiction. In fiscal year 2022, Australia`s legal sector experienced a rollercoaster ride of growth and decline in demand, ending with strong revenue growth. The end of the fiscal year is such a strong testament to the solid foundation on which Australian law firms are built; And at the start of the 2023 financial year, Australian law firms have reason to be optimistic. This growing focus on legal technology and innovation has created a highly competitive landscape for legal technology and innovation talent, where it is difficult to attract and retain these multidisciplinary professionals with different career paths than traditional lawyers. Some law firms are even launching graduate programs for legal technology and innovation teams. It`s important to be a trusted advisor to your clients. Streamline your documentary approach with over 200 legally approved documents for business registration, SMSF, deeds, trusts and more. [6] Thomson Reuters Institute « Law Firms Competing for Talent in 2022: Will lawyers stay or will they go? » 2022; Available from www.thomsonreuters.com/en/reports/law-firms-competing-for-talent-in-2022.html.
However, this resilience has recently shown some signs of waning, as the legal world has been plagued by new uncertainty about inflation, international conflicts, and a deep lack of legal talent. This time, as law firms around the world began to weather another storm, the Australian legal market was no exception. Another focus is on the exceptional qualities of lawyers who help make law firms more successful. Given the ongoing legal pressure from talent, companies need to pay close attention to turnover rates. Legal talent turnover is relatively high in Australia; Therefore, companies must prioritize the risk of flight of their service providers. Explore a wide range of legal treatises, including legal books, ProView eBooks, encyclopedias, and legal software. However, the numbers since January 1, 2022 have told a different story. Globally, law firms in all regions except Asia experienced a slowdown in legal demand.
In a reversal of fate, Australian companies actually saw their average demand fall into negative territory for the second half of fiscal 2022. This is remarkable, as Australian companies have vastly outperformed their average global competitors over the past five years. Our latest infographic shows how the Australian legal market has managed to increase revenues for its law firms despite slowing demand and capacity utilization. Some clients of legal services in Australia opt for separate alternative legal advice in addition to their traditional legal advisory boards, which are primarily made up of law firms. Another notable trend is that corporate legal departments are trying to leverage existing in-house technologies to gain benefits that are easier to obtain. This is due in part to the very long lead times required to obtain approval for new technologies, as most enterprise customers meet extensive cybersecurity compliance requirements. Learn about the products lawyers rely on to strengthen the business, practice and study of law This report contains a wealth of information and commentary on the state of our legal services sector. It encourages in-depth reflection on some key issues. What once seemed inspiring to lawyers now risks becoming a cautionary tale – an example of what could happen to law firms that ignore the warning signs and respond to growing threats.
While much of the rest of the legal world faced severe challenges in early 2020 due to the global pandemic, Australia`s legal sector has remained highly resilient in the face of these daunting challenges, outperforming its global peers for most of the past two years. Equally important are the seismic shifts in geopolitics and the global economy that emerged in 2022 in the form of war and inflation. The report highlights the potential impact of these changes on the legal services market in the coming years. Access authoritative advice with comprehensive legal forms, practice papers and law books. Bill Josten Senior Manager – Enterprise Content William.Josten@thomsonreuters.com A recent analysis by Eric Chin of PwC NewLaw found that « half of Australia`s leading law firms have made formal commitments to legal innovation, seven times more than in 2015 ». [9] So what really drives this law firm to invest in legal innovation and technology – and where does the journey go? While Australia`s legal market has remained largely resilient to the worst of the pandemic, its façade could show signs of cracking amid recent turbulence. From Fortune 500 companies to solo general counsel, Legal Tracker can be fully scaled to streamline operations, control expenses, and gain comprehensive insight into your legal operations.