2022 Report on the State of the Midsize Legal Market: Four Takeaways
Midsize firms are seeing a resurgence in demand growth by positioning themselves as strategic alternatives to larger firms. That’s among the findings of the 2022 Report on the State of the Midsize Legal Market from the Thomson Reuters Institute.
Legal Current shares top takeaways from the report, which found competitive rates and cost structure are helping midsize firms win more business.
- Demand grew for midsize firms. Midsize firms saw demand grow 1.7% on average through the first six months of 2022, nearly matching Am Law Second Hundred firms, which grew 1.8%, and ahead of Am Law 100 firms, which saw growth of 1.1%. Midsize firms grew litigation 1.2%. Labor and employment, and real estate were even stronger, up 2.5% and 6.5%, respectively.
- Midsize firms had lower worked rate growth than larger firms. This may have contributed to the strong demand growth, as the lower rate growth may have heightened the appeal of midsize firms to increasingly cost-conscious clients. Also, midsize firms had better productivity figures than larger firms, as restrained lawyer headcount growth helped them better manage capacity against available work.
- Technology spend is accelerating. Technology spending grew 9.1% in the second quarter of 2022, as calculated on a rolling 12-month basis – a sizeable jump from the 4.6% growth seen a year earlier.
- Competition for talent continues. Firms of all sizes are challenged to attract and retain talent. But by focusing on retention factors besides compensation, such as creating firm cultures that promote work satisfaction, midsize firms can compete for talent without necessarily having to match the salaries offered by larger firms.
Download the report for more details on the midsize legal market.