Law firm demand up, but so is headcount
The market for law firm services hit a slight turbulent patch in the second quarter. The Peer Monitor Economic Index (PMI) dipped one point to 55. While demand for legal services was up 0.4 percent compared with a year ago, productivity fell 0.8 percent as firms added headcount in excess of demand.
Transactional practices (corporate work, tax, real estate) continued to perform well, making up for continued weakness in litigation. But headcount growth reached its highest level in two years as firms continue to accelerate hiring ahead of demand growth.
The second quarter report says the remainder of the year could be challenging as firms make their way through the traditionally slower summer months and end-of-year holiday season.