The Hildebrandt Institute’s Peer Monitor Index (PMI) rebounded 6 points to 55 in the first quarter – reversing two consecutive quarterly declines. Demand growth was back on a positive track. However, the good news was dampened by expense growth, which continues to accelerate, reducing firm profitability.

After a weak finish to 2011, demand for legal services was up 1.5% in the first quarter. Litigation, IP-related practices, and labor and employment continue to be positive, while transactional practices were largely flat-to-slightly down.

The current outlook remains cautious. Demand and rate growth, while positive, are still weak. And although the balance between demand and capacity is showing signs of improving, at the moment it remains a drag on law firm market performance.

A copy of the report can be downloaded here.

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