State of the UK Legal Market 2023: Top Takeaways
Nearly half (45%) of UK companies shifted work to different law firms in the past year. That’s among the findings of State of the UK Legal Market report, which showed demand challenges as well as increasing competition within the supply side of the legal marketplace.
Legal Current examined the report, released today by Thomson Reuters, and shares key takeaways.
- Nearly a quarter (24%) of UK legal buyers forecast increase in spend for employment advice, yet 28% expect a drop in demand for M&A legal advice. These figures are to be expected during an economic slowdown. The anticipated uptick in demand for advice on employment law comes as rising inflation and interest rates forced companies to reduce headcount, driving an increase in demand for employment lawyers to help navigate redundancy programs. In addition, the economic slowdown and reduction in dealmaking means 28% of corporates expect a drop in demand for legal advice on M&A deals.
- Corporates are highly active in shifting work between law firms. The 45% of companies that shifted work to different law firms in the last 12 months said they adjusted their law firm rosters to either work with a new firm or use another firm substantially more. This mirrors a global phenomenon; 50% of legal buyers globally adjusted their list of firms with whom they work.
- Regulatory complexities and cost control are top strategic priorities. Corporate in-house law teams view regulatory complexity as the number-one risk on the horizon. While 22% of in-house teams view compliance/regulation as a current priority, 30% view it as a future risk, making it the top risk on the horizon. This focus on regulatory work is reflected in spending intentions, with 31% of corporates anticipating growth in budgets allocated to regulatory work. Beyond regulatory complexity, cost control is the second-highest strategic priority, cited by 25% of in-house legal teams.
For more takeaways and insight into the UK legal market, download the report.