Thomson Reuters Law Firm Financial Index: Technology Shines as a Growth Area
Despite gloomy headlines about the Thomson Reuters Q2 2022 Law Firm Financial Index, released earlier this week, the report findings saw “[a]reas of growth shine through,” including technology spending, as the Thomson Reuters Institute and others noted.
The tech spending uptick was highlighted in Reuters Legal by reporter Karen Sloan: “Technology spending was also up almost 11% year-over-year.” And reporter Andrew Maloney noted in Law.com how the report found “a real acceleration in tech spending.”
Legal sector analyst Jordan Furlong emphasized the significance of firms investing in technology in a series of tweets about the report: “Spending on tech is something law firms have been urged to do for nearly two decades. Consultants have been virtually begging firms to move on this. And when firms finally do, suddenly it’s, ‘Oh noes, expenses are up, profits are down!’”
Furlong added, “Law firms are doing exactly what they ought: Investing in technology today to reduce expenses and increase efficiency, effectiveness, and profitability down the line. It’s the ultra-rare example of firms thinking more than one fiscal quarter ahead. Maybe let’s encourage it[.]”
The Thomson Reuters Institute explained how technology spending “grew at its fastest pace in nearly a decade” and why the growth is noteworthy: “Given that IT hardware and services are normally a deflationary market, this is particularly telling of the legal industry’s well-being. This acceleration in investments suggests that firms are keeping their long-term health in mind rather than nursing the bruises of struggling revenue growth in Q2.”
Download the report to learn more about growth in technology spend and the impact on the legal industry.