State Capital Group - News & Publications

 

SCG Legal Newsletter
January 2018

 

Legal Employment Improves Slightly in December

The U.S. legal services industry added 600 jobs in the final month of 2017 as the country’s overall economy posted employment gains, the U.S. Department of Labor reported January 5th. The agency’s Bureau of Labor Statistics issued its monthly outlook on the employment situation in the United States, showing that 1,128,200 people were employed last month in legal services during December. The data are provisional and could be revised later. BLS includes lawyers, paralegals, secretaries and other law-related professions in the legal services employment report. The legal services industry’s job figures in December are within a range that has remained relatively the same for the last several years. Since June 2013, the number of people employed in legal services has generally hovered between 1.12 million and 1.13 million, approximately 50,000 fewer jobs than at the industry’s high point in 2007.

 

Record-Breaking Year for Law Firm Mergers

More law firms than ever took the merger plunge last year, seeking to differentiate themselves in a highly competitive market. With 102 firms signing deals, the U.S. legal market had a record-breaking year, beating the previous record of 91. It is the highest annual total of mergers recorded in the 11 years legal consultancy Altman Weil's MergerLine has been keeping such data. The largest combination of the year was a cross-border merger between 500-lawyer U.S. law firm Womble Carlyle and 580-lawyer U.K. firm Bond Dickinson, creating a new 1,000-lawyer transatlantic law firm, reflagged Womble Bond Dickinson. Combinations in 2017 involving law firms with 21 or more lawyers represented 20% of total deals, while 80% were acquisitions of firms with two to 20 lawyers. There was a distinct difference in geographic focus between the two groups. Forty percent of the larger combinations involved international law firms, and another 25% were acquisitions of California law firms. Among the smaller acquisitions of firms with 2 to 20 lawyers, there was greater geographic dispersion overall. The top three inbound destinations for small deals in 2017 were Florida, Texas and New York.

 

Cybersecurity Spending Expected to Rise This Year

Recent surveys by Robert Half Legal reveal that 41% of U.S. lawyers and 35% of Canadian lawyers expect their law firm or company to increase spending on cybersecurity-related tools and services in the next 12 months, due largely to the high volume of sensitive information they maintain. “One can consider the significant volume of valuable client data they hold for companies and organizations of all sizes – intellectual property agreements, contracts, customer, supplier and financial information, research on potential corporate mergers, and evidence in potentially high-stakes litigation cases,” said Jamy Sullivan, executive director of Robert Half Legal. “If this valuable and confidential information falls into the wrong hands, it could prove costly to a law firm as well as its clients, and also cause irreparable damage to brand and reputation.” Gartner has released its own enterprise study that predicts global spending on cybersecurity will exceed $96 billion in 2018 – up by $10 billion over last year. Moreover, Gartner forecasts that security testing, information technology outsourcing, and security information and event management will be among the fastest-growing security sub-segments in the infrastructure protection and security services segments.

 

Interest in Attending Law School Returning

Law school applications are up and interest in the law as a profession is starting to rebound, the first trend in that direction since the 2008 turndown. There are several theories for the rise: the political climate has underscored legal issues; the economy and the legal job market have both recovered; and law schools are continuing to offer discounts to lure top students. The dean of Fordham Law School Dean Matthew Diller attributes some of the 20% increase in applications that school has experienced to a renewed appreciation of the importance of law and lawyers in a functioning democracy. The total number of law school applications for next fall is up more than 11% over last year. The number of applicants could reach 63,000, the highest figure in five years, but still far below pre-recession highs.

 

 

 

 

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