Law students are feeling the impact of the current turmoil in the legal industry according to a major LexisNexis survey. The poll shows that a majority of current law school students feel ill-equipped for the business of law, and many are considering alternative careers as a result of the uncertain future of the legal industry.
Results from the100 law students surveyed:
-- 35% of law students responded that they do not feel adequately prepared to succeed in the changing legal marketplace
-- One fifth (21%) of students say that based on the changing legal marketplace, they regret attending law school
"The survey makes for some sobering reading, but there may be an upside," said Mike Walsh, CEO, LexisNexis U.S. Legal Markets. "The data suggests that lawyers on both sides of the table are making changes to navigate this tumultuous time, but to move ahead together as an industry it will require a great deal of communication and collaboration. Law firms that are willing to capitalize on these trends during these times and think and act differently to better meet the needs of their corporate clients could give themselves a competitive edge over their peers."
Nearly three out of four (71%) corporate counsel surveyed say they feel law firms are not doing enough to respond to the current financial pressures on their business model. Steps that have been taken include shifting work in-house and reducing spending on outside counsel.
Almost half the in-house counsel polled (46%) say they have requested rate cuts, yet less than one in five (18%) private practice attorneys say their law firms have reduced billing rates. Meanwhile a large majority (77%) of private practice attorneys are concerned that quality is suffering as a result of too much emphasis on cost-cutting by their clients. Private practice attorneys say their firms have taken a number of steps in 2009 to respond to the changing economic climate, including instituting alternative fee arrangements, reducing staff and imposing hiring freezes.
Despite the considerable impact of the economic recession, just over half of corporate counsel and private practice attorneys believe the recession will permanently change the way business is conducted in the legal industry. Opinions are divided on the future direction of the law firm business model and the billable hour. One area of agreement is that further cuts are predicted by both groups.
-- 57% of corporate counsel believe the billable hour will give way to alternative billing arrangements
-- More than half of corporate counsel say they will shift work in-house (57%) and reduce the amount of their total spend on outside counsel (55%) in 2010
The top two actions private practice attorneys say their firms are most likely to take in 2010 include reducing workforce and deferring start dates for new hires.
The LexisNexis State of the Legal Industry Survey is the first major survey to be conducted on the legal industry since the beginning of the economic crisis. It polled a total of 550 respondents, including 300 law firm lawyers, 150 in-house corporate counsel and 100 law students. The study was fielded by custom research agency TNS. View the complete findings.