A new survey – A Time for Change: Solicitors Firms in England & Wales – of 2000 English law firms (50% were sole practitioners) conducted by the English Law Society, the Legl Services Board and the Ministry of Justice reveals just how badly High Street law firms are coping with the recession, competition and the changing legal environment.
Some of the key findings thrown up by the research suggest that:
• firms report their most common problems as compliance with regulations (29% of firms)
• responding to competition (23%)
• adapting to changes in legal aid (23%)
• securing finance (21%). Of those reporting problems in securing finance, just over half have experienced problems obtaining bank finance and the remainder with equity funding
• 42% of firms have reported a decrease in turnover in the past three years, compared to 32% reporting an increase and 27% reporting no change.
• Smaller and medium sized firms are significantly more likely to have reported decreases in turnover
• 6% of firms are giving consideration to seeking external investment under ABS provisions
• 64% of firms engaged in media advertising with the most common form of advertising being the internet (54%), followed by local newspapers and magazines (30%)
• 31% of firms currently working with legal aid funded cases were considering withdrawing from one or more areas of legal aid in the next three years, particularly those firms working in family law
The report’s findings also indicate that:
• residential property (48% of firms) and wills, trusts, probate & estate administration (40% of firms) are the most common areas of work. 27% of firms reported that they conducted at least 90% of their activities in a single category of work
• new firms, those with a majority of female partners, firms with a majority of BAME* partners and those doing 50% or more work in crime or immigration reported lower income per fee earner than other firms 1
• 87% of firms outsourced one or more internal or external activities.
* BAME = Black, Asian & Minority Ethnic