Your law firm could increase its revenue by 3.5% by 2021
Over the past half year, law firms have been forced to implement numerous strategies to address the challenges due to the devastating effects of COVID-19, leading to a sharp improvement in law firm performance, according to the Peer Monitor Index report by Thomson Reuters
Specifically, law firms increased their net revenues by 9.9% at the end of the fourth quarter of 2020.
Demand for law firm services continues to decline, but was only 0.3% lower than in the fourth quarter of 2019. Demand for legal services declined sharply during the second quarter of last year, figures that have been gradually recovering.
The fourth quarter of 2020 saw an upturn in revenues, fees and productivity. Law firms have reduced costs, mainly related to office expenses and business development.
Recruitment of new lawyers was also reduced and, in fact, firms have employed 1.6% fewer lawyers than during 2019.
In terms of profitability, firms in 2020 increased their profitability by an average of 11.5% in the fourth quarter.
This report predicts that during the current year, firms will, on average, increase their revenues by 3.5%.
"Proactive fee strategies, aggressive cost cutting, successful remote working models and increased investment in productivity-enhancing technologies have helped produce positive results in the face of unprecedented challenges," said Mike Abbott, vice president of Market Insights and Thought Leadership at Thomson Reuters.