Despite being a topic of frequent discussion in recent times, the concept of the “new normal” has yet to fully take root. Over the past few years, it has become increasingly clear that the events of the past didn’t necessarily initiate new trends, but rather hastened the pace of existing ones.
Let’s explore how three particular legal industry trends—talent management, technology adoption, and real estate strategies—have impacted the legal industry and reverberated across various sectors beyond law.
Talent Acquisition Struggles
There’s no denying the reality of what’s been termed “The Great Resignation,” is affecting industries far and wide, including law firms. While the market has calmed a bit since, reports from 2021 revealed a staggering 150% surge in job openings at law firms compared to pre-crisis levels. More recently, A 2024 Thompson Reuters report indicated that firms are struggling to control costs inflated by salary increases and hiring trends. If not addressed, these challenges could complicate plans for growth and expansion.
Firms have begun adapting to these talent acquisition struggles by focusing less on traditional pedigree markers, like law school attended, and more on candidates’ achievements and capabilities. It underscores the importance of maximizing billable hours and enhancing efficiency within firms. Legal process outsourcing, supported by technology investments, has proven to be a fruitful avenue for achieving these goals.
Continued Investment in Legal Technology
Ernest Hemingway wrote that one goes broke two ways, “gradually, and then suddenly.” Change often operates by those same rules.
The legal industry’s adoption of technology has followed a similar trajectory, with the pandemic only accelerating the pace of change. Law firms were embracing technologies that facilitated remote work and digital collaboration long before there was a “new normal” to benchmark the before and after, with automation and efficiency becoming paramount.
Investments in technology-driven solutions, such as Access Unify™ | Active File Service, have streamlined processes by greatly reducing the amount of time it takes to locate documents, empowering staff to focus more on high-value tasks. The shift has not only enhanced productivity but also improved client experiences, ultimately benefiting the firm’s bottom line in terms of bill-back capabilities.
This legal industry trend is likely to diversify the opportunities available at law firms, as well as provide additional collaboration and support that lawyers need to do their jobs well—and from any location.
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Shifts in Real Estate Dynamics
Surveys suggest that the future of work will likely be hybrid, with only a small percentage of companies opting for fully remote or in-person setups. A survey from the American Bar Association shows that most workplaces—87 percent—allow legal professionals to work remotely, while only 30 percent do so almost all of the time. As preferences for remote work have surged among lawyers, the legal sector anticipates a decrease in time spent in physical offices, prompting firms to reconsider their real estate investments.
Even before the pandemic, there was a trend towards optimizing real estate costs within the legal industry. Now, firms are reassessing their office layouts and space utilization strategies to accommodate hybrid work models and to reduce overhead costs.
Strategies for real estate investment go hand in hand with both technology and talent investments. Supporting a reduced or distributed workforce will inform how firms plan to spend their budgets. After all, an active file room is an expensive use of real estate if it’s just used for paperwork rather than generating revenue like another attorney’s desk space would.
Capitalizing on Intersecting Trends
Law firms are poised to leverage these interconnected trends to their advantage. Whether addressing talent shortages, adapting to hybrid work models, or optimizing real estate investments, technology plays a pivotal role.
For instance, if a firm is suffering from a shortage of staff, the smart move is to invest in technology that supports hiring staff from anywhere, so the talent pool becomes exponentially larger, while making the existing team more efficient. At the same time, they can recoup their investment by shifting their office layout to maximize the use of the space they have and even consider downsizing.
Likewise, if they are moving toward a hybrid model of work with a distributed legal team, technology will become paramount to enabling team collaboration. Active case files stored in an office file room are no help to someone halfway across the country.
In conclusion, the evolving landscape presents both challenges and opportunities for the legal industry. Sustained success demands a willingness to embrace innovative approaches to the delivery of legal services in a market that no longer rewards many of the traditional ways of doing things. By embracing technological advancements and reimagining traditional practices, firms can position themselves for success in the “new normal.”
Continue to learn strategies for addressing these challenges through effective records and information management practices with the help of our eBook: The Modern Law Firm’s Guide to Records Management
