It’s a question many non-lawyers may have known for a long time. There are simply too many lawyers, according to a survey conducted that showed lawyers are simply not busy enough.
Ttanslated: too many of them.
The Altman Weil survey released on Tuesday was conducted among 320 managing partners and law firm chairmen and probably confirmed what many in the general populace felt was the case and had been the case for some time.
However since the global financial crisis law firms have been up against things with new work, more competition, more aggressive clients seeking fee deals and a slowdown in some areas of law.
The Altman Weil survey found that 60 percent of those surveyed said over capacity was reducing their profitability. However for over 250 attorneys the problem was worse because 74 percent of leaders said the attorney idleness was hurting profits.
Some of the results:
Bloomberg report that most of the firms surveyed weren’t doing much to make themselves less cumbersome, however. Just 43 percent of partners and chairmen said they had changed their staffing situation, despite the fact that, according to Altman Weil, the ones that had cut back in the past were more likely to see profit per equity partner rise than the ones that maintained the status quo.
Another problem is the amount of work being taken by inhouse counsel in the corporations. Ninety percent of firm leaders said companies’ own lawyers were already cutting into outside counsel hours, or threatening to.
The growing clout of in-house counsel may be a sign that companies are responding proactively to ballooning regulations, says Jeremy Paul, the dean of Northeastern University’s School of Law. “As the regulatory state increases, the reaction to it is much more building it into the structure of your business, rather than not worrying about it and only going to outside lawyers,” Paul says.
Source: Altman Weil / Bloomberg
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