Nancy Reiner, Managing Director for the Boston office of legal search firm Major Lindsey & Africa writes in the Boston Globe about her views on the year ahead for the law business. Up or down? So far as Masswachusetts is concerned, things are looking good.
Massachusetts added 50,000 jobs during 2011 and unemployment fell to 7 percent, its lowest level since the end of 2008. In fact, according to The Boston Globe, the state added jobs at more than double the pace of the nation this past year. Employment in the state’s information services sector grew by 5 percent; professional services (which includes law firms) expanded by 4 percent; hospitality and health care grew by 3.6 and 3 percent, respectively; and manufacturing (led by technical equipment companies) expanded by 2 percent.
In November, the Associated Industries of Massachusetts Business Confidence Index turned positive – reaching 50.1 – for the first time since July. In mid-December, Suffolk University’s Beacon Hill Institute predicted that the state’s economy will grow by 2.8% and 65,000 jobs in 2012.
We at Major, Lindsey & Africa have experienced this first-hand: We made 37 percent more global law firm placements in 2011 than in 2010.
There are some potential clouds on the horizon that could slow the state’s growth, though. One is the global economy. Since many of the Commonwealth’s businesses sell their products and services overseas, Europe’s financial problems could have a negative ripple effect. There is also uncertainty concerning decisions being made in Washington, D.C. that could affect the state’s health care and defense industries. However, these are passing clouds. Massachusetts’ economy is grounded by strong industries, research-oriented universities and hospitals, and cutting-edge technologies, all of which bodes well for legal hiring as we head into the new year.
Hot Sectors Create Demand
Massachusetts, like the rest of the world, is seeing an uptick in demand for attorneys in the following areas: intellectual property, patent litigation, venture capital, private equity, health care, labor and employment, and corporate governance.
The state’s leadership in high tech and pharmaceutical research and development has created a significant need for skilled attorneys. Electrical engineering, computer software, life sciences, and medical devices are also hot areas that contribute to greater legal needs here. A good indicator that this sector’s growth has legs is the Eliassen Group Contract Technology Jobs Index showing a 28 percent increase in the hiring of technology contract workers in Boston through September 2011 compared to the same period in 2010. As a result, there has been increased demand for IP and patent associates, as well as a number of high-profile lateral partner moves in the areas of patent strategies, litigation and legislation. Massachusetts should also benefit from the rise in clean, green alternative energy programs and products.
New accounting requirements calling for greater transparency under the Securities Exchange Act of 1934 and anti-bribery provisions included in the Foreign Corrupt Practices Act (FCPA) are also leading to more legal work. White collar legal work is increasing as the government launches more investigations into financial fraud allegations. Consumer finance and lender litigation cases are also on the rise in the wake of the housing market meltdown and mortgage industry’s troubles.
Labor and employment cases will continue to increase, with the hottest areas focusing on fair pay, discrimination and wrongful termination investigations, and collective bargaining disputes involving public sector employees. Legal issues that arise out of the federal and Massachusetts health care reform laws will provide more work for lawyers.
Corporate governance is also on the radar, making both in-house counsel and outside advisors more crucial. Increased scrutiny is coming from both shareholders and federal regulators. The SEC has expanded the legal definition of “risk” and is calling for greater transparency in everything from executive compensation to succession planning.
Other areas that will likely be busy for attorneys include social media liability, attorney-client privilege, and management oversight within corporations. There also seems to be a greater need for legal help with licensing issues, mergers and acquisitions, and compliance matters.
In-house corporate legal departments will continue to try to reduce legal costs and gain greater control over their outside law firms. Many are expected to reduce the number of law firms with whom they work. In an effort to create greater staffing predictability and fee flexibility, both in-house legal departments and law firms will outsource an increasing amount of legal work. They will turn to staffing companies, like our affiliate firm Inside Edge Legal, that can provide them with highly-qualified contract attorneys on an interim basis. These assignments will include complex substantive work in specialized areas as well as project-based legal work, providing opportunities for skilled attorneys looking for more flexible schedules.