The Lawyer's latest law firm business confidence survey, conducted by Wheeler Associates, makes for sober reading.
The number of firms expecting their fees to grow over the next six months is down. Only 35 per cent of the managing partners surveyed expect their firms' turnovers to grow over the next six months. This compares with 66 per cent in the previous quarter. Average fee growth across all firms in the survey is predicted to be 3 per cent over the next six months - down from 7 per cent in Q2. Unsurprisingly, confidence in the UK economy has collapsed since the last quarter. Nearly all (92 per cent) managing partners believe that prospects for the UK economy will worsen over the next six months. Indeed, recession is the biggest issue of concern to managing partners. Kevin Wheeler of Wheeler Assoc-iates said: "Six months ago, managing partners were also concerned about a possible recession, but a more immediate issue for them was their ability to attract good lawyers to do the work that they already had, and the high salaries they were having to pay to do so. "Their concerns now reflect the issues associated with an economic downturn, namely late payment by clients, fee pressures, increased competition for work, and higher levels of working capital." The research sample comprised 65 managing partners from The Lawyer 100 firms. City firms accounted for two thirds of the sample. Fieldwork for the third quarter survey began the week after the terrorist attacks in the US. Further findings of the report, including profitability analysis, staffing levels, client relationship management practices and strategies to protect revenues, will be revealed at a breakfast briefing tomorrow (9 October).