A new survey which looks at the business confidence of law firms has revealed that managing partners are seriously worried about the prospect of a UK recession – but they are nevertheless convinced that their own firm’s prospects are strong.
The survey, conducted by Wheeler Associates in association with The Lawyer, is a first for the UK legal sector. It has found that the larger firms within The Lawyer 100 are more concerned about an impending recession, and that firms with fee incomes greater than £50m are predicting fee growth of 6 per cent as opposed to a prediction of 9 per cent averaged across all firms.
These figures are mirrored by profits predictions, with larger firms once again more concerned about the effect of any slowdown on profitability. However, the largest firms are expecting a growth of around 20 per cent in their international work.
Prospects for fee income are expected to vary widely according to practice area. The strongest growth is envisaged to come from insolvency/corporate recovery (a predicted 12 per cent) and human resources-related advice, such as employment and pensions (10 per cent). The weakest growth is expected to come from corporate finance and e-commerce. In fact, among the largest firms, fee income from both corporate finance and e-commerce is predicted to fall by 2 per cent over the next six months.
Smaller firms have different concerns. The most pressing issue for these firms, with fee income below £20m, is the effect of salary hikes and the ability to recruit good lawyers.