- Record growth: Considered one of the strongest years in a decade for the Australian legal market.
- Split pack: The “Big 8”, Large law firms and Midsized law firms “ran their own race” in the financial year 2026.
- Right people, right tools: Technology spending led the way per qualified fee earner when it came to indirect expenditure, as firms continued equipping their people with the latest tools.
The Thomson Reuters Institute has today released the Australia State of the Legal Market 2026 Edition, in partnership with Melbourne Law School. According to the report, the Australian legal market recorded one of its strongest years of growth.
This year’s edition comprises an analysis of three distinct legal segments. They are the “Big 8”, Large law firms and Midsized law firms. Although they are running the same track, as the report notes; they are speeding towards different goals.
2026 financial year “reflects an unusual balance”
Professor Michelle Foster, Dean, Melbourne Law School said the 2026 financial year (FY 2026) “reflects an unusual balance, in which global instability generated work for Australian firms without unsettling the domestic economy on which that work depends.
“As geopolitical pressures continue to impact economic conditions, it is more important than ever for firms to review core strategies and ensure objectives remain aligned with the changing landscape” (see page 2).
FAQs
What you want to know about the Australia State of the Legal Market (2026 Edition)…
Was FY 2026 a strong year for the legal market?
Yes, according to the Australia State of the Legal Market 2026 Edition, FY 2026 “was one of the strongest years the Australian legal market has seen in a decade” (see page 3). But that does not mean each firm experienced the same levels of demand for legal services, nor that they employed the same strategies to secure their success.
This year’s report contrasts “The Big 8’s” strategies to Midsized firms as they speed towards differing goals. Find out more within your copy of the report.
How much did firms invest in technology last financial year?
We know that firms increased their spending on technology per qualified fee earner in FY 2026, which the report categorises as “indirect expenses”. As it notes, “The sheer volume of spending puts it into perspective, with the 10 heaviest technology & KM spenders investing close to $30 million each” (see page 7).
What methodology underpins the Australia State of the Legal Market 2026 Edition?
Over the course of FY 2026, the financial metrics in this report were collected from Thomson Reuters Financial Insights data, which is based on the accounting systems from 27 participating law firms operating in Australia. These include some of the largest firms by the number of qualified fee-earners (QFEs) in the country.
Global metrics used for comparison are based on 260-plus law firms, primarily located in the United States and the United Kingdom, which also participate in the Financial Insights program. Some numbers may have changed since the issuance of the FY 2025 report due to sample shifts, revisions, or changes in methodology.
Market insights included in the report were based on interviews with 109 Australian-based legal buyers over the course of FY 2026.
Where can I access last years’ edition of the Australia State of the Legal Market?
Download Australia State of the Legal Market 2026 Edition on Legal Insight today.
