{"id":4332,"date":"2020-10-05T21:53:17","date_gmt":"2020-10-05T21:53:17","guid":{"rendered":"https:\/\/insight.thomsonreuters.com.au\/legal\/?post_type=insight_resource&p=4332"},"modified":"2021-09-13T13:44:27","modified_gmt":"2021-09-13T02:44:27","slug":"infographic-4-australian-legal-market-trends-to-monitor","status":"publish","type":"insight_resource","link":"https:\/\/insight.thomsonreuters.com.au\/legal\/resources\/resource\/infographic-4-australian-legal-market-trends-to-monitor","title":{"rendered":"Infographic: 4 Australian Legal Market Trends to Monitor"},"content":{"rendered":"\n

If the legal industry had a global stage – all eyes would be on the Australian market. The newly launched 2020 Australia: State of the Legal Market Report<\/em><\/a> has revealed that law firms in this part of the southern hemisphere are star performers.\u202f <\/h4>\n\n\n\n

According to Thomson Reuters Peer Monitor<\/a>, the dynamic benchmarking platform, Australia recorded strong demand growth over the last three months. The same cannot be said for the US, UK and Asian legal markets, where contractions ensued.\u202f <\/p>\n\n\n\n

When will the lucky country\u2019s good fortune end? As the nation claws through an economic downturn and the health crisis rages on, it seems logical that demand for legal services will tumble once again.\u202f <\/p>\n\n\n\n

Peer Monitor has developed a data-rich infographic on the four trends to watch, which you can download via the form on this page.\u202f  <\/p><\/blockquote><\/figure>\n\n\n\n

To inform our assessment of the future, let\u2019s hear from a Peer Monitor expert, Joe Blackwood. Joe is Senior Thought Leadership Analyst at Peer Monitor in the US and spoke with Legal Insight<\/em> to highlight four market developments that law firm leaders should be following during this unique period.\u202f <\/p>\n\n\n\n

4 Legal Market Trends <\/h2>\n\n\n\n

Trend 1: Australia surpassing major global markets <\/h3>\n\n\n\n

If you\u2019ve read the 2020 Australia: State of the Legal Market Report<\/em><\/a>, you\u2019ll know that the overall demand for legal services during the pandemic did not take a hit. Overall, the market is benefiting from a 6.2% spike in demand activity. To compare the country with larger legal markets such as the US, let\u2019s consider Joe\u2019s summation: <\/p>\n\n\n\n

\u201cUS firms in the Peer Monitor program not only saw demand contraction at home to the tune of 5.9% on average, but they also saw contraction in their UK and Asian offices as well. Asian offices for US-based firms have fared worse, in particular with demand that was down over the period of the pandemic of around 14% compared to the same period the year prior.\u201d <\/p>\n\n\n\n

As it turns out, the trend of decline was to be expected for the US market. Peer Monitor data indicates that it has been a long time coming.\u202f <\/p>\n\n\n\n

\u201cThis drop in performance in Asia for US firms – while concerning – was just a continuation of a pre-existing trend of US firms seeing demand in the region contract for quite some time,\u201d explained Joe. <\/p>\n\n\n\n

Trend 2: Shift in work between lawyer titles <\/h3>\n\n\n\n

Probably the most surprising trend to emerge from the annual report is the one regarding the rise of *worked rates, as law firm Partners are taking up more client work than their colleagues in the associate ranks.\u202f <\/p>\n\n\n\n

\u201cWhat we\u2019re seeing is a shift in the number of hours per month undertaken by Partners compared to all associates. Partners worked six more hours per month in the fourth quarter of 2020 in compared to the same quarter last year, while associates\u2019 hours per lawyer was flat\u201d said Joe. \u201cAs Partners charge much more than associates, the shift in work proportions has lead to a higher average worked rate in the market.\u201d <\/p>\n\n\n\n

\u201cClients are facing a great deal of uncertainty during this shaky time in history that is the pandemic. Law firm Partners are increasingly being called upon to provide more strategic guidance for clients, leading to an increase in their own workloads relative to less experienced associates, and thus prefer to take this on themselves to support business continuity.\u201d <\/p>\n\n\n\n

*What are worked rates? <\/em><\/strong>The Peer Monitor definition for worked rates are reflective of the hourly rate after negotiated discounts from the standard or rack rate.<\/em> <\/p>\n\n\n\n

Trend 3: Practice area hot spots\u202f <\/h3>\n\n\n\n

Not everyone is a winner during the legal profession\u2019s current surge in performance. Demand growth in one area of legal expertise is declining, while others are experiencing unprecedented activity, such as insolvency and restructuring and workplace relations.\u202f <\/p>\n\n\n\n

Unfortunately, demand growth for the construction practice area has taken a hit in the 2020 financial year, understandably so if the decline in building and construction during COVID-19 is anything to go by.\u202f <\/p>\n\n\n\n

As Joe explained, the primary driver of Australia\u2019s demand growth during the global health crisis was none other than dispute resolution.\u202f <\/p>\n\n\n\n

\u201cDispute resolution accounted for 21% of all hours worked and is the largest practice by volume. Over the last couple of financial years, dispute resolution grew by an average of 9.5%.\u202f <\/p>\n\n\n\n

One reason why it did not slow during the pandemic was due to the innovation of the Australian courts, which fortunately already had virtual capabilities in place,\u201d he said.\u202f <\/p>\n\n\n\n

Trend 4: Historic demand growth – will it continue? <\/h3>\n\n\n\n

The final trend among the four in this article is by no means the least important. The Australian legal market has recorded historic demand growth, leaving one to wonder whether it will be short-lived. To allay any concerns you may have, consider Joe\u2019s comments below: <\/p>\n\n\n\n

\u201cHistorically speaking, the Australian legal Market has enjoyed a period of sustained growth since the beginning of 2015, with only four quarters of demand contraction over that time.\u201d <\/p>\n\n\n\n

While we have turned the page to FY 2021, the slight slowdown in demand growth to 4.5% through one month of a new financial year does not yet mean it’s time to panic, as this level of demand growth still sits above the average over the preceding five years. It will, however, be interesting to monitor as the year progresses,\u201d concluded Joe.\u202f <\/p>\n\n\n\n

Download<\/strong> your complimentary copy of the infographic<\/strong> to a<\/strong>bsorb <\/strong>even <\/strong>more<\/strong> <\/strong>insights <\/strong>on the legal market<\/strong>.<\/strong> <\/p>\n","protected":false},"excerpt":{"rendered":"

If the legal industry had a global stage – all eyes would be on the Australian market. Peer Monitor has developed a data-rich infographic on the four trends to watch, available here on Legal Insight.<\/p>\n","protected":false},"author":5,"featured_media":4340,"template":"","categories":[641,1317,576,1322,602,1324,605,1448,646,647,1441,625,629,634],"tags":[66,1486,343,1487,412],"resource_type":[600],"insight_job_role":[1455,604,1457,614,1363,627],"insight_practice_area":[],"class_list":["entry","author-traus","has-excerpt","post-4332","insight_resource","type-insight_resource","status-publish","has-post-thumbnail","category-benchmarking","category-business-development","category-business-management","category-innovation","category-innovation-and-technology","category-law-firm-marketing","category-leadership-career-development","category-leadership-strategy","category-legal-commentary-and-opinion","category-legal-research","category-research-and-commentary","category-research-and-know-how","category-strategy-and-business-development","category-trends-and-the-future-of-law","tag-benchmarking","tag-infographic","tag-legal-market","tag-legal-market-report","tag-peer-monitor","resource_type-infographic","insight_job_role-it-technology-manager","insight_job_role-knowledge-manager","insight_job_role-managing-partner","insight_job_role-partner","insight_job_role-principal","insight_job_role-senior-executive","hentry"],"acf":[],"yoast_head":"\nInfographic: 4 Australian Legal Market Trends to Monitor - TR - Legal Insight Australia<\/title>\n<meta name=\"description\" content=\"If the legal industry had a global stage - all eyes would be on the Australian markets success. 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