No American industry has escaped the effects of the global coronavirus pandemic. Many have been shaken to the core, and the legal profession is among them. COVID-19 has brought disruption and uncertainty, but there are signs of hope and foundations of optimism to build a positive outlook upon.
At Korous Recruiting, we have been watching the trends and — despite the initial fears and dread— we have been happy to see that things have been picking up and are continuing to move towards a positive trend. In fact, we have seen an upward trend in hiring that began in the second half of the third quarter. There is a sizeable backlog of positions to fill and backfill, and this has certainly created demand and therefore a competitive job market as firms work to retain top talent and competing firms work hard to attract them away.
This is quite the contrast from the initial bleak outlook we all had when the pandemic hit. Hiring plummeted, especially on the associate side. Law school graduates entered a state of limbo as hiring was paused and uncertainty about their immediate future grew. Many were anxious and fearful of how law firms might react, but what we witnessed was a refreshing departure from the way law firms reacted in the 2008 economic crisis where massive layoffs took place. Instead, many firms preemptively cut salaries to stem the tide.
So, besides the lessons learned from the last economic crisis, what lead to this change in response? Given that those worst-case scenarios, simply didn’t come. According to a 2021 Citi Private Bank/Hildebrandt Consulting client advisory report, which surveyed mostly larger law firms (Am Law 1-50) with U.S. headquarters by Citi Private Bank and conversations with law firm leaders, it is because of the strong start it had in the first quarter, and then, after the World Health Organization declared the novel coronavirus a global pandemic in mid-March, the industry’s ability to rapidly morph into a remote business model, shifting strategies as deftly as a prosecutor that’s just uncovered new evidence.
The advisory reported that, between January through September 2020, average law firm revenue grew 5% over the same period in 2019 — even during a surging global pandemic. Also, total legal industry expenses were down 2.1%, the advisory reported, driven in large part by a decrease in operating expenses as firms pivoted to a virtual business model. Award junkets to the Bahamas and other perks were canceled, travel was cut drastically (if not completely), and major capital expenditures were back-burnered across the landscape.
Citi and Hildebrand found that an agile adaptation of a remote working environment by firms around the world and the vigorous performance of some practices like bankruptcy, litigation, finance, and capital markets, were key drivers. There was also renewed hope for M&A as the practice picked back up in the third quarter of the year. Entering 2021 armed with lessons learned this year sets the table for a more efficient and economical landscape, the report forecast.
We know many of you were worried year-end bonuses would not come in 2020, but we have seen many big firms pay associate bonuses in the last few weeks. We have been pleased to see that some of the bigger firms have been paying market bonuses and some even paying special COVID-19 bonuses —some quite substantial — which has put a lot of anxiety to rest.
At Korous Recruiting we are optimistic about the future and we expect a strong year in hiring in 2021. We would love to be a resource for you and connect to see how we can assist you. We encourage you to read our testimonials to learn about what sets us apart.
A few words from the Founder –
“What I do is more than a job for me, I see it as a form of service and that’s very important to me. In my work, I strive to make matches that align well with my candidates’ current and future aspirations. I truly enjoy building these relationships and establishing a reputation that expresses my genuine care as well as my expertise in the market.”
-Parisa Korous, Founder
Wishing you all a prosperous year ahead.