Most know that the recovery following the 2007 Crash had been weak. Litigation practices never bounced back. Eventually the pace of growth in transactional also slowed down.
But, as David Lat observes in Abovethelaw, clouds seem to be gathering over even all that.
Lat bases his assessment on Am Law's 100 ranking report. The telling number in it is the Average Revenue Per Lawyer. That increased 1.5% versus 2.6% last year. In itself that is a red flag.
Another scary sign is the growing stratification among firms, that is the distance between winners and losers in financial performance. Among the winners are Kirkland & Ellis and K&L. Meanwhile the number of losers increases.
The bottom line on this is: The legal sector could be heading into a downturn. Of course, that means partners, associates and staff should be bracing for layoffs.
Those anticipating being terminated should start looking for another job before that happens. Not having a job makes it harder to get a job. Moreover, post a reduction-in-force the unemployed are competing for work with their former colleagues. The market becomes even more glutted than before.
If the demand for legal talent shrinks significantly, then lawyers have to consider a career change. That's just the way it is.
During the Crash of 2007, several displaced lawyers initially resisted looking beyond the legal sector to earn a living. They contacted me for help with their job-search materials for legal jobs. Eventually they got it that their legal career paths had ended. Meanwhile, though, they lost two to three years of their working lives.
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