The American Lawyer reports that the legal industry added nearly 5,000 jobs last month, marking the sixth straight month of job gains for the legal sector, according to recent data released by the Bureau of Labor Statistics. Though law firms have continued announcing job cuts, the latest data — which includes attorneys, paralegals, legal secretaries and others who make their living in the law — shows total U.S. legal jobs now stands at 1,117,400. While that is still well below the 1,153,700 jobs in place this time last year, the legal industry, like the wider economy, continues to recover from the loss of 64,000 jobs in April due to pandemic-related layoffs and austerity measures, the report notes.
“The steady growth was not immediately apparent several months ago, as preliminary data from August showed no growth over July. But those figures have since been adjusted upward, indicating a clear positive trend line,” notes Dan Packel of Law.com. The legal industry had 1,112,600 jobs in September and 1,110,900 jobs in August, according to numbers revised since last month. Those revised numbers show that the industry gained 1,700 jobs in September and 2,500 jobs in August (up from 1,108,400 jobs in July). “These improvements in the labor market reflect the continued resumption of economic activity that had been curtailed due to the coronavirus (COVID-19) pandemic and efforts to contain it,” notes the department of Bureau of Labor Statistics.
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The U.S. legal industry climbed to 1,142,700 jobs last month, returning to last year’s highwater mark set in October, according to recent data released by The U.S. Department of Labor’s Bureau of Labor Statistics on Law360. Professional and business services, which includes the legal sector, showed stronger gains, adding 42,000 jobs last month, in line with the average monthly gains for those services over the past 12 months, the report said.
In addition, some other recent reports indicate that the legal industry as a whole is performing well financially. One report, released in late January by Wells Fargo Private Bank’s legal specialty group, in a check-in on 2018’s year-end results found the strongest annual performance among law firms in a decade, with firms reporting average revenue growth of 5.9 percent and average net income growth of 7.6 percent.
That was consistent with another report published in December by Citi Private Bank Law Firm Group and Hildebrandt Consulting, which found that last year was the U.S. legal industry’s best for financial growth in nearly 10 years, Law360 reports. According to the report, law firm revenues during the first nine months of 2018 grew by 6.3 percent on average, due to increases in billing rates and, to a lesser degree, demand growth.
The Citi report was generally optimistic about the industry’s outlook for 2019, predicting that law firms will become more adept at using technology, project management and alternative pricing to become more efficient. It also predicted an uptick in equity partner retirements, putting the onus on firms to invest more time and energy into client transitioning.
“We are optimistic about 2019 and do not anticipate a downturn in the industry. When the inevitable downturn does occur, the biggest expense management opportunity for firms will be to study whether the composition of their leverage models makes sense from a profitability standpoint,” Brad Hildebrandt, chairman of Hildebrandt Consulting, said in a statement at the time the report was released. “That said, experience tells us that law firms are typically quick to recover from economic downturns, so long as their internal fundamentals are sound,” (as quoted in Law360).
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