Concerns About Economic Slowdown and How Law Firms Might Be Impacted
Economists believe that there could be a slowdown on the horizon — though few expect the economy to sink into a depression akin to the 2008 crash (which completely shook the ground beneath the feet of the Biglaw industry), there are many who expect that the US economy will dip and enter into a recession sometime in 2020. This has many legal industry experts — and naturally, prospective attorney candidates — concerned about how the slowdown will impact hiring going forward.
It’s important to consider that the legal industry is growing significantly on an annual basis in the United States, and that effect is even more strongly felt in California, whose economy is somewhat more resilient and more vibrant than the rest of the country, thanks to the continued prominence of the tech and entertainment industries. Experts estimate that law firms will grow their business by roughly seven percent over the next year, despite concerns about an overall economic slowdown on the horizon.
Concerned about the economic slowdown and interested in understanding your value on the legal job market? We encourage you to contact the team here at Garb Jaffe & Associates to learn more about what opportunities are available for a candidate with your unique skillset and background.
But let’s take a step back and consider how the impending slowdown might impact hiring in the legal industry, even if there may be a slight “delay” before the effects of the slowdown are truly felt.
Firms are smarter than ever with respect to cutting down staff in anticipation of major economic events. In the wake of the 2008 crash, firms no longer want to deal with the catastrophic structural consequences of cutting hundreds of staff at once, and instead are willing to experiment with anticipatory cuts. This gives existing employees a chance to assess the “atmosphere” and determine whether their position is safe, or whether a different employer may offer them more stability and better growth opportunities.
Focus on Performance
Generally speaking, when firm revenues are threatened, performance-related evaluations become more important. With a slowdown on the horizon, firms will likely cinch their waist using a performance-based belt. Expect firms to respond more seriously to attorneys who fail to meet their quotas, or who otherwise underperform their peers.
Effect on Both Litigation and Transactional Practices
Both litigation and transactional practices are expected to be impacted by the upcoming economic slowdown. When a recession hits, litigation tends to be more careful, and companies are much less apt to pursue active (as opposed to reactive) litigation against their competitors. This could reduce the workload significantly for attorneys working in certain practice areas, such as IP litigation. Certain transactional practices may also be affected, such as those involving private equity.
Some Practices Expected to Thrive
Slowdowns always lead to opportunities in some sectors, however, and in the legal industry, those opportunities are likely to be found in corporate restructuring, debt refinancing, and other practices involving distressed entities. If you have experience working with distressed entities, then it may be worth exploring further specialization therein — or at the very least, taking on more projects relating to distressed entities so that you are better prepared to take advantage of new opportunities over the next few years.
Contact Garb Jaffe & Associates for Recruitment Help
Here at Garb Jaffe & Associates, our team of Los Angeles legal recruiters have spent several decades working with a range of California attorney candidates — from midlevel associates looking for a new opportunity to realign their career trajectory, to partners interested in establishing themselves at a firm with a more cohesive organizational culture. We understand the varied experiences of attorneys throughout the industry, and the need to provide truly tailored recruitment assistance. Simply connecting an attorney candidate to a “good” position is not enough — we believe that it’s important to find the best possible fit under the circumstances, as this is much more beneficial for both the employer and the candidate in the long-term.
We work with clients at every stage of the hiring process, from conducting an initial analysis of their competitiveness on the market, to identifying potential landing spots in prominent organizations throughout the state of California, to helping them spruce up their applications and prepare for interviews. This comprehensive service is foundational to what we do here at Garb Jaffe — our candidates compete from a position of strength, giving them the ability to market themselves on their own terms.
Ready to speak with one of our legal recruiters? Contact us today to learn more.