By DebbieH 21 Oct 2019 7 min read

Employment in the legal industry

The legal industry is ever changing, resulting in the creation of new roles, the adoption of different practices and new niches, particularly regarding technology and online crime.

This article looks at how the sector has changed in recent years and how it could evolve further. It will also look at recent figures regarding finances and employment within the UK legal sector. As law firms become more digitised and a number of qualified solicitors turn to freelancing, we could see some significant changes in 2020.


Employment statistics relating to the UK legal industry

The Annual Statistics Report based on figures from last year shows the following:

There were 143,167 solicitors with practising certificates (PCs) in the United Kingdom and a further 188,868 individuals on the Roll of solicitors. The amount of solicitors with practising certificates increased by 2.5% from the previous year.

There were also 2,000 more women holding a practicing certificate than men, this followed 2017 which saw the amount of female PC holders surpass 50% for the first time.

Individuals from Black, Asian and minority ethnic groups rose to 16.9%.

PC holders working both in-house and at private practices also displayed an increase from July 2017 – July 2018. 22.4% of holders were In-house solicitors, while the number of holders working in private practice rose to 93,825.

The number of limited companies amongst the 9,452 private practice firms listed in the UK also grew in this time. Partnerships, including sole practices accounted for 60% of private firms in 2012 but this figure has now dropped to 40%.

There are around 12,000 law firms registered in the UK with fewer and fewer firms following the traditional partnership model; there are also 1,300 firms operating under the Alternative Business Structures model in England and Wales.


Financial statistics relating to the UK legal industry

The following figures are taken from the “UK Legal Services Market Trends Report 2019” published by Business Wire.

In 2018, the UK legal services market was valued at £35.1bn, a 6.3% increase from the previous year. Making adjustments for inflation, the figure shows a rise of 3.7%.

Revenue growth for the top 100 law firms in the UK is higher than the overall legal market due to factors such as; higher sales due to business acquisitions made by the top 100, a large number of corporate contracts and significant overseas revenue.

Business and commercial affairs represents 47% of the total market revenue in the UK, with most of the high-value contracts going to larger firms. Personal injury/accident/medical negligence work accounts for 11% of this market revenue despite a drop in the number of claims being placed.

Business Wire’s revenue growth forecast for the UK legal services market in 2019 is 5.4%, based on current pricing, with year-on-year growth of between 5%-6% expected from 2019 to 2022.


Graduate jobs in the legal sector

The legal sector is amongst the most competitive industries in the UK in terms of gaining employment – it is especially competitive for graduates, with a reported ratio of 28:1 for law graduates to legal sector job vacancies.

In 2017, it was reported that there were over 28 graduates to each legal vacancy and this figure is thought to be little changed in 2019. Due to this shortage of opportunities for graduates there is a greater demand for new roles and alternative career paths within the legal sector which could be rectified by the introduction of more digital services.


Industry Changes

Over the next 12 to 18 months, Business Wire expect price transparency to increase due to regulations which require legal service providers to disclose prices on their website.

Consumers will also find it easier to procure legal services online due to changes imposed by the Ministry of Justice. As a result, this is expected to reduce the amount of people seeking legal advice in person, instead opting to use digital resources.

The small claims limit will also be lifted in April 2020 which could also see an increase in consumers attempting ‘DIY law’.

An increase in freelance solicitors and qualified solicitors working for unregulated practices will also increase the amount of options available to consumers. This could also result in lower fees as freelance solicitors in particular may benefit from reduced overheads. However, there is a concern that a lack of regulation could lead to lower professional standards.

It is also expected that the amount of law firms looking for a public listing will increase, based on the success of those currently listed.

The number of firms which are evolving into professional service companies, as opposed to legal service providers is also forecast to rise. This is already common for firms listed on the stock market, while personal injury companies offer additional services such as; insurance, accident management and medical legal advice. A number of smaller law firms have also merged with other companies such as accountants and estate agencies.


Future challenges within the industry

In 2018 there was a 29% increase in the number of lawyers choosing to work flexible working hours, sometimes known as platform lawyers. There are now over 1,000 lawyers in the UK working remotely or for platform firms. This lowers overheads, resulting in lawyers keeping a greater percentage of their fees and in some cases, allowing them to manage other business interests in their spare time. More and more qualified professionals could seek these career path, particularly those who feel underpaid which could have a significant impact on law firms over the coming years.

Fewer senior solicitors are also willing to enter partnerships at traditional law firms, as a greater number of large companies choose to employ in-house lawyers. This reduces the amount of experienced lawyers working for partnerships, with the top-performers often being poached by larger organisations.

Uncertainty surrounding Brexit could also impact the UK legal sector which must rely on the success of other industries and the wider economy.

Legal service providers are undergoing significant changes and an unclear economic climate makes it difficult to make accurate predictions in terms of the future of employment in the legal industry.