Recovery, Remote-Working, & Succession Planning
The legal sector continues to recover from the initial shock of the Covid pandemic. Legal sector jobs have grown every month since April 2020 (with the exception of December), averaging new 3,750 jobs per month (Legal Jobs Multiply Following Historic Month in Deal Making, Dan Roe, 3/5/21, American Lawyer). However, overall legal sector job numbers are still below February 2020’s peak (Legal Jobs).
Relatedly, lateral attorney hiring is nearing pre-pandemic levels for the first two months of 2021. Nationally, there were 1,495 lateral hires in Jan./Feb. (vs. 1,672 in Jan./Feb. 2020) (Webinar: State of the Legal Industry Report 2020, 3/4/21, Leopard Solutions). At the beginning of this month, there were approx. 6,300 open positions at law firm nationally, up from approx. 3000 in June (Legal Industry Report).
Remote-working:
Charlotte, Durham, and Raleigh ranked in the top 10 out of 100 cities for remote working in an analysis by SmartAsset (Charlotte, Two Other North Carolina Cities Rank as Top Spots to Work from Home in 2021, Jenna Martin, 1/22/21, Charlotte Business Journal). Criteria include ability to work from home, % of residences with 2+ bedrooms, and housing costs as a % of earnings, among others. SmartAsset found that remote working increased prior to the pandemic (2015-2019) in all three cities, with Raleigh and Charlotte registering remote working by 10.5% and 10% of their respective workforces in 2019.
Looking toward the future, SmartAsset found that 30-32% of the workforce in each of these cities could work remotely, which puts N.C. firms in a particularly good spot to both accommodate attorney & staff preferences and save on real estate costs (Law Firm Staffers Don’t Want to Return. Should They Get the Choice?, Dan Packel, 3/5/21, American Lawyer) (60% to 80% of law firm professional staff surveyed would be happy to continue working remotely) (Am Law 100 firms that recently negotiated 130,000 square foot spaces are now looking at spaces that measure 90,000 or even 55,000 square feet); U.S. Law Firm Real Estate Trends: Their Recent Evolution and What to Expect Post-COVID-19, Bethany Schneider, 2/21 Newmark (In a sample of gateway markets, total gross leasing activity by law firms declined 41% between 2019 and 2020).
Harvard Law Professor Scott Westfahl, Director of the Law School’s Executive Education Program, predicts that firms that take a hardline on reporting to the office every day will lose in the talent market (With ‘No Playbook’, BigLaw Leaders Must Lead Differently Post-Covid, Dylan Jackson, 3/16/21). Anecdotally, we have seen evidence of this even pre-pandemic, with lateral candidates preferring practices with reduced “face-time” requirements.
Succession Planning:
We’ve been contacted about several “succession” searches in recent months. Succession planning of outside counsel has been on the minds of some in-house counsel for years. (Not Having a Law Firm Succession Plan is More Dangerous Than Ever, Zack Needles, 2/21/21, Law.com Trendspotter) (referencing a 2018 interview of Chief Legal Counsel Timothy Phillips: “If the [outside lawyer] I typically call is in the sunsetting of a career and I don’t see a promising next-generation lawyer there…I will move to another shop.”). However, even clients who never before questioned succession planning may begin to probe as part of corporate diversity, equity, & inclusion efforts (Corporate Clients are Paying Attention to Succession Planning, Christine Simmons, 2/4/21, Law.com). For example, Coca-Cola is mandating in its new diversity guidelines that outside counsel identify at least 2 diverse candidates for succeeding the current relationship partner (Corporate Clients).
