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The legal sector’s recovery continues as lockdown eases

11th June 2021 Print

The pandemic has forever changed the way the world works and does business, including in the legal industry. During and after the height of Covid-19, the legal industry (like many others) has had to adapt and redefine the way it works in order to survive. For many, the impact of the pandemic has been widely and deeply felt. For instance, many legal firms made sweeping employee cuts as they were forced to restrict in-office working and travel, and cut costs. As of September 2020, more than 110 jobs at Irwin Michell were at risk for redundancies. Job losses were not the only change either. From declining demands to a widening digital divide, the legal sector has faced some unique pandemic challenges. Now, as workplaces prepare for a safe return, all eyes are on how the legal industry will handle its new challenges. 

One in Five Law Firms Saw A Decline In Demand For Legal Services  

In recent research by Clio, a cloud-based management software company, the number of legal matters being opened each week declined by 40 percent in 2020. The main cause of that slowdown was the choice of consumers to delay their legal issues until the pandemic had passed. Whether it was due to monetary issues or the misconception that the legal sector (like many other industries) had halted operations, consumers said they had put off getting legal advice. 

In response, legal firms have had to rethink their marketing strategies to gain attention online. An increasing number of law firms now use an SEO guide for best search engine optimisation habits to improve their firm’s rankings. A good example of this is getting the firm to local listings on search engines (also known as the three-pack). With the internet being the most popular way to find lawyers, the pandemic has just hastened the need for legal firms to invest more in their digital presence. 

Revenue Income Fared Well Despite The Slowdown 

Despite the legal sector experiencing significant upheaval during the pandemic, the UK legal industry has fared comparatively well in terms of revenue decline. According to the Office for National Statistics (ONS), revenue in the legal sector declined by 4.7 percent. Estimates for the economy put the national economic decline at 20 percent - relatively higher than the legal industry. Considering that leading law firms like Norton Rose Fullbright predicted declines of up to 20 percent for the year, the relatively small decline has been a welcome development.  

The Digital Divide In Legal Services Is Stark Post-Pandemic 

The pandemic redesigned the working landscape for many industries, including the legal industry. With orders to stay at home, work from home arrangements became a necessity for legal firms, and those firms that were not yet technologically reliant were forced to adapt very quickly. Now, many firms are relying on video conferencing technology, cloud computing systems, and virtual arbitrations to continue working. 

Going forward, legal firms will face meticulous judgement on their behaviour during and after the pandemic. According to Kerry Jack of Black Letter Communications, clear communication and deviation to a personal touch will give legal firms the edge going forward. At a time when compassion, empathy and a personal touch are needed by customers, legal firms have been expected to provide relevant advice on the legal impact of the pandemic and various issues like the much talked about self-employed sector. The pressure for the legal industry to become more customer-centric is expected to intensify. 

While this period immediately after lockdown may seem optimistic for the industry, it may be masking longer-term issues down the road. Some parts of the industry like insolvency, restructuring and employment law are expected to be very busy in the coming months as the economy deals with the other casualties of the pandemic. However, like many other industries, the recovery period will be one that will demand great agility. 

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