More bad news on law firm financial performance

November 16th, 2012 by Altman Weil

“The drumbeat of bad financial news continued for the legal industry Thursday, as yet another survey of large law firms showed demand for their services essentially flat through the first three-quarters of the year and revenue growth for 2012 likely to fall short of last year’s single-digit gains.

The Wells Fargo Private Bank Legal Specialty Group survey found that, on average, the 115 participating firms—a group that included 60 Am Law 100 firms, 40 Am Law Second Hundred firms, and 15 boutique firms—took in 3 percent more revenue during the first three quarters of the year than they did during the same nine-month period last year. Profits, meanwhile, were up just 1.5 percent. “

The survey found billable hours down slightly for equity and non-equity partners and associates, realization rates down, and expenses up compared to the same period last year. 

What are law firms to do?  The article concludes:

“One way firms may be coping with the perfect storm of slackening demand, increased expenses, and falling realization rates is by raising their fees: Billing rates were up 3.4 percent through the first nine months of the year, and two-thirds of the firms surveyed said they plan to raise billing rates between 3 and 4 percent overall next year.”

Read it at The AmLaw Daily

This entry was posted on Friday, November 16th, 2012 at 1:52 pm and is filed under Law firm management, Law firm finance, Trends. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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