Law Firm Transactional Practices Could Decrease PPP in 2022

 There is good news in the law firm sector, at least for some litigation practices.

According to the recent Law Firm Financial Index produced by Thomson Reuters, during Q1 2022, litigation is up a bit more than 2%. That uptick has finally come to that distressed niche in legal services.

Here is a copy of that TR report.

However, according to the Index, corporate demand during that same timeframe is up only 2%. That is much slower growth than during the last 3 quarters of 2021.

Meanwhile, during the past 5 years a number of law firms had beefed up their transactional practices. The ROI on that bulking up could become increasingly disappointing. That's primarily because of 2 major factors.

One is the decline of M&A. The Index puts that at 6% for Q1 2022. The other is associate compensation which could suck out funds from PPP. During 2021, compared to 2020, overall that was up 12%. At the AmLaw 100, there was a 17% increase. There is also the 121% uptick in recruiting expenses during Q1 2022.

Obviously, there could be financial strain at some law firms. Associates should be prepared for possible layoffs, both the stealth kind and formal reductions-in-force. In addition, with PPP lower, there could be partner flight.

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com.

Comments

Post a Comment

Popular posts from this blog

Timing Is Just Right for US Government to Create The Ministry of Magic

The good versus evil meme plays out over control of the Ministry of Magic. That's the delightful plot and setting for the latest sequel in the "Fantastic Beasts" film series. This one has the subtitle "Secrets of Dumbledore." The good side is represented by Albus Dumbledore and the evil one by Gellert Grindelwald. What hangs this all together is the need to protect the mystical creature Qilin  which can see into souls and foresee the future. Meanwhile Grindelwald has conjured up a fraudulent version of the  Qilin.  Magic, of course, is the way problems are solved and opportunities are seized in the film. Those on the Dumbledore team use white magic. Those on Grindelwald's the toxic kind. But, white magic wins, thanks to the ability to get the  Qilin  to the election to select what leader is pure of heart. Along the way the displays of fanastic whatevers, including the beasts, are amazing. And, like a Shakespearean comedy, the film ends with a wedding. Al...
Read more

Law Students - Subreddit for Big Law As Ultimate Mentor

The  subreddit for Big Law  is, again, the ultimate mentor.  An introvert posed the  query  about how social he has to be to succeed as a summer. He frames the question this way: If he attends all scheduled social events and stays until 10:00 AM is that "enough?" Or, does he have to move on the party-after-the-party? And, drink a lot of alcohol?  26 detailed, thoughtful comments came in. Essentially the answer was: Enough. After all law firms are filled with nerds. The guidance was to be cordial with everyone during those events as well as back in the office. (And, yes, summer is being done RTO).  As for the party-after-the-party there are stern warnings about the inherent peril. Excess, especially of alcohol consumption, has been known to cause a career setback. One law firm ousted the summer mid-internship.  A previous discussion on the subreddit had advised summers about appropriate attire. Connect with Editor-in-Chief Jane Genova at janegenova...
Read more

The Queen's 70th - Count Us Out of the Celebration

  The Wall Street Journal, the bible of business, focuses on the revenue being generated through the anniversary of Queen Elizabeth's 70 years on the throne. Yes, the celebration will be a gala event June 2nd through the 5th. That will unfold despite how Queen Elizabeth is portrayed in the film "Spencer." Here is a trailer . The setting is the traditional-bound Christmas holiday among the royals. After 10 years the marriage has moved beyond restoration to unremitting pain for Diana and seeming frustration for Charles. Yet, the Queen is total dour and no empathy for her daughter-in-law. The focus is on preventing more bad press.  A bit of emotional warmth might have centered Diana. Instead she unravels. Her sons bear witness to that. No wonder Harry outs so much internal turmoil.  Diana is dead. The Queen is not. Sure she has her aches and pains and physical limits. But there she is. Those of us haunted by the scenes of Diana's suffering in "Spencer" wi...
Read more