Legal market shows signs of growth despite pandemic

A LexisNexis report has revealed the areas of law most and least hit by the COVID-19 pandemic.

The legal publishing giant’s first Gross Legal Product (GLP) index report, released this week, tracks various representative metrics to measure the impact on different areas of the legal market and predict the long-term impact.

According to the index report, the legal market contracted 2.5% in the first quarter of 2020―but this shrinkage was not universal. The GLP showed that some practice areas are growing, for example, employment law is faring well as companies work to understand the short and medium-term legal consequences of furloughing 7.5 million employees.

The GLP indicated that commercial, tax and employment law will continue its recent strong growth or the crisis will give practitioners in these areas an opportunity to rebound in financial services, restructuring and insolvency. It found an 8% growth in commercial law in the past three months, and predicted that demand for in-house legal work would continue to grow, particularly for corporate lawyers.

And while the larger firms will weather the storm, the report indicated that it will be the smaller firms of corporate lawyers who do best, emerging stronger and larger as they are less exposed to the contracting parts of the market.

On the negative side, the GLP revealed the extent of the lockdown’s devastating impact on certain practice areas, notably the residential market. Residential sales are down 70%, while a distressed commercial real estate sector has seen property legal activity drop by 25%. Immigration has been equally affected.  Originally fast growing as businesses and individuals grappled with the complexities of Brexit, it has suffered from the suspension of global travel.

Chris O’Connor, LexisNexis head of segment marketing and author of the report, said: ‘The report has brought clarity and data to a very complex time in the legal industry. 

‘These are tough times for the legal market. I hope that this report helps legal practitioners to make the very difficult decisions that lie ahead.’

For comparison, the Gross Domestic Product (GDP) fell 20.4% in April, according to Office of National Statistics figures.

The GLP report can be accessed at bit.ly/ 2CgfE7r.