Read pretty much any report on the legal market over the past 20 years and the story is the same: Growth, growth, growth. But, a recent report by legal advisory boutique Taha & Watmough would suggest that, while that may be true at some level, the real story is a little less rosy.
Nearly all top [UK] 100 firms have seen real-terms rises in revenue and profit over the past ten years;
60% of firms have seen their revenue per lawyer fall in real terms;
60% of firms have seen profit per lawyer shrink;
More than a third of firms have seen partner profits decline.
Meaning the average equity partner at a top 100 [UK] law firm is earning less [in real terms] today than 10 years ago.
Given the rise in salaries and other costs here in Australia over that period, I wouldn’t see our numbers as being too different to those above.
So the next time you see stats telling you how well law firms are doing, remember:
“Vanity metrics are the fine China of analytics – pretty to look at, but useless at the table.”
Get in touch if you want to have a chat about how you can sustainably grow your firm
Private equity has scored a partial victory in its push to expand in the US legal market, after lobbyists softened legislation in California that threatened to disrupt liberalisation of law firm ownership rules. Attorneys in the country’s largest state will be allowed to partner on some legal work with investor-owned law firms under the terms of a law signed by Governor Gavin Newsom.
What Does This Means for the US Legal Market?
By far the largest legal market in the world, what does this development mean for the future of the US – indeed Global – legal market? While this compromise isn’t a full liberalisation of the Californian (let alone US) legal market, along with the recent liberalisation of neighbouring Arizona’s legal market, which now allows non-lawyers to own law firms under an “alternative business structure” (ABS) model, it’s certainly a crack in the door. For private equity, it’ll be a sign that resistance to change from within the profession can be negotiated down. For California’s legal establishment, it’s a signal that – finally – the status quo is no longer politically or economically inevitable. For the Global legal market, it’s further evidence, if it were needed, that despite all of the challenges that come with owning a law firm, private equity very much remains interested in this asset class.
Earlier today The 𝘈𝘶𝘴𝘵𝘳𝘢𝘭𝘪𝘢𝘯 𝘍𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘙𝘦𝘷𝘪𝘦𝘸 published the results of its Law Graduate Salary Range Survey.
Makes for an interesting read. On the one hand, nowhere near as high as overseas markets such as London, HK and the US. On the other hand, Grads on A$130K would have been unthinkable 5 – 10 years ago!
𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝗶𝘀 𝗮 𝗵𝗮𝗻𝗱𝗯𝗮𝗴 𝘄𝗼𝗿𝘁𝗵? In this case, a staggering A$15.3 million.
𝗧𝗵𝗲 𝘃𝗮𝗹𝘂𝗲 𝗼𝗳 𝘀𝘁𝗼𝗿𝘆𝘁𝗲𝗹𝗹𝗶𝗻𝗴 Unlike most handbags however, this one has a story to tell.
It was the very first Birkin bag.
Designed by Hermès executive Jean-Louis Dumas in 1984, following a chance encounter on a flight with actress and singer Jane Birkin (hence the name), the bag was used daily by Birkin for nearly a decade before she donated it to an Aids Charity auction.
What the sale of this bag evidences though is how value extends beyond material worth. Value is not the $$$ signs you seen on the price-tag; it’s about the stories we tell, the history we preserve, and the emotional connections we forge.
The sale of this bag is a powerful reminder to professionals that authenticity and narrative can elevate your service offering from ordinary to iconic.
It is your powerful – and likely only – differentiator. It is what clients are willing to pay for.
As we navigate 2025, Australian midsize law firms find themselves at a pivotal crossroads—balancing client expectations, talent retention and the promise (and pitfalls) of technology. The recently released 2025 Australian Midsize Law Firm Priorities Report by Actionstep offers a deep dive into what’s shaping the future for these firms.
Here’s s summary of what you need to know from the Report—and how your firm can stay ahead.
🎯 Client Satisfaction: The Cornerstone of Growth
It’s clear—client satisfaction is king. 71% of midsize firms rank it as their top priority for protecting and growing revenue. But it’s not just about delivering legal outcomes; it’s about building trust-based relationships, offering personalised service and consistently exceeding expectations.
Interestingly, firms are focusing more on deepening relationships with existing clients rather than chasing new business. In fact, 37% see expanding existing client accounts as their primary growth strategy for 2025.
✅ Takeaway: If your firm isn’t investing in client experience, you’re leaving growth on the table.
👥 Talent Retention: Your Secret Weapon
While technology grabs headlines, midsize firms know that people drive performance.
59% of firms highlight attracting and retaining talent as a top strategic priority.
Engaging work, leadership and firm culture outrank pay as key reasons employees stay.
However, when employees consider leaving, pay and remuneration become the decisive factor. This signals a clear message: while meaningful work keeps people engaged, competitive compensation keeps them committed.
✅ Takeaway: Create a workplace where talent thrives—offer challenging work, clear career paths and ensure your pay structures remain competitive.
💻 Technology & Automation: The Untapped Advantage
Despite recognising efficiency challenges, midsize firms remain cautious adopters of automation and AI:
Only 38% are actively using automation tools.
Just 5% have reached AI maturity.
Cybersecurity concerns and data privacy remain top barriers.
There’s also a noticeable gap in digital client experience. While firms excel in personalised, human-centric service, only 41% feel confident in their digital touchpoints like client portals and automated communications.
✅ Takeaway: Embrace technology—not to replace people, but to empower them. Automation can reduce workloads, freeing your team to focus on high-value client interactions.
🔐 Cybersecurity: More Than Just IT’s Problem
With client trust on the line, cybersecurity is non-negotiable. Yet, the biggest risk isn’t technology—it’s human error. Over 63% of firms cite staff behaviour (think password sharing, weak authentication practices) as their top vulnerability.
✅ Takeaway: Build a security-first culture. Regular training, robust protocols, and smart tools like multi-factor authentication are essential to protect both your firm and your clients.
🏆 5 Strategies for Midsize Law Firm Success in 2025
Acknowledge Tech Scepticism: Start small, demonstrate wins, and build confidence in automation.
Prioritise Efficiency: Use automation to tackle time constraints and free up your team for strategic work.
Enhance the Client Experience: Leverage digital tools to complement your personal service.
Strengthen Cybersecurity: Focus on both technology and employee awareness.
Put People First: Foster engaging work environments and ensure competitive compensation.
Final Thoughts
2025 presents both challenges and opportunities for Australia’s midsize law firms. Those that blend human expertise with smart technology, prioritise client relationships, and invest in their people will be best positioned to thrive in an increasingly competitive market.
The latest Law Society (England and Wales) Financial Benchmarking Survey has sparked significant discussion on social media today. The findings highlight some critical financial challenges for mid-sized law firms, particularly in terms of profitability, chargeable hours and cash flow management.
📊 Top 3 Key Findings:
1️⃣ Fee Earners’ Costs vs. Fees Charged
The median hourly cost of a fee earner (based on 1,100 chargeable hours) was £123.40, while the median hourly fees per fee earner stood at £133.01.
🔴 93% of fees earned are being used to cover costs, leaving minimal margin for profitability.
2️⃣ Shortfall in Chargeable Hours
The average recorded chargeable hours per fee earner increased slightly to 773 hours (up from 765 in 2023).
⚠️ However, this is still well below the 1,100-hour target—a shortfall of over 300 hours per year per lawyer.
3️⃣ Increase in Lock-Up Days
Year-end lock-up days (including work in progress and debtors) rose from 143 to 146 days.
This trend indicates longer cash flow cycles, which can put pressure on a firm’s financial stability.
🚨 What Should Law Firms Do?
These figures underscore the urgent need for better financial planning, sustainable profitability strategies, and operational efficiency. Some key focus areas include:
✔️ Improving revenue streams—exploring retainer-based models for better income predictability. ✔️ Enhancing productivity—have a robust and actionable business development plan for all lawyers! ✔️ Optimise cash flow—reduce lock-up days by streamlining billing and collections processes.
📢 Looking to bridge the 300+ hour gap per lawyer? Or interested in strategies for growing a profitable legal practice sustainably? Let’s talk! Get in touch today.
A recent report, “Strategic Sector Insights for the Legal Profession 2025: Mid-Sized Firms”, published by The Law Society and MHA, reveals a striking trend:
👉 More than 50% of mid-sized law firms report that their lawyers bill less than 25 hours per week on average. 👉 Less than 3% of lawyers at these firms bill anywhere close to the full 40-hour workweek.
While it’s unrealistic to expect lawyers to bill every hour they work, these numbers highlight why alternative pricing models are a key priority for firm leaders in 2025.
⚖️ What does the future of legal pricing look like? If you’re exploring value-based pricing, subscription models, or hybrid fee structures, let’s talk!
📩 DM me to discuss innovative pricing strategies for law firms.
Earlier today, the Thomson Reuters Institute published its Midyear Update on the Australian Legal Market, providing valuable half-year insights into industry trends in the Australian legal market.
There’s a lot to unpack in the Report, and I highly recommend you download it. That said, here are my top takeaways:
✅ What’s Happening with Non-Equity Partners? Is there an underlying story in the Non-Equity Partner segment? The data suggests there might be more to explore.
✅ Equity Partners Carrying the Load? If legal market demand and worked rates are up in 2024, yet the average billable hours per lawyer are down, it raises a big question—are Equity Partners absorbing the extra workload? If so, why?
✅ Billable Hours Decline With 12 months in a year, many law firms have lawyers billing less than 1,500 hours annually. What does this mean for profitability and productivity?
If you’re looking to refine your pricing strategy or need guidance on law firm profitability, feel free to get in touch. In the meantime, download the two-page update and see the data for yourself!
A recent article by BTI Consulting’s The Mad Clientist (‘Did Clients Just Go Sour on Rankings and Directories?’ published on 12 February 2025) states that:
Thought leadership now outweighs rankings – especially when forming new relationships.
While we talk often about “thought leadership” in professional services, I’m not entirely sure we understand the mechanics and actualities of what constitutes “thought leadership”.
For a start, if you say you’re a “thought leader” chances are you’re not – as only others can pin that tag on you!
So, I thought I would do quick run through what thought leadership means to me, as well as some ways you might be able to demonstrate your knowledge in such a way as others start to consider you a thought leader!
What is ‘Thought Leadership’?
Thought leadership is the art of positioning yourself, or your firm, as a leading authority in a particular area – industry or field – by sharing (typically for free) valuable insights, expertise, and innovative ideas.
Thought leaders influence their audience through content such as articles, blogs, speeches, books, research and social media engagement.
Key Aspects of Thought Leadership
Expertise & authority: Thought leaders have extensive knowledge in their field and are trusted sources of information.
Innovative thinking: Thought leaders challenge conventional wisdom and introduce new perspectives or solutions.
Content creation: Though leaders share insights through blogs, articles, whitepapers, podcasts, videos, or public speaking.
Engagement & influence: Thought leaders actively participate in discussions, mentor others and drive industry trends.
Authenticity & credibility: Genuine thought leaders prioritise value over self-promotion, building trust through consistency.
How can I display thought leadership?
Many professional firms limit their content strategy to publishing articles on their firm website and stopping there. While this is a good starting point, it doesn’t fully leverage the power of content marketing to attract, engage, and convert potential clients.
To expand your reach and establish your authority as a thought leader, consider adopting the following to your content marketing strategy:
Blog posts: Either via your own blog page or your firm’s (or even both), regularly provide in-depth insights, case studies, and industry updates. From time-to-time offer to guest post on other people’s blogs as well.
Newspaper comments and articles: Write a regular column in a reputable newspaper on your area of expertise. You can also become a source of commentary – newspapers are always seeking commentary from industry leaders.
Whitepapers & eBooks: Offer comprehensive research findings, legal guides, and thought leadership content. Look to position both yourself and/or your firm as the trusted authority in that area/field.
Videos: Create a YouTube or TikTok account and make videos that help explain intricate and complicated topics in a dynamic, accessible and easy to consume way.
Webinars & Live Streams: Host real-time discussions, Q&A sessions, and educational webinars – either on your website or via other platforms such as LinkedIn.
Podcasts: Either host your own podcast or provide expert insights on podcasts hosted by others.
Social Media posts: Engage in relevant discussions on platforms like LinkedIn, Instagram, Facebook and X.
Email Newsletters: Share valuable insights, firm updates, and case studies directly with subscribers via email providers such as MailChimp.
Bringing it all together
Thought leaders are recognised by others for their deep knowledge of a subject matter and so have the ability to shape conversations, influence decisions, and inspire others. These are all attributes that will help expand your audience reach and establish credibility in your area – leading to a higher number of requests for assistance and a bigger book of business!
Feel free to get in touch if you need help with your thought leadership strategy.
It’s interesting to note that nearly 70% of respondents expect their Associate Attorneys to bill over 1700 hours a year, with almost 10% expecting over 1900 billable hours per year.
That’s a lot of billable hours! And if we consider the ‘10-20-30-40 Leverage Rule‘, then the implication is very bleak for junior lawyers!
And as I say to those entering the legal profession who need some understanding of how many hours they need to work to meet their billable hour target, take a look at Yale Law School’s ‘The Truth About The Billable Hour‘.
While I am all for the profit motive, I maintain that if owners and managers of law firms want to understand why they have a high attrition / burnout rate in their teams, take a close look at what expecting someone to bill 1700 hours a year is actually doing to them!
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