Colum Smith is a legal entrepreneur, high-profile litigator and Chief Vision Officer at Taylor Rose MW, which has just been short-listed as Legal Firm Of The Year. He gives his view on the labour shortages facing the profession.
Speak to anyone in the industry right now and one word comes up over and over again: recruitment.
Finding staff and then retaining them is a huge challenge. I would put it right at the very top of the challenges facing most leading law firms.
The signs were there long ago that this was going to become a massive issue for our sector. In 2019 the number of companies hiring people set new records, with recruitment rates rising 20 per cent on the level seen in 2018.
Then Covid-19 arrived and, understandably, the pandemic saw many companies freeze recruitment. Now, with the economy fully reopened, many businesses are struggling to find the talent they need to expand.
One of the biggest reasons for this is that the priorities of employees today are worlds apart from what they were in 2019. Post Covid, many staff are demanding work from home as standard, while many more are insisting on vaccine mandates and specific definitions of flexible working, all of which increase the workload for those tasked with recruitment.
Due to soaring labour demand, the market is also incredibly competitive. Getting extra solicitors through the door can help companies unlock large swathes of new business, so paying a recruiter to find the talent isn’t a cost, it’s an investment.
Those being headhunted have totally different demands and needs now, too. When I started working in the legal sector the expectations of entrants joining the profession were often linked to a firm’s corporate image. The high-rise city-centre office, workplace perks and generous expenses tab were all part of the attraction.
None of that matters now.
Lockdowns created a more flexible environment with working from home structures, and it has allowed employees to mould their working life around personal and family needs.
After experiencing a more balanced lifestyle, many lawyers are no longer prepared to return to the stressful and sometimes toxic 24/7 office life. Law firms need to recognise that and be more flexible themselves otherwise they simply won’t find the talent they need.
Law firms need to think more widely, too, as they structure their business models. Here at Taylor Rose we have noticed more and more solicitors are interested in working under consultancy agreements.
We have responded by pivoting to expand our own consulting wing. As a result, yearly consulting revenues within Taylor Rose MW have more than quadrupled.
Since our business pivoted to add a legal consulting offering, we now have more than 350 consultants working for Taylor Rose MW, and our current growth rate is between 15-20% per month. Consultancy has become an attractive and viable alternative way of working for experienced lawyers, which offers increased earnings and a better work/life balance.
Consultants also enjoy marketing support, a recognised brand, sophisticated IT support and systems, professional indemnity insurance and SRA supervision, as well as the lower operating costs of home working.
Technology opportunities – and threats
Hybrid work arrangements aren’t entirely new for law firms but the scale of remote work post-pandemic will test their previous protocols. Law firms and their consultants must have a blueprint for developing and maintaining a culture which breeds success.
Technology overhead spending is likely to increase and the need for a flexible budget in updating equipment and training staff is going to be critical.
The signs are there that law firms are becoming more receptive to spending in this area. According to a Thomson Reuters Peer Monitor Index report released in February, law firms’ tech expenses increased 5.8% in the fourth quarter of 2021.
This tech enthusiasm not only included spending more, but also being more willing to automate inefficient manual processes and drive tech adoption. This is vital.
Law firms also need to be mindful that hybrid and consultancy models of working throw up security issues.
Without direct physical access to IT, a secretary or paralegal, lawyers and staff may take software troubleshooting into their own inexperienced hands. That introduces risk.
Bad habits that some lawyers and staff formed while working remotely may also have followed them back into the office and created data governance headaches in a hybrid workflow.
As is the case in any challenging moment there will be difficulties as firms navigate this labour shortage. But there will be opportunities too both for employees and employers.
As we saw during Covid, those willing to adapt and pivot the quickest will greatly boost their chances of success.
- Connect with Colum Smith via LinkedIn