Downturn in areas including litigation, property and immigration, while employment, commercial, tax, and risk & compliance thrive
A new report has revealed the practice areas most and least impacted by the coronavirus pandemic.
The Gross Legal Product (GLP) Index report published today by legal research company LexisNexis, and supported by the Bar Council, analysed and reviewed the impact of COVID-19 on the legal industry over 2020.
The report reveals that although the legal industry saw a strong rebound in the second half of 2020, the legal market is still down 4.3% year-on-year as result of the pandemic. But with legal market growth prior to 2020 at 2.7%, the report estimates full recovery is still “some way off”.
The report’s authors “considered almost 300 different datapoints to reach a representative basket of 10-20 metrics which are accurate proxies for legal services demand in 13 key areas of practice”. Each sector was then given a percentage score for recent growth or decline in demand, as well as a rating from “winners” down to “challenged”.
Litigation has been the most impacted practice area, declining by 21%. Within this, civil litigation saw the greatest decline, falling 35% over 2020, while criminal litigation proved slightly more resilient, falling by 7%. These results don’t come as a surprise given the mounting case backlog, according to the report.
Employment and family litigation dropped overall by 5% and 1%, respectively, but grew by 20% and 9% in the fourth quarter of 2020 when compared to the previous year. It is predicted that employment litigation, which showed the highest level of growth prior to the pandemic (+83%), will rebound and accelerate throughout 2021, partly due to the UK’s rising redundancy rate and cases brought before Employment Tribunals, among other factors. Family litigation, meanwhile, is said to be “the most stable area of litigation”.
Elsewhere, the report found crime, property, and immigration to have faced “critical decline” over the past year, with work in the latter practice area down 47% than in 2019. “Unfortunately, there doesn’t appear to be light at the end of the immigration tunnel, so there is a pressing need to retool staff working in this area,” the report suggested, with staff potentially redeployed in family or employment law departments.
Whilst some areas saw reduced activity, others performed particularly well and have been crowned “winners”. Risk & compliance, the most buoyant of all practice areas, grew 22% in 2020, with double digit growth in every quarter. This has been driven by “everyone and everything moving online”, and increased data privacy and cybersecurity risks, according to the report.
Commercial, too, has seen healthy growth throughout 2020, levelling out at 11%, whilst demand for advisory work grew, particularly in employment (+6%) and tax.
The report further found the anticipated boom in restructuring & insolvency hasn’t yet materialised; as of the end of 2020, demand in this practice area fell by 18%. With government support schemes staving off insolvencies, there is less work for these teams to do. Yet, the report forecast significant expansion in work ahead as government support is withdrawn.
Chris O’Connor, head of segment marketing at LexisNexis and co-author of the GLP Index report, said: “Whilst it’s been a difficult year for the industry, the GLP Index demonstrates that many practice areas have bounced back as of Q4 2020. Now is the time for law firms specialising in those areas to seize this opportunity, and plan for further growth in the coming year.”
He continued: “The report will bring concern to lawyers in property, immigration, litigation and crime. But, with visibility of this challenge, they can take the steps now to insulate their business and forge new roads to growth.”
Today’s findings are roughly in line with those of the last GLP Index report, published by LexisNexis in December 2020.