Lawyers took drastic measures to keep profit up during the recent recession, including cutting staff, reducing overhead, using contract lawyers and even outsourcing work.
But, it appears to have paid off.
Gross revenue in most firms grew last year, according to the Altman Weil’s annual Law Firms in Transition survey.
Josh McDowell, a senior partner with McDowell, Laybourne & Rodemer in Colorado Springs says business is better these days.
McDowell, Laybourne & Rodemer specializes in criminal defense, DUI and personal injury law.
The firm saw the biggest drop in its criminal defense business, he said. He blamed the large retainer needed for criminal defense and DUI defense cases as the reason behind the drop.
To keep the company profitable, the firm simply increased their advertising and marketing efforts, and expanded its personal injury/malpractice division.
“We didn’t cut costs, we spent more to grow the business during the recession,” said McDowell. ‘That’s probably been something that’s been key to our success and growth. Instead of cutting back, we’ve expanded advertising routes and methods.”
Greg Critchfield, CEO of Bachus & Shanker, LLC, personal injury attorneys with offices in Denver , Fort Collins and Colorado Springs , saw an indirect effect of the economy in the jury, stating that the economy has a unique effect on the jurors.
Overall, the economic effects didn’t hit the contingency-based firm hard, and it has done well in the post-recession economy.
“We did look at our finances a bit more closely and tried to tighten up our annual budget,” said Critchfield. “In general, we tried to conduct business in a fiscally (friendly) way.”
Neither of the firms raised rates during the recession.
Law firms aren’t alone — law schools also bore some of the effects of a dismal economy. But in Colorado, enrollment statistics defied the national average. The University of Colorado Law School in Boulder saw a record-number of applicants this year, 3,160, up 12.7 percent over the previous year. Nationally, law schools saw an average 11.5 percent drop in applicants.
“We’re still one of the most affordable law schools,” Jill McGranahan, director of communications and public relations at University of Colorado Law School. About 180 students will be selected from the field of applicants to start law school in the fall.
With many students graduating this month, competition to land a job will be tough.
“I know when we do look for an attorney, we have a large amount of candidates to weed through,” said Critchfield, whose firm currently has eight attorneys.
According to the U.S. Department of Labor, Bureau of Labor Statistics, the number of lawyers is expected to increase 13 percent from 2008 to 2018, with an approximate number of lawyers expected at 857,700 in 2018.
That’s about average growth for professionals. But attorneys will face competition from accounting firms and paralegals, both of whom are performing legal functions — and corporations are using them more often to save money.
With ever-growing competition, newly graduated lawyers might accept jobs outside the traditional field, at temporary staffing agencies, or accepting managerial positions in banks, insurance firms and other companies. Of course, the higher the grades, the better the prospects for graduating law students.
As it stands, new attorneys have a number of options — self employment, working for the government, working for a nonprofit, working for a corporation, or working for a big law firm. The average lawyer salary, according to simplyhired.com, is $72,000.
“The competition is pretty stiff out there,” said Critchfield. “I would think it’s hard to find a job very quickly.”
For practicing attorneys with established firms, the economic forecast is bright.
“Business is great right now,” said McDowell, adding the firm plans to expand its operations.