At the end of fiscal year 2018, a year of unprecedented growth in the Australian legal market, the overall feeling after was one of optimism, but also tempered with caution.
Many legal market observers believed that this level of growth was not entirely sustainable, yet the common warning signs of impending contraction were notably absent.
Into this mixed picture, a new report, 2019 Australia: State of the Legal Market, is released by Thomson Reuters Peer Monitor, Acritas, Alpha Creates, and Barolsky Advisors that outlines the major trends impacting the legal market in 2019 and investigates what is going to drive innovation for 2020.
The report shows that 2019 was still largely positive, and the market continues to outperform the majority of global legal markets in terms of growth — but in the back of some observers’ minds, the fear of reaching the ceiling persists.
You can download your own copy of the “2019 Australia: State of the Legal Market” here.
The report also details how such massive levels of growth seen in 2018 compares to 2019 in the wake of such boom conditions. For example, when The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry issued its Final Report in February, which lead to a contraction in demand in Q4, and left the door wide open for whatever 2020 has in store for Australia.
Among the key metrics examined in the report, were that demand increased on average by 3.9%, and revenue was up by 7.0% by year’s end. This was in part due to the above-average rate increases of 2.2% this year, after being relatively flat in 2018.
Other key findings include:
- Qualified fee earners (QFE) showed significant growth of 5.7%;
- Utilisation, or the average amount of hours worked per QFE, decreased by 1.6%;
- Corporate (General) was the fastest growing practice area (10.2% growth YoY); and
- The Sydney Market experienced the greatest increase in demand.
To be sure, 2020 is sitting in the wake of a financial boon, which is uncharted territory for the legal services industry in Australia, making the importance of keeping well informed of the shifting tides invaluable.