After a sharp +22% increase in demand for legal services in 2021 (when the Covid lockdown was lifted), the demand has climbed steadily ever since, with a +3% increase in 2022, and a +6% increase in 2023.
Looking ahead, the recent ½Û×ÓÊÓƵ Gross Legal Product (GLP) Index 2024 predicts a +2% growth in the demand for legal services for 2024 compared to 2023.
Given the geopolitical and macroeconomic headwinds the legal profession faced in the last 18 months, even a subdued growth of +2% is overwhelmingly positive. It shows the legal profession's resilience, ability to innovate, and drive to power forward.
However, we live in unpredictable times – growth could well accelerate beyond +2%.
Download the ½Û×ÓÊÓƵ GLP Index 2024
According to latest report, business confidence increased to 41% in August 2023, reaching its highest level since February 2022 (when Russia invaded Ukraine).
"We've seen a strong rebound in confidence, now higher than at any time since the Russian invasion of Ukraine and well above the long-run average. Business optimism is helped by the outlook on peak interest rates and the direction of travel on inflation," says Paul Gordon, MD for Relationship Management, Lloyds Bank Business & Commercial Banking.
According to the Lloyds report, the rise in business confidence was mainly driven by a marked rebound in economic optimism. Although the manufacturing sector does not share the overall confidence, there was increased confidence in retail, construction, and services.
Hiring intentions rose to a 15-month high, and the share of companies expecting a pay increase for their workforce also rose to a new high. Confidence increased in ten out of the UK's twelve regions and nations, with sentiment the most upbeat in London and the southeast.
According to Hann-Ju Ho of Lloyds, “Our analysis shows that businesses felt relief that interest rates may be reaching their peak, alongside hopes that measures to tackle inflation are having an impact. With trading prospects remaining stable, and hiring and wage intentions also rising, the macro environment for small businesses and those outside the manufacturing sector is more upbeat."
The general optimism could well rub off and accelerate growth in the legal sector.
Looking at specific areas of the law, the GLP Index predicts strong growth across property, immigration, restructuring, and insolvency law. After several years of decline, the growth in property and immigration law is very promising.
Demand for competition, plus risk and compliance law has flattened after experiencing steady growth in 2022 and 2023, while the demand for criminal law expertise continues to decline.
The property law workload is predicted to grow by +7% in 2024 compared to 2023. After the sharp drop of -12% in 2020, it is promising that growth is expected to increase by +7%, after a +7% increase in demand in 2023 as well. One of the biggest drivers for this increase is the growth in the number of dwellings completed in the UK.
View property law practice notes, precedents and news articles
The years leading up to the pandemic and during the pandemic were tough for immigration lawyers. However, since then, demand for the practice area has been steadily increasing, and the need for Immigration law services is predicted to increase by +7% compared to 2023. The main drivers behind this increase are a dramatic increase in the number of student visa applications, as well as an increase in citizen applications.
View immigration law practice notes, precedents and news articles
The index predicts a +6% growth in restructuring and insolvency law due to the turbulent economy taking its toll on many businesses. The increase in demand for legal services in this sector is mainly due to the rise in new company insolvencies. The numbers skyrocketed in 2022, and the latest figures show 55% more company insolvencies for 2023.
View restructuring and insolvency law practice notes, precedents and news articles
• Commercial law +4%
• Family law +3%
• Private client law +5%
• Tax law +2%
After three years of exceptional growth, the demand for competition law is predicted to drop by -5% compared to 2023. One of the reasons is the CMA being given more and more authority.
However, although there is a decline in demand, the index shows there is still huge demand for competition law expertise going forward.
View competition law practice notes, precedents and news articles
Although tricky due to the migration to a new tribunal case management system, the GLP Index used the Ministry of Justice's Employment Tribunal statistics as a key dataset for future prediction. Despite the rebounds in 2022 and 2023, the index predicts a decline of -2% in demand for employment law expertise in 2024.
This is partly based on the Employment Tribunal's 2022/23 figures, which show that 84,396 claims were accepted – significantly lower than in previous years. However, the total number of disposals sits at 71,316 – 71% higher than 2020/21.
View employment law practice notes, precedents and news articles
The index revealed the demand for criminal law has steadily declined over the years. Although there was growth in 2021, it dipped again in 2022 and 2023. Based on one of their key sources, the Minister of Justice's Criminal Justice Statistics Quarterly, the GLP Index, predicts a decline of -3% for 2024.
Other areas of the law, such as corporate law, remain the same from 2023 to 2024, while risk and compliance law will see a slight decline of -1%.
View corporate criminal law practice notes, precedents and news articles
Read the complete ½Û×ÓÊÓƵ GLP Index for more details on the practice areas that will experience growth or decline in 2024.
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