Nicoletta Ravida workforce, Market Insight, Law Firms...
The last year has seen unprecedented growth across multiple industries all over the world. The legal markets have been no exception. Indeed, the Italian economy, for example, grew 6.5% in 2021. The knock on is obvious. Businesses have needed to recruit in order to keep up with demand, and this includes the recruitment of lawyers. And now, in 2022, with war in Eastern Europe and the outcome of a general election in France, the Southern European market remains strong, and it appears the political issues are not impacting as yet.
The candidate driven market continues
We have seen the demand for lawyers across all industry sectors at an all time high. From energy and sports to tech and e-commerce. And, what has been very interesting for our sector, has been the number of businesses who historically never worked with search consultancies before now looking to engage the expertise of an agency. This is because right now talent has never been more difficult to secure. And, these businesses have such high demands for talent that their internal recruitment teams simply cannot keep up with the volume, let alone secure the best candidates.
The obvious knock on in this busy market has been a dramatic rise in the salaries of junior lawyers and we have seen this across France, Spain and Italy. This is following a period of time where salaries remained fairly stagnant for a number of years, even before the start of the pandemic. Candidates have been reticent to move over the last year to 18 months and therefore, those that do go for it are demanding greater reward in order to take, what they perceive, as the risk of a move.
Lawyers generally are still looking to maintain some kind of hybrid working model and do not want to go back to full time in the office. Europe, on the whole, does seem to have adjusted to this way of working and we are generally seeing a 40/60 and 30/70 split (home v office).
Brexit hasn’t gone away
During the pandemic there were times when the impact of Brexit seemed almost forgotten. Now it does appear, for the recruitment sector anyway, the positives of the move may be starting to come out. With the world a changed place following the pandemic and with technology continually developing at lightening pace, it is easier for roles to be based anywhere. Making Brexit far more a positive turn than not in recruitment terms. We are also seeing many citizens of Southern Europe look to return home, giving law firms and businesses access to homegrown talent and lawyers who intrinsically understand the market and have local language skills.
Private Practice trends
In the last eight months, the private practice market in Italy has been dominated by the spin-off of lawyers from big law firms (both international and not) setting up their own law firms. A notable example is the departure of Avvocato Lorenzo Parola who, together with, Avvocato Fabio Angelini, left Herbert Smith Freehills to set up their own practice, “Angelini Parola” and, the “Latham&Watkins branch” of LMS who left to set up Target – Coppola Malaguzzi – Law firm.
Lateral hires are rare, and, in this regard, we have noticed that the most structured law firms prefer growing their talent internally and expanding with internal promotions: good examples of this trend are Hogan Lovells who recently promoted two new Partners, Legance who just appointed six new Partners and nine Counsel. DLA also recently appointed two new partners. This can be explained by the fact that there are few candidates on the market who can meet the high thresholds of client following required by the more structured firms.
New level for ESG and CSR
ESG and legal departments have long been connected. For years general counsel have had to keep on top of this and it has become a part of everyday life when running any kind of team. Legal teams have become more sustainable themselves and we have seen this already through the strong development of legal operations teams; through which departments look to become more efficient. However, we have seen some businesses take this to the next level and appoint a Sustainable Global Head of Environment Law. These roles take the responsibility off the shoulders of the General Counsel for the first time, and firmly lay out a path that the business expects to take around the environment and sustainability. Businesses need to show their shareholders they are serious about sustainability and balance sheets need to showcase how this can be profitable. ESG compliance is also now playing a major role in M&A deals. It is no longer a fleeting part of a transaction and now requires key consideration.
By creating a dedicated role for this, a business has the best chance of producing real results. We predict the number of these roles, at this senior level, will only continue to increase. This presents a real opportunity for many lawyers and gives them the opportunity to carve out a new niche for themselves even at the most senior level.
In Italy, we are seeing a big drive by the law firms, notably GOP, Bonelli Erede and Cleary Gottlieb, to develop their corporate social responsibility. Many are increasing their pro bono work and offering access to free legal services. They are also making moves to make their firms more inclusive and diverse. For example, Gianni & Origoni’s GOP Cares covers the full gamut of policies including the environment, social and governance, all with the aim to make the firm more sustainable.
If you would like more information on the market or you would like to discuss growing your team please get in touch with Nicoletta Ravida.