The past few years been an emotional time for lawyers operating in the UK legal services market. At a national and regional level, candidates had to cope with not only the massive economic fall out of the global economic crisis and increasing uncertainty over job security, but a overwhelming sense that the old order was beginning to change. Salaries stalled and the threat of redundancy loomed. Furthermore the passing of the Legal Services Act in 2011 added an extra degree of uncertainty. However in 2013, it seemed that the storm was beginning to break and by 2015 it could be that candidates may once again have the upper hand in a market crying out for their skills.
A rough ride
Although the legal sector proved to be comparatively robust during the recession, the profession went through a torrid time. NQ salaries decreased and recruitment budgets shrank. Furthermore, though certain sectors such as insurance, held firm transactional departments such as corporate and commercial property were sobering areas in which to practice.
In 2013, however it seemed that there might be cause for real optimism and by 2014 the legal industry appeared to be showing sure signs of recovery. This culminated when the Law Society published a detailed report on the legal sector in August of last year.
A national view of the legal services market
According to Law Society figures, growth in real turnover of the legal services market grew from 3.5 per cent in 2013 to 3.5 percent in 2014. This was compared to just 1.2 per cent in 2012. More significantly, further growth is predicted for 2015 with a further jump in growth by 4.9 per cent.
To put this into some sort of context, the Law Society estimated that the UK legal sector was worth around £26.8 billion in 2013 and expects this will increase to £27.5 billion in 2015.
All good news, then. But what does this mean in real terms for candidates seeking jobs at ground level? Without doubt, the larger firms have benefited from a slowly recovering global economic market. A highly skilled, professional work force has helped the large City-based and regional heavyweights win a larger slice of global transactions. Furthermore, at grass roots level, an improving residential property market has meant that the wheels of conveyancing departments are turning up and down the country.
A regional view – the search for talent?
The national picture therefore appears pretty rosy. But what of the regional perspective? Can candidates looking for legal jobs in cities such as Manchester expect to feel more confident about their career opportunities? To answer this question it is helpful to analyse the regional challenges faced by the legal service industry in the North West set against the national backdrop.
A focus on the Manchester legal services market in 2015
Manchester possesses a particularly interesting legal landscape. Like other major cities across the country, including London, the increased flow of transactional work has exposed a huge skill shortage with corporate, commercial and real estate departments struggling to recruit, especially at the mid level.
Candidates with the right skills are in higher demand as departments seek to grow in these healthier economic times. Furthermore, it is one thing hiring new talent it is quite another thing to keep it. With demand for skills increasing, numerous commentators have predicted salaries will continue to rise, though this will be measured as legal service providers seek to keep profitability closely in mind.
Candidates are undoubtedly in a far stronger position. A few years ago, fears over job security left many reluctant to explore opportunities elsewhere. Now, however, lawyers will no doubt see a rise in the number of career options available. More importantly, they are likely to feel more bullish about exploring them.
New kids on the block
However, whilst the above factors are common to all the regional economic centres, there are some factors that make the Manchester market rather unique. In particular, the legal landscape in Manchester has changed more than perhaps any other city outside the capital, presenting new opportunities for candidates looking to further their career. The recession saw a host of casualties and the arrival of some new contenders.
The fall of stalwarts such as Cobbetts and Halliwells has been well documented. So too has the arrival of the new heavyweights. Slater Gordon chose Manchester to establish its largest single office in the UK. Fieldfisher gained a foothold by merging with respected boutique Heatons and Nabarro exploded onto the scene attracting key players from major rivals. Other new arrivals include Berwin Laighton Paisner and US firm Latham & Watkins who will be developing business service team in the city in 2015.
But if you thought the New Year was going to usher in a period of consolidation, you would be very much mistaken. The impact of the Legal Services Act 2007 has been mooted for years now, but the full effect of Alternative Business Structures (ABS) is yet to be felt. Only in January 2014, was PwC awarded ABS status with rivals KPMG following in October last year. EY joined the party in December 2014 and plans to grow a significant legal capability in the UK.
With so many significant service providers competing in the same talent pool, 2015 could prove a very exciting time for ambitious candidates.
Is the candidate now king?
At a national and regional level, there is little doubt that the legal market is enjoying a period of positive growth. Spear headed by a continued global economic recovery, candidates looking for new challenges in 2015 should be in a fairly buoyant mood.
The North West in particular however is likely to offer some attractive legal job opportunities for driven lawyers in a market that is as exciting and as vibrant as ever.
To say the candidate is now king seems a little over the top. Legal service providers will still continue to seek out the very best candidates. Furthermore, there will be an increased focus on profitability in 2015. There is certainly no room for complacency. More interesting for candidates, howver, is how the structure of their legal careers is likely to continue to change over the next few years and how they will choose to build their careers in an increasingly dynamic market.