Mark Levine, Managing Director, discusses the in-house market in 2024 and shares his predictions for the coming year
From Mark Levine
This time last year this article started off: 'The market for in-house lawyers has remained incredibly strong in 2023'.
Well... The same couldn’t be said for the first nine months of 2024, which was a noticeably quieter recruitment market. Thankfully, however, there has been a bounce back to 2023 levels of recruitment since the beginning of October.
So, what has been going on? This is what we have picked up in the market.
Political uncertainty
High interest rates and the pre-election period either put a hold on companies deciding to recruit or meant their efforts were focused elsewhere. Post-election, although costs associated with the rise in minimum wage and Employer NI have caused concern, it does feel like organisations are more focused on their business strategy, at least where it comes to the requirements of their legal teams.
We say “requirements”. Really it is necessity! Never have legal teams had such a full workload, and, often, only a proportion of their work is “pure legal”, with other areas such as compliance, commercial strategy, data protection, company secretarial, health and safety and in some cases D&I all landing at the door of legal.
Regarding the increase in Employer NI, with private practice lawyers having seen large increases in pay, law firm costs are only going to go up, and it will be their client base who pay these extra costs.
The case for in-house lawyers as a 'defence' against using expensive external counsel has to be one solution to this problem.
Our annual wish is for the market for in-house lawyers to remain strong in 2025.
London and the regions
Splitting the market into “London” and “the Regions outside of London”, in 2023 we saw approximately 600 legal moves across The North West, Yorkshire and The North East, The Midlands and Northern Homes Counties. By comparison, in 2024 we have counted 460 moves – close to a 25% dip. Quite a difference.
London is too big a market to keep a hold of all the data but at each General Counsel event attended in the capital a hot topic of conversation was how depressed the market was in comparison to 2023.
Trends and developments
Much remains the same as 2023, with commercial lawyers, especially at the junior to mid-level, remaining hard to secure. To remind yourself of our 2023 update please click here.
What have we seen different in 2024?
- We found increased interest among Legal teams to fill roles on an interim basis. The clients that have tried to “peg” salaries at a permanent figure have struggled to recruit compared with those with a more flexible budget.
- Working patterns: interestingly, we have seen some businesses return to five days in the office, with many more moving their recruitment mandate from being based anywhere to one where lawyers can come into the office 2-3 days a week.
At events for in-house lawyers this year two topics have been of real interest:
- How to build a business case for additional in-house legal hires.
- How can in-house “compete” in the war for talent against the salaries on offer in private practice?
Some thoughts for Q1 2025
Securing approval for an additional hire feels like a big challenge to most of the teams we deal with. It’s hard to show tangible value in the way that a sales team or procurement team can, especially when so much of risk management is about preventing loss in the first place.
How do you quantify the value of the disaster that didn’t happen because of the well-drafted agreement or well-conceived governance?
Based on our research with multiple senior lawyers this year some factors to consider are:
- External spend: The easiest way to a CFO’s heart is through profit and loss. Law firm costs are rising: how much did you spend on external advice last year and how much of that could come in-house, creating an overall reduction in cost? This feels like the best place to start but it does require detailed costing and forecasting to maximise impact.
- Can systems help to underline this point? Track numbers of instructions to compare against previous years or show where work is best serviced by a paralegal or legal tech.
- The cost of non-compliance: Listed or not, the penalties for corporate non-compliance continue to grow – how can that be quantified?
- What should you stop working on? If workloads are untenable what would the business like to see you give up if additional staffing isn’t an option?
- Start early: allow time for preparation of the business case and avoid a knee-jerk reaction.
Asking for budget in today’s business climate isn’t easy but looking at the value an in-house function can bring feels like a worthwhile task for any legal department head!
Some thoughts moving toward Q2
There is no “magic solution” to the PP salary “problem”' but here are some things to think about:
- Everyone is struggling with the salary increases being offered at law firms.
- Be open minded when recruiting: a more senior lawyer might have the right motivations for your role and might not be so demanding on salary requirements.
- Think of growing your own – this can be done directly or with the help of SQE providers like Barbri or Flex Legal.
- Outsource legal churn work to countries that offer lower salaries.
- When interviewing, understand your need to sell – your company, the difference of being IH to PP, opportunities for growth/potentially working in different countries.
- Sell your corporate culture – it is often more important to junior lawyers than you might think.
- Find the needles in a haystack – the ones that want to leave Private Practice for In-House, and for the “right reasons”. And recognise that an experienced legal recruiter is likely to know more of these individuals than your internal recruitment teams, who most probably don't spend every working day of their lives networking with the legal profession.
- Look earlier than when you actually need an extra person. And take the right person when you find them!
BCL Legal In-House Legal Community events
Finally, it has been a great return to in person legal community events and we have been delighted to partner with so many great organisations to offer a diverse and interesting programme to our in-house legal contacts.
For more about these events please click here.
With thanks to everyone we have supported or met with throughout 2024. We will be here for you once again in 2025.
