Why is BigLaw hiring while demand falls? 'Economically it makes no sense,' says consultant (video)
Bruce MacEwen, law firm consultant and publisher at Adam Smith, Esq., talks with Bloomberg Law’s Lee Pacchia about the current state of BigLaw–specifically, how billing rates can be rising as demand falls.
After analyzing three recent reports by Wells Fargo, Citi and Peer Monitor, MacEwen is puzzled. “The numbers tell a very odd story, and I’m not sure I’m enough of a psychiatrist to explain this, because economically it makes no sense,” said MacEwen. “Demand is down, revenue is down, realization is down, but headcount is up. So we already know we have overcapacity–and we’re adding people. I don’t get it.”
Pacchia and MacEwen offer some hypotheses as to how aggregate numbers may be providing a slightly misleading picture. “Still, the fact remains that across the industry–all three reports totally consistent on this–every measure of demand, productivity, utilization is down,” says MacEwen. “And they’re still hiring people.”
See the video interview here.
