Smaller law firms seeing upturn says survey
SMALL and medium-sized legal firms are seeing signs of an upturn in fortunes, according to a Law Society survey.
Research from the Law Society Law Management Section’s annual profitability survey, reveals that on average fee income rose slightly – by 0.2 % in 2010 – a significant improvement on the 6.5% fall seen on 2009.
The survey, sponsored by Lloyds TSB Commercial, shows that employee costs fell last year, but average net profit per partner rose 18.6% to £106,297.
Median fee income per equity partner was £455,650, down from £469,666 in
2009, while the average cost of a fee earner was £40,240 compared to £43,938 in 2009, a fall of 8.4%.
Law Society President Linda Lee sayid: “Although there are signs of recovery, progress is slow and firms will be looking at how they can continue to grow as we emerge from the recession.”
Christopher Parker, senior manager, specialist markets for Lloyds TSB Commercial in the North West, says: “In many ways this year’s survey shows a steady, consolidating scenario, but two things struck me.
“First was the increase in median net profit per partner from £89,621 to £106,297. But more important for me was the measure of profit after deducting a realistic notional partner salary – at 7.3% of fee income this is a terrific improvement on the 2.3 per cent shown in the 2009 survey.”
In its 11th year the survey, is widely regarded as the annual health check report for the smaller end of the legal profession.
The Law Management Section of the Law Society, is designed to assist those in the management of legal practices.
