THE country’s largest 100 law firms generated a 4.7% increase in fee income through a combination of employing more fee earners and charging more than a year earlier.
The top 25 firms saw their fee incomes driven by rates, although there was a divide, according to Deloitte’s latest Quarterly Legal Sector Survey. The top 10 enjoyed average fee income increases of more than 5% in the three months to October while firms ranked 11-25 had more modest growth of 2%.
The rest of the top 100 also enjoyed average growth above 5%, which was largely driven by a 4% increase in the number of fee earners.
Clare Boardman, restructuring services partner and legal sector specialist at Deloitte in Yorkshire, said: “This quarter was a particularly strong quarter for the largest firms with strong demand in certain practice areas and an increased focus on pricing and profitability driving growth.
“For firms outside the 1-10 size category, increases in fee income have largely been achieved through growth in fee earner numbers rather than increases in chargeable hours per fee earner or rates. A focus on pricing and profitability will be key in the second half of the financial year given some of the pressures firms are seeing on fee earner salaries.”
However firms are bullish about the current third quarter, ending in January, and are forecasting a 6% increase in average fee income. The first six months of the financial year had an overall increase of 4.5%.
