The numbers aren't promising: Law firm expenses grew faster than revenue during the first half of 2012 according to the latest survey by Citi Private Bank.
This study also revealed that transactional work is currently slower than litigation. While the pace of litigation hast often offset a slow deal market in the past, it now seems that corporate clients are in a stronger bargaining position, pressuring their law firms into discount for litigation work.
From Bloomberg Law:
Kent Zimmermann, consultant to law firms for the Zeughauser Group, talks with Bloomberg Law's Lee Pacchia about the prospects for the legal services industry in 2013. Kent says that law firms have seen such a steep decline in demand for corporate work in the last six months, that many large law firms will face serious economic turbulence going into 2013. Work is even off in Silicon Valley, thanks to the less-than-stellar Facebook IPO. As a result, Kent says law firms plan to "get lean" by reducing headcount over coming months. Kent also notes that unless the economy improves by mid-2013, three to five AMLaw 200 law firms could go out of business.