iCrowdNewswire
Tuesday, April 23, 2024 at 9:00am UTC
Average law firm partner rates rose 5.4% in 2023, the highest levels since the first CounselLink Trends Report in 2013; Median partner billing rate in 750+ law firms is 61% higher than the next smaller tier
RALEIGH, N.C. —In 2023, law firm billing rates rose at a record-setting pace with partner billing rates up, the highest levels recorded over the last 11 years, an exclusive new report has found fromLexisNexis®CounselLink®, a leading cloud-based enterprise legal management solution for corporate law departments.
Average partner rates increased by 5.4% in 2023, up from 4.6% in 2022 and 3.4% in 2021. The 2023 boost to partner fees crosses all law firms and practice areas except Environmental.
Law firms of 750+ lawyers, considered Large Law, continue domination in share of wallet with a median partner billing rate 61% higher than the next tier. The gap in billing rates between Large Law and other tiers continues to widen.
“In this global economy affected by inflation, supply chain issues and regional conflict, the impact on legal services is significant,” said Pamela Gelfond, Vice President of LexisNexis CounselLink. “Our report provides a comprehensive snapshot of how these market factors affect the dynamic between corporate legal and law firms. We’re hopeful that the insightful data in this CounselLink report provides what’s needed for our clients to successfully maneuver these shifting sands.”
The CounselLink trends report draws on the extensive CounselLink database of more than $59 billion in legal spending across more than 460,000 timekeepers and more than 1.6 million matters. It provides detailed insights on seven key metrics, including law firm partner fees by firm size, hourly rates by practice area, firm size, and location, and a snapshot of hourly rates in 18 countries.
Other key findings in the report include:
- Despite reports to the contrary, there is no indication that clients are moving legal work from Large Law to mid-sized firms. The largest tier of firms has shown growth in share of wallet over each of the last two years, from generating 45.5% of legal billing in 2021 to 48.2% in 2023.
- Large law firms particularly dominate the market in Mergers & Acquisitions, Finance Loans & Investments, Corporate, Commercial and Contracts, and Regulatory & Compliance. Within these five practice areas commanding the highest billing rates, Large Law increased its share of wallet from 59.0% in 2022 to 60.3% in 2023.
- In 2023, the median partner in the largest law firms billed at a rate that was 61% higher than the median partner in the next tier of firms, the largest gap in partner rates recorded in the CounselLink Trends Report since 2013. The differential in 2022 was 49%. The Median partner rate in Large Law was $991 per hour in 2023 compared to $615 per hour in the next tier.
- Significantly, as partner rates continued to rise in 2023, matter rates did not rise across most practice areas. This indicates that management of matter mix (rates, timekeepers, alternative fee arrangements) is working favorably for corporate legal.
“Every day, corporate legal faces budget management challenges and the pressure of higher outside counsel fees. The insights provided in our CounselLink Trends Report add a layer of needed intelligence to gauge satisfaction with record-setting fees compared to the quality of legal services delivery,” said Gelfond. “New data in the report indicates share of legal spend for new matters showing a slight shift in how organizations award them. The CounselLink benchmarking database, a gold mine, enables us to spotlight analytics that benefit legal department performance.”
The CounseLink 2024 Trends Report: Dynamics Shaping the Future of Legal, now in its 11th consecutive year, is available here.
About CounselLink®
LexisNexis®CounselLink®is a leading enterprise legal and contract lifecycle management solution designed to help corporate legal departments gain visibility into their work, matters, contracts, vendors, and financials. CounselLink delivers Work Management, Financial Management, Matter Management, Contract Lifecycle Management, and Vendor Management solutions in one easy-to-use, cloud-based platform for controlling costs, maximizing productivity, and making better decisions — all supported by powerful analytics that provides data to demonstrate legal department value across the enterprise. For nearly 30 years, LexisNexis has been providing innovative solutions for corporate legal departments crafted from the insights of thought leaders, industry expertise, and customer feedback. Visit us online.
About LexisNexis Legal & Professional
LexisNexis Legal & Professional® provides legal, regulatory, and business information and analytics that help customers increase their productivity, improve decision-making, achieve better outcomes, and advance the rule of law around the world. As a digital pioneer, the company was the first to bring legal and business information online with its Lexis® and Nexis® services. LexisNexis Legal & Professional, which serves customers in more than 150 countries with 11,800 employees worldwide, is part of RELX, a global provider of information-based analytics and decision tools for professional and business customers.
Media Contact:
Tracey Iverson, CounselLink
tracey.iverson@lexisnexis.com
Tags: Corporate Counsel, CounselLink Trends Report, law firm billing rates, LexisNexis, Outside Counsel
