The 4 drivers of change that are altering the legal market forever

18 Nov 2013

Those within the legal market will be aware that our industry is changing, but just why is this and what are the forces – internal and external – that are causing these changes?

Essentially, there are currently four ‘drivers’ of the changes that we see happening around us. All of these drivers will produce irreversible effects on the marketplace, which will have lasting implications for those of us who work within the UK legal profession.

Deregulation

Perhaps the most visible and most debated of all of the drivers, the deregulation of the UK legal market, is already having an effect on how UK law works. The changes it brings with it will only increase over both the short and long term.

These changes include an inevitable flood of new market entrants, new ideas and a general growth in both market size and competition. As these factors continue to escalate, the downward pressure on fees we have seen in some areas already, will increase.

Economy

Though the economic recovery now seems to be well under way, the legacy of the last five years will continue to loom large over the industry, with banks in particular still operating cautiously.

Though we are moving into a brighter period, we’re far from prosperity and the economy will continue to put pressure on the industry’s performance over the next few years.

Regulation

Whilst the market is now more open, the cost to businesses of complying to regulation continues to rise; both in monetary and workload terms.

With the changes in the professional indemnity insurance market also having an influence, the costs and logistical implications of regulation will only grow, causing businesses to change processes and/or spend more time on regulatory concerns.

Politics

Political pressure on areas of the industry (such as PPI) are already having an effect and with politics being far from predictable, there’s nothing to say that further changes aren’t just over the horizon.

A likely change in the small claims limit may well just be the first of many alterations firms will have to adapt to, on the back of changing political thinking.

 

For more on this and other topics around the future of the legal industry, download our white paper, The Lawyer of the Future, here.