A wide majority of chief legal officers expect a recession and therefore have taken steps to curb spending on in-house and outside counsel, a new survey reports.
The Altman Weil Chief Legal Officer Survey released Tuesday found 76 percent of chief legal officers in corporate boardrooms believe there will be a recession within the next two years. The survey respondents said they expect manufacturing and consumer products companies to be hardest hit.
“Many law departments pulled back on in-house and law firm expenditures in 2019, and fewer plan increases to lawyer staff in 2020,” Altman Weil principal and survey author James Wilber said. “The changes are moderate, but we see a contraction across all key indicators.”
Among the other survey findings:
- 40% of law departments increased their total budget in 2019 while 38% decreased overall spending. The finding is a steep drop from 2018, when 53% of departments increased spend and just 29% cut budgets.
- 27% of corporate legal departments increased their spending on law firms in 2019, down sharply from 42% that did so last year. Perhaps a silver lining in the stats for law firms: departments cutting spending on outside counsel was up only slightly: 34% in 2019 compared with 32% in 2018.
- 36% of law departments plan to add in-house lawyers in the next 12 months, down from 42% in 2018.