Today’s solo lawyers and small firms are facing a conundrum—not only are an increasing number of attorneys choosing to seek employment in the smaller firms that make up the backbone of the legal profession in America, but those firms are operating in a data vacuum when it comes to finding intelligence to support or oppose crucial business decisions.
Whether you’re looking to strike out as a solo practitioner for the first time or expand your existing practice, Clio’s Legal Trends Report can help. Drawing on aggregate, anonymous usage data from over 40,000 Clio customers and over $60 million in billing volume, the report provides, for the first time, surprising insight into what it means to practice law in a solo, small, or medium-sized firm in 2016, and answers common questions that attorneys looking to start or grow a law firm may have.
Where Should I Open My Law Firm?
When it comes to average billable rates by state, it’s no surprise that the District of Columbia, New York, and California rank as the big three—but they also rank first, second, and ninth for lawyers per capita, and all three rank in the bottom five states for relative purchasing power. For savvy attorneys who want to compete in less crowded markets—and want their billable hours to go further—Nevada, Connecticut, and Illinois emerge as the top options for practicing law, with Arizona, Georgia, and Florida also ranking highly.
When Should I Hire Another Attorney?
One of the more surprising findings from the Legal Trends Report was the shockingly low utilization rate—just 28 percent, or 2.2 billable hours out of every 8-hour workday—reported by attorneys. However, utilization seemed to scale as more attorneys were added to a firm, plateauing between five to nine attorneys.
If you’re debating adding another employee to your firm, the Legal Trends Report should put your heart at ease—adding another attorney will actually make you more productive. Unless, of course, you’re already a four-attorney firm, in which case you should just consider hiring six more at once.
When Should I Prepare for Additional Business?
Depending on your practice area, you may want to prepare for booms in business based on seasonality. Unsurprisingly, Tax Law sees a big boost to business in the first three months of the year. Our data on Family Law matters also confirmed the old adage that more divorces happen after the holidays, spiking in March and trending downward throughout the year. Personal Injury attorneys saw a steady caseload throughout the year, while Criminal Law saw seasonality that mimicked that of Family Law (no correlation confirmed).
Regardless of business size, today’s most effective leaders are leveraging data and smart insights to drive informed decisions. While solo lawyers and small firms have had to historically rely on underreported or self-reported data, the Legal Trends Report aims to give this segment of the legal market information that will impact their business in a positive way.
40,000 Lawyers Can’t Be Wrong: Learnings From the Clio Legal Trends Report (Sponsored) was originally published on Lawyerist.com.