(Reuters) - Demand for legal services dropped a median of about 5% in April, according to a recent survey of nearly 60 law firms, including some of the largest in the U.S., as the coronavirus pandemic shuttered courts and businesses nationwide.
One in five firms surveyed said demand for their services dropped 20% or more in April, Jeff Grossman, head of business development at Citi Private Bank Law Firm Group, which regularly conducts surveys on firms’ financial performance, said in an interview Tuesday. Litigation and transactions practice groups tended to be the hardest hit, he said.
While many firms in April had less work than usual the work they did have was more likely to be done by lawyers with more expensive rates, as clients sought counsel from senior attorneys, Grossman said.
The median revenue change in April was about flat, Grossman said. But there was a wide range in revenue results last month, making the median a more reliable indicator than the average on how most firms performed, he said. Revenue grew for very few firms, while roughly 60% saw revenue drop 10% or less.
The length of time it took the median law firm to collect on client bills grew by approximately 5% last month, though firms reported a wide range in changes to collection times, Grossman said. Longer collection times could impact revenue in May and June, he said.
Since the pandemic in mid-March sparked economic shutdowns across the country, more than 50 large law firms have announced cost cutting measures, such as layoffs, furloughs, pay cuts and shortened summer programs.