“Double Whammy on Law Firms: COVID-19 and The Troubled Economy” by Sharon Nelson and John Simek was featured in the June 2020 San Bernardino Bulletin.
When lawyers turned the calendar page to January 2020, they could not have dreamt of the two-fold nightmare that would descend upon the profession so quickly. A global pandemic and a tanking economy at the same time? We thought we had seen the end of hard times when we finally emerged from The Great Recession in 2009. Some of our lawyer friends still have lines of credit to pay down from that recession.
While government leaders say the economy will “come roaring back” or “I’ll bring the economy back,” most lawyers are skeptical, to say the least.
The New Normal
What have we seen so far? Beyond the fact that virtually all lawyers are working remotely, with some phased re-opening in the works, we have seen dismal news.
Clio’s survey, released in May 2020 showed that during March, new legal matters were down more than 30% compared to the first five weeks of 2020 and down by more than 40% from the year’s highest weekly averages. 56% percent of legal professionals say they have seen a serious reduction in the number of people asking for legal help, and 53% say they are significantly less busy.
Though understandable, 49% of companies say that if they had a legal issue now, they would probably delay getting legal help until the pandemic has receded.
Sixty-seven percent of lawyers are worried about the success (and even the survival) of their practice and 57% are worried about making a living over the next few months.
The survey found that 75% of legal professionals report higher levels of stress and anxiety, and nearly half are more worried about their finances than their health. Not all lawyers are in pain. The bankruptcy attorneys are doing just fine – and other areas of law practice have not yet seen a decline.
Eleven percent of firms say they have already laid off staff, the survey found. Another 15% expect layoffs in the next three to six months.