Fee income on the up for law firms in first half of the financial year has been saved
Fee income on the up for law firms in first half of the financial year
22 December 2015
- UK top 100 law firms increased fee income by 4.7% in Q2 of FY16;
- Increase in fees per fee earner of 1.6%;
- Overall increase in fee income of 4.5% for the first half of FY16.
The UK’s top 100 law firms achieved a fee income increase of 4.7% in the quarter ended 31 October 2015, compared with the same period last year. This resulted in an overall increase of 4.5% in the first half of the financial year, according to Deloitte’s Quarterly Legal Sector Survey.
Average fee income increases of just over 5% were achieved by firms in the 1-10, 26-50 and 51-100 size categories this quarter, with more modest growth of 2% achieved by firms in the 11-25 size category.
While growth in the largest firms was achieved through an increase in the rates recovered, the growth for firms ranked 26-100 was predominantly due to increases in fee earner numbers of around 4%.
Jeremy Black, professional services partner at Deloitte, said: “This quarter was a particularly strong quarter for the largest firms with strong demand in certain practice areas and an increased focus on pricing and profitability driving growth.
For firms outside the 1-10 size category, increases in fee income have largely been achieved through growth in fee earner numbers rather than increases in chargeable hours per fee earner or rates. A focus on pricing and profitability will be key in the second half of the financial year given some of the pressures firms are seeing on fee earner salaries.”
The survey also found that participants expect a relatively strong third quarter, with firms predicting average fee income increases of 6%.
Notes to editors
This is Deloitte’s 34th Quarterly Legal Sector Survey of the top 100 UK law firms in the UK.
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
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