Management Matters: 2021 Economic Survey takeaways
Vol. 78, No. 1 / Jan. - Feb. 2022
Trevor Mulholland is director of member services for The Missouri Bar.
In the summer of 2021, The Missouri Bar Economic Survey was administered to a random sampling of 8,000 lawyers licensed in Missouri. The 2021 survey provides a snapshot of the economic performance of the legal profession in the state as of Dec. 31, 2020.
Respondents shared data that allows Missouri lawyers to evaluate their firm’s performance relative to comparable law firms in terms of geographical location and other indicators. The report also provides economic information about Missouri’s lawyers who practice as solo practitioners, government attorneys, and corporate counsel, as well as those who work in law-related and non-legal professions. Below are some key findings from the survey.
From 2019-2020, income increased for 22% of respondents, stayed the same for 23.1%, and decreased for more than half (54.8%).
While 2020 provided salary growth for those in corporate law, lawyers in private practice saw a decrease in income. Although the 2018 median income for private practitioners was $115,000, the median income in 2020 dropped to $103,743. This portion of the survey was limited to full-time lawyers.
Factoring for gender and age
Looking at total net income for all types of employment by gender in 2020, the median income for female respondents was 77% the total median income of male respondents. Comparatively, the 2018 median income for female respondents was 71% of the total median income of male respondents. Median income was down across all age groups in 2020, except among respondents who were 31-35 years of age. As was true for most survey years, the highest median income from all employment sources was the category of individuals licensed to practice law 30-39 years; however, the median income for this group — $105,743 — was substantially less than in previous years.
As one might expect, the COVID-19 pandemic played a role in shifting work behaviors among practicing lawyers. The 2021 Economic Survey asked lawyers for information regarding caseload, benefits, work hours, and office settings. A large majority of respondents moved to teleconferencing/virtual meetings and worked remotely. Interestingly, about equal percentages of respondents had increased caseloads as had decreased caseloads.
Taking actions and future expectations
In addition to HR/personnel-related changes, at least 10% of respondents working in a law-related field reported other pandemic-related actions in their workplaces, the most common being delays or reductions of equipment purchases. When asked to anticipate how COVID-19 will affect their budgeting and finances for the upcoming year, more than one in five respondents anticipated a decrease in revenues. Notably, a similar percentage did not expect the pandemic to affect their budgeting. There was a great deal of uncertainty about the pandemic’s effects on budgeting and finance as expressed by the 45% who were unsure.
Changes in employment, underemployment, and unemployment
In 2020, 15.4% of respondents changed jobs, with 14% of those being by choice. Around 31% of these respondents reported their unemployment was somewhat due to the pandemic, while 36% reported it was completely due to the pandemic. The unemployment rate among survey respondents increased from 2.1% in 2018 to 2.8% in 2020. Approximately 12% of respondents are actively seeking new employment, with 19% of those respondents preferring this new employment be non-law related.
Private practice workplace characteristics
The 856 respondents in full- and part-time private practice for at least half of 2020 were asked a series of questions concerning office practices, such as billing, marketing, and office organization.
One-third of full-time respondents reported working less than 1,500 hours. For those lawyers in a firm with a requirement of 1,751–2,000 billable hours to be worked, 32% worked fewer than the required 1,751 hours, while 68% met or exceeded the requirement, with 23% of these lawyers clocking over 2,000 hours. The top five expenses charged to clients included lawyer time spent on the phone; court appearances; reading and responding to email; in-office appointments; and travel expenses.
Firm websites and networking continue to be the top two practices for advertising legal services, while social media, professional organizations, and speaking engagements round out the top five methods. In addition, lawyers indicated that their top source of new clients comes from client or friend referrals, followed by referrals from other professionals. Lawyers also noted that a positive reputation, firm website, and social or business affiliations provide client leads.
Missouri lawyers can access the full report at MoBar.org/EconomicSurvey to learn more about the state of the profession – and how they compare.