2020 was both a stress and exciting year for the legal industry. As new legal tech solutions and alternative work models continue to emerge, the legal market is becoming increasingly competitive and is constantly evolving. A number of the trends we saw this past year will continue to shape the way we practice law in the year to come.
The following are some trends you can expect to see shape the legal industry in 2021.
Economic Implications of Coronavirus
The impacts of the ongoing coronavirus pandemic are unprecedented. The virus is rapidly leading to record-setting business losses, widespread unemployment and obvious healthcare concerns. We are facing a potential economic recession as a result, which may lead to record unemployment numbers, growth in personal debts, increasing foreclosures and astronomical medical costs. This is likely to result in new regulatory action, which is common during economic downturns. Attorneys play leading roles in the rulemaking process for state and federal agencies, which must update and implement important regulatory changes to keep up with other leading trends of society.
Work-Life Balance and the New Generation
More and more people are seeking out job opportunities that provide them flexible schedules and an amicable work environment. This is especially true with newer generations, which prioritize work-life balance. As firms grow, they must welcome a multi-generational workforce. Modern employees are more productive in workplaces that provide benefits like telecommuting and flexible hours. Additionally, individuals seek out places that value diversity and inclusion, as well as a team of supportive and connected colleagues.
Growth: The rise of nonlaw firm competitor
Nonlaw firm providers are gradually taking work away from law firms, Prescott says, noting the three primary competitors are accounting firms, consultants and contracted lawyer services.
As mobile devices have become more and more common, lawyers have been taking increasing advantage of the ability to work remotely. The days when lawyers were tied to offices are over. In 2021, we’ll see even more attorneys working from home offices and just generally on-the-go
Just as lawyers are detaching themselves from the office, many are detaching themselves from the formal law firm structure entirely. Once a rarity, legal freelancing is now a viable career and freelancers are in increasing demand. Expect to see more lawyers opting for the freelance life in the coming year.
As technology has advanced and mobile devices have proliferated, the need to cart around boxes of documents has greatly diminished. The amount of documents that once filled an entire conference room can now be accessed on a laptop or iPad, freeing lawyers from a life surrounded by mountains of paper. You should expect to see even more practices going paperless in 2021.
The fastest growing cost category in law firms today is technology. Prescott says too many firms under-invest in technology until it’s too late. Security issues plaguing the profession today are enormous. “Firms tend not to make the investment until they are hacked and once you lose data, it’s almost too late,” he says. “The biggest reason that happens is partner autonomy overrules client interests, firm priorities and profits.” Prescott says he’s seeing some displacement of lawyers by technology but that it’s more of a trickle than a flood. He says more companies are investing in software that will create the first draft of a contract, draft a patent application or create an outline for completing a merger.
Few things have changed the practice of law in the past decade as much as the advent of legal technology. It seems that new solutions are emerging every day, and that trend won’t stop any time soon. We should see even more legal tech solutions entering the market in the coming year to make lawyers’ lives even easier.
Technology has not just changed the practice of law, it has revolutionized the discovery process. eDiscovery has been on the rise in the past decade, and we’re at the point where traditional paper discovery is nearly a thing of the past. As technologies continue to evolve and we see more and more new file types being created, the world of eDiscovery will only continue to grow in 2021.
Social media isn’t just for sharing clever memes and viral cat videos any more – it’s a legitimate tool for marketing and even doing business. Lawyers have increasingly come to embrace the power of social media and its potential for growing business. While that trend is likely to continue in the coming year, we should also expect to see the ethical issues surrounding the use of social media in the law being explored more fully.
Online and Cyber-Security
Technology has unquestionably brought new levels of convenience to the practice of law, but with that convenience has come a new potential threat to data security. Cyberattacks are a new reality of doing business in the 21st century, and hackers will continue to refine their tactics and come up with more sophisticated methods to illegally access data and funds. In 2021, we’re likely to see continued vigilance on the cybersecurity front as lawyers try to stay ahead of would-be attackers.
The viability of the traditional billable hour model has been under fire for some time now, and that debate will continue in the coming year as clients increasingly push back on high legal bills and demand more efficiencies. In the coming year, we’re likely to see even more practices abandoning the billable hour in favor of alternative fee arrangements.
Legal Process Outsourcing
As part of the desire to curb legal costs, more and more companies have been looking beyond traditional law firms for legal services, turning instead to alternative legal service providers that promise greater efficiency and lower rates. Today, companies are outsourcing nearly every routine aspect of legal practice. While traditional law firms will never disappear, we’re likely to see even more legal process outsourcing in 2021.
We’re in the midst of a clear generational shift in the legal industry. As baby boomers are retiring in increasing numbers, millennials are graduating from law school and entering the workforce. With them they’re bringing an increased reliance on technology and a desire for alternative work arrangements. Millennials will be the major drivers behind a majority of the trends that will shape the legal industry in 2021.