This is the latest installment of The Daily Record’s Maryland Lawyers Confidence Index, a confidential survey of private attorneys in the state sponsored by the Maryland State Bar Association that explores their views on the economic factors influencing their practices. If you’d like to participate in our next survey, please sign up. Also, dive deep into our data visualizations of the results of this survey.
Nearly half of respondents in the latest Daily Record-MSBA Maryland Lawyers Confidence Index Survey said their firms planned to invest soon in new technology. The second-quarter survey had 258 respondents, down from 354 in the first quarter of 2019.
Forty-five percent of respondents in the second quarter said they planned to invest in new technology in the next three months, a 4 percentage point jump over last quarter.
“They’re investing in technology to keep up to date with the best and newest,” said Hilary Farace, a Baltimore-based branch manager at Robert Half, a recruiting company for legal and business staff. Farace added that many established law firms were looking to replace outdated technology.
Plans to invest in new technology were seen primarily in firms that employ more than 16 attorneys.
“Larger firms have been investing in technology for years, so that doesn’t surprise me at all,” said Randi Lewis, a Maryland-based recruiter with Major, Lindsey & Africa, a worldwide attorney search firm. “It is a must-have for firms of most sizes to keep up with technology so that they can streamline their processes and add greater value to their clients.”
Confidence in legal market, economy
Respondents’ overall confidence in the legal market, on a scale of -100 to 100, was 5, which is greater than the first-quarter number — 0 — and greater than the highest overall confidence level last year, which was -4, reported in the fourth quarter.
Overall optimism about the economy also improved, with 58% of respondents saying the overall state of the economy was good, up from 51% in the first quarter of 2019.
Views on the economy can differ based on a law firm’s scope and reach, said Sheela Murthy, founder and president of Murthy Law Firm, which specializes in immigration law.
“Big firms have the ability to withstand mobility and sudden changes up and down, whereas smaller firms tend to have a smaller bandwidth,” Murthy said.
The areas where law firms conduct business and firms’ investments in the stock market can also affect these perspectives, Murthy said. Many larger firms work with clients abroad and tend to have larger investments in the stock market than do smaller firms, factors that Murthy said provide larger firms a “big picture” view of the economy.
Thirty-seven percent of second-quarter respondents were women, up 4 percentage points from the first quarter of 2019. About a quarter of all respondents practice in Montgomery County, while 21% were in Baltimore city and 15% in Baltimore County. More than 60% of all respondents have practiced for more than 20 years. Eighty percent said they participated in their firm’s hiring process.
As interest in artificial intelligence grows and as companies develop new time-saving products, more law firms are looking to automated technology to accomplish everyday tasks. According to a report from Tracxn Technologies, a company that uses artificial intelligence to track startup growth across industries, investments in legal tech companies jumped from $233 million in 2017 to $1.7 billion in 2018.
More than 50% of survey respondents said artificial intelligence and technologies that automate processes would be the biggest contributors to the rate of law firm change over the next five years.
“Artificial intelligence in general has allowed us to do more of what lawyers should be doing,” said Joyce Kuhns, a Baltimore-based principal at Offit Kurman, a large mid-Atlantic law firm.
Kuhns, who said new technology helps law firms cut costs and improve efficiency, added that artificial intelligence could replace some routine jobs such as contract downloading but that jobs requiring analysis will still depend on lawyers.
Murthy said that being able to connect quickly with customers to answer questions and to update case information is another reason law firms are turning to artificial intelligence and new technology.
“You absolutely want to show your clients that you’re bringing your A game,” Murthy said.
- Forty-five percent of respondents indicated their firms were likely to see an increase in business and in the number of billable hours over the next three months. That rate held steady from the first quarter of 2019.
- Most survey respondents indicated they were unlikely to hire attorneys in the next quarter. However, 36% said they were likely to hire support staff, a 7 percentage point increase from last quarter’s figure.
- Forty-four percent of respondents said their firms were likely to invest in marketing and business development, down 2 percentage points from the first quarter.
How the Maryland Lawyers Confidence Index was done
The confidential survey was emailed to The Daily Record’s master database of subscribers, who were asked if they were attorneys in private practice who did not work for a government agency or for a law school. Respondents who chose “yes” were taken to the survey, which had seven questions.
The survey was also sent to members of the Maryland State Bar Association, the survey’s sponsor. The survey was conducted by Best Companies Group, an experienced market and consumer research company in central Pennsylvania that is owned by The Daily Record’s parent company. The results were compiled by Best Companies.
An index score for each question and for the overall survey was calculated by taking the (total positive responses – negative responses)/total responses x 100.
Would you like to participate?
If you are an attorney in private practice in Maryland and would like to participate in the quarterly Maryland Lawyers Confidence Index survey, click here. Your name and your survey answers will be confidential.