ABS: what do they mean for trainee recruitment?
updated on 10 May 2012
The other day a journalist called me up to ask what I thought the impact of alternative business structures (ABS) might be on the recruitment of trainees in the legal sector. Here are a few of my initial thoughts:
- There is a distinction between the retail and the corporate part of the market. It is widely predicted that the creation of bigger high-street legal brands (not least by those promoting these brands) will spur a greater use of legal services by the public and thus grow the sector. In turn, one might expect this to create more lawyers.
- However, if ABS influence leads to harder nosed, leaner business models, more tasks that have traditionally been performed by lawyers (and mainly lawyers at the more junior level) may be reallocated to paralegals or other staff who have not passed through the extensive and expensive rigours of qualification as a solicitor.
- ABS influence might also accelerate the consolidation of the legal market into fewer organisations with greater economies of scale, which may again lead to the tendency described in point two. There may also be a geographical shift with some tasks (and thus workers and opportunities) moved to cheaper regional or even foreign locations. See the recent activity concerning outsourcing to Bristol.
- But new entrants into the market might well lead to innovation and expansion that grows the market and creates more demand for lawyers.
Obviously, this is all bound in with what comes out of the LETR as well. Its objective is to widen access and routes into being 'a lawyer' so it is hard to see any outcome but some shift away from the training contract model, although the big commercial players will inevitably stick with something that looks very like the training contract for their elite recruits.
In conclusion, I would suggest that ABS involvement will certainly grow the market for paralegal and related positions but it is important to recognise that the biggest cost in a law firm enterprise is lawyers; maximising their output (probably at the expense of headcount) will inevitably be part of a firm's plan.
