Rising Salaries in Legal: What Employers Need to Know for Effective Hiring
The legal sector is experiencing a transformative period, with shifts in hiring practices, salary expectations, and candidate availability. As a recruitment startup specializing in legal professionals, we recognize the critical need for employers to adapt to these changes to attract and retain top talent. This blog explores the key trends, challenges, and strategies for effective hiring in the current legal market.
The Current Hiring Landscape
In the past year, the hiring landscape in the legal sector has undergone significant changes. Despite a slight easing in hiring competition, candidate shortages remain a pressing issue. Macroeconomic uncertainty has made candidates more hesitant to switch roles, further complicating recruitment efforts. To navigate these challenges, employers must stay informed about salary trends and adjust their strategies accordingly.
The Impact of Rising Salaries
One of the most notable trends is the salary increase across the legal sector. The competition for top talent has increased salaries, with some candidates securing pay rises of up to 40-50% since early 2021. This upward salary trend is influenced by various factors, including region, experience levels, specialisations, and the nature of the position (permanent or temporary).
Demand for legal professionals has been particularly strong at the junior to mid-level, reflecting existing firms' expansion and new firms' entry into the market. Employers must align their salary offerings with market expectations to remain competitive.
Emerging Career Paths: The SQE Effect
The introduction of the Solicitors Qualifying Examination (SQE) in 2021 has further impacted the demand for legal talent. The SQE offers an alternative route to qualification, replacing the traditional Legal Practice Course (LPC) and the two-year training contract with two years of work experience. While this opens new career paths for junior lawyers, it may also lead to skill shortages in certain areas.
Paralegals who previously did not secure training contracts often transitioned into fields like compliance, data protection, and governance. With the SQE providing an alternative qualification route, these specializations might face a reduced talent pool. The SQE could exacerbate the candidate shortage in these specialist markets.
In-Demand Skillsets for 2023
The legal sector's evolving landscape has elevated the importance of specific skill sets driven by wider market trends such as sustainability, cryptocurrency, and technological transformation. Within private practice firms, there is a growing demand in disciplines like:
Cryptocurrency and unregulated finance
Energy, clean energy, and renewables
Environmental, social, and governance (ESG)
Funds and securitization
Intellectual property (IP) and patents, both litigation and transactional
Technological advances
Leveraging Interim Talent
Given the persistent candidate shortages, interim hiring is becoming an increasingly popular solution. Temporary or interim hiring allows employers to expand their in-house legal functions without committing to a permanent headcount. This approach offers flexibility, enabling firms to match staffing levels with workload fluctuations and mitigate risks effectively.
Shorter notice periods allow for quick interim hires, making this strategy ideal for employers needing immediate talent. It's a practical solution for maintaining productivity and meeting legal demands in a tight market.
Understanding Legal Professionals' Priorities
To attract and retain legal talent, employers must align their Employer Value Proposition (EVP) with the priorities of legal professionals. Recent insights from our own data and insights, reveal that legal professionals prioritize career opportunities and challenging work. They are more likely to leave a role for these reasons compared to professionals in other sectors.
Furthermore, work-life balance is a significant factor for legal professionals, with 73% of respondents selecting it as a key priority for a new role, compared to 64% across all sectors. Employers need to present opportunities that offer both a good work-life balance and engaging career-advancing work.
Strategic Steps for Employers
To effectively hire and retain top legal talent in 2023, employers should:
Stay Competitive with Salaries: Ensure that salary offerings are competitive and in line with market benchmarks.
Embrace Interim Hiring: Consider interim or temporary hires to address immediate staffing needs and manage workload fluctuations without long-term commitments.
Highlight Career Growth: Emphasize opportunities for career advancement and challenging work to attract candidates seeking long-term career development.
Promote Work-Life Balance: Showcase your commitment to work-life balance, as it is a top priority for legal professionals.
Adapt to New Qualification Pathways: Understand the implications of the SQE and adjust hiring strategies to account for potential skill shortages in specialized areas.
Conclusion
The legal sector's hiring landscape is dynamic and challenging, with rising salaries and evolving candidate priorities. By staying informed about salary trends, leveraging interim hiring, and aligning their EVP with the needs of legal professionals, employers can successfully attract and retain top talent. In this competitive market, adapting to change and understanding the evolving preferences of legal professionals is key to effective hiring. Stay ahead of the curve by making informed decisions and demonstrating your commitment to offering valuable and fulfilling career opportunities.