“Are King County Attorneys in Distress?”, KC Bar Bulletin, by Stacey Romberg
Is your practice slowing down? Clients slow to pay? You are not alone. The current economic crisis has hit the legal profession.
According to the ABA Journal Weekly Newsletter, “The number of people working in legal services has dropped by nearly 12,000 in the last year, the U.S. Department of Labor reported [on December 5, 2008].” In November alone, job losses were reported at 2,200.1
My intake of new clients began to slow down this fall. But, in early November, I gained first-hand knowledge of the depth of the economic crisis. My office administrator gave notice. To find her replacement, I placed a Craig’s List ad, describing the position and listing the starting pay at $18 per hour. I received a flood of responses, more than 300, which only stopped after I pulled the listing.
And, even more surprising, numerous attorneys applied for the job. Some of these attorneys recently graduated from law school and simply wanted any job at any firm, doing anything. But others were experienced lawyers.
One attorney applicant previously worked as a contract attorney for a large Seattle downtown firm. This spring, her workload began to decrease significantly. Concerned, she inquired at the firm as to whether her work had been acceptable. She was told her work was good, but, “We can’t keep our new associates busy now, so we can’t give work to a contract attorney.”
In seeking information on how King County attorneys have been impacted by this economic crisis, I received widely varying responses. Some attorneys stated that their practices have not been affected at all by the economy, while others appeared to be in dire condition.
Although my informal surveying methods were less than scientific, two factors appear to influence the economy’s impact on an individual lawyer’s practice: years of experience and practice areas. Using my own practice as an example, I have now practiced law for 21 years, which can be a tremendous advantage in attracting clients in a tight market. However, two of my practice areas, estate planning and business, seem to be negatively impacted by the economy. In tough times, businesses struggle and clients may view estate planning as a discretionary expense.
To the contrary, other practice areas appear to be less impacted. “My practice is doing very well,” commented Mason Boswell of Boswell IP Law. “I focus on protecting software inventions, and I believe that the combination of a shortage of highly skilled attorneys in this area over the last few years and the long lead time required to get a patent are keeping this area growing. Although the immediate economic outlook is not good, a company’s patent strategy positions the company for growth over the next decade and cannot be neglected even in tough times.”
Another patent attorney, although noting that all the attorneys in his firm remain busy, lamented, “One of my clients required us to not increase our fees this year and, lacking any appreciable choice, we agreed to keep them at their already reasonable 2007 rates. Another large client has silently begun paying us one month later than usual. They’ve also put a stop to all new work to year’s end, as they’ve overrun their budget. In general, we’ve seen a marked decrease in new work.”
Along with several other attorneys interviewed for this article, I experienced a notable downturn in September and October, but am now enjoying an upswing. For example, I was told by one experienced estate-planning attorney, “I had a slow period for a couple of weeks in late September and early October. Since then, things have picked up considerably. I am not swamped with work, but I am comfortably busy.”
Similarly, a downtown Seattle business attorney in her fourth year of practice noted that, although she remained busy with work, client payments in September decreased dramatically. In October, she received no payments whatsoever from clients. In November, she received some payments, but not enough.
She is now changing her practice to adjust to the new economic conditions, including switching to a home office, and has postponed buying a needed new car. She stated, “This economy is really scary. It’s getting trickier to get money from clients.”
Other attorneys have experienced increased problems with client payment. Michele McNeill, managing member of Skyline Law Group, PLLC, stated, “As a real estate and construction litigator, I have not seen much of a reduction in work, but I have noticed that I am running into more people who lack the necessary funds to retain me.
“I require advance fee deposits to cover my work and, starting about six months ago, I noticed an increase in clients unable to pay the advance,” McNeill continued. “Financially, my practice is still thriving, but we are managing fewer cases this year than last as a result of the financial crisis.”
Ginger Boyle, a highly experienced Seattle family law attorney, notices the slowdown in her practice. “For the last few months, there haven’t been as many calls.” She believes her family law practice has slowed, in part, because families are experiencing enough financial insecurity without adding divorce into the mix.
Another family law attorney, Peggy Hoban, believes that economic conditions may substantively change family law. “I think mediations will increase, because it’s a more economically viable option for people. More people are willing to work things out and come up with win/win solutions rather than take a more adversarial approach.”
Boyle chooses to use the extra time in a positive manner, including engaging in three marketing activities per day, exercising more and scheduling fun events with friends. Another experienced Seattle business attorney, Stuart Heller, uses the extra time to pursue marketing activities and participate in a variety of community and pro bono-related endeavors.
Attorneys experiencing economic difficulties can seek help by contacting a business advisor, coach or the WSBA to identify and eliminate unnecessary business expenses, implement methods to promote a higher rate of client payment and take other steps as needed to maintain a financially healthy law practice. As stated by Peter D. Roberts, practice management advisor of the WSBA’s Law Office Management Assistance Program (LOMAP), “Nothing of much consequence gets accomplished in our society without reference to the law. In good times and not-so-good times, a lawyer may choose to divert her hard-earned skills in new directions when circumstances are showing the way. We in LOMAP are ready to assist our members with the practice guidance for the best chance of success.”
Stacey L. Romberg, Attorney at Law, focuses her practice on business law, estate planning and probate. She can be reached at www.staceyromberg.com.
1 ABA Journal Weekly Newsletter, “Legal Employment Down 12,000 Jobs in Last Year,” December 5, 2008, by Molly McDonough.
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Reprinted from January 2009, King County Bar Association Bulletin, by Stacey Romberg