According to the data on Insource, firms will really benefit from looking at new sources of legal talent like in-house. The date reveals that the number of new hires made by the top 6 Australian firms [1] in quarter two is down by 10% from last quarter.[2] The “war for talent” continues as firms battle a backlog of live roles with the need to proactively pipeline lawyers for future roles.[3] The main sources of talent hired by the top 6 Australian firms were another Australian private practice law firm (76%), including top tier, mid-tier and boutique firms while just 16% came from in-house / government. In an increasingly competitive market, where firms are all scrambling to hire the same candidates, is there an untapped market of in-house lawyers ready and willing to join private practice?
Perhaps now is the right time for those responsible for hiring lawyers to really investigate new sources of legal talent, in their hiring processes.
Where, oh where, are the overseas returners?
Only 2% of the top 6 Australian firm hires in quarter two were overseas returners. Despite travel being largely back to “normal”, Aussie’s are not flocking home, they’re leaving. 16% of the total lawyers leaving a top 6 Australian firm in quarter two, left to go overseas. This is not surprising, given the probable build-up of Aussie lawyers unable to move overseas during the pandemic, but the trade deficit isn’t doing our (already candidate-short) market any favours. To minimise the impact of this deficit, firms should be having open conversations with their lawyers about future travel plans early. Discussing (and supporting) an overseas experience creates and maintains a positive relationship with current employees and alumni.
Trend of private practice lawyers moving in-house continues
Of the lawyers that left a top 6 Australian firm, 43% left to go in-house or to a government organisation in quarter two. This has always been common move for private practice lawyers, but why? Does an in-house role truly offer a better work-life balance? Given the rise in technology, increased focus on “working from anywhere” since the pandemic, and the often-urgent nature of legal work – this may no longer ring true. Both private practice and in-house lawyers can have clients who need to contact them around the clock. Depending on the size of an in-house legal team, lawyers may have fewer resources (i.e. admin support or precedents) while having an equally demanding workload. Firm’s need to consider their employee value proposition and how they can manage this trend moving forwards.
New sources of legal talent, the advantages of hiring in-house lawyers
Lawyers joining the top 6 firms from an in-house, or government organisation made up just 16% of top 6 Australian firms hires in quarter two. In New Zealand this was much higher, at 28%. Perhaps the kiwis are onto something? With underwhelming numbers of overseas returners and the high number of firms often all competing for the same candidates, could there be an unrealised market of in-house lawyers? Hiring a lawyer without private practice experience may require an initial investment in training, but the return can be significant. If the organisation is a key client of the firm (and the hiring process is managed well) this can strengthen the relationship. The firm subsequently has a competitive advantage when it comes time to tender and/or renew the contract terms. In addition, in-house lawyers have a different perspective and can provide valuable insight into the running of companies and what’s important to their stakeholders having worked on the other side.
How Insource can help you unlock new sources of legal talent
Insource Recruitment Technology provides instant visibility of lawyer movement and the ability to quickly identify any trends, like in-house moves or alumni overseas. Populated with all lawyers that hold an Australian practising certificate, Insource gives law firms and in-house legal teams control of recruitment and better informs your future talent sourcing strategies. Insource is used by leading top 50 Australian law firms, as well as innovative mid-sized and specialist law firms across all states. An Insource subscription ranges from $500 – $2,500 per month depending on the size of your legal team. We’d love to hear from you and discuss how an investment in Insource could deliver better hiring decisions both now and in the future. To find out how to unlock new sources of legal talent, book a demo and contact us here.
[1] Allens, Ashurst, Herbert Smith Freehills, King & Wood Mallesons, Minter Ellison and Clayton Utz.
[2] The statistics contained in this Insight are based on the publicly available information as at the time of writing.
[3] Anecdotally, Insource is aware of several law firms that cannot prioritise their future pipelining due to the work load of their vacant roles.
