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The recession has put tremendous pressure on law

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Unformatted text preview: industry of publicly traded companies. The recession has put tremendous pressure on law firms. An article in the Economist magazine (May 5, 2011) states that “ever-growing profits are no longer guaranteed. Nor, for some firms, is survival.” Work on mergers and acquisitions has dried up. Clients are scrutinizing bills and challenging the convention of paying by the hour. Firms are adapting by charging flat, capped, or contingent fees. All of this puts pressure on profits. According to an annual survey by the National Law Journal, the 250 biggest firms pink-slipped more than 9,500 lawyers in 2009 and 2010. They also deferred hiring. This left new graduates in a glutted market. Indeed, many law school graduates do not even go into the legal profession. A new niche, “legal-process outsourcing firms,” which do not advise clients but do routine work such as review documents, puts further downward pressure on the demand for traditional law firms. These outsourcing firms can be located anywhere in the world. The PBS Comm...
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This note was uploaded on 02/11/2013 for the course MGMT 231 taught by Professor Yu during the Spring '13 term at Bauder.

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