Cost cutting has recently risen up the agenda at many law firms, for obvious reasons. If transactional work slows then staffing levels may need to be reviewed. Efforts to keep fee earners happy may also dwindle as the job market slows, and opportunities to jump ship are limited. However, taking rash staffing decisions or becoming complacent in talent retention during a downturn is the wrong path to follow, and could cause damage in the longer term.
Remuneration will always be a key element when trying to attract and retain talented lawyers. In an unstable economic environment, salary increases and bonus payments may get squeezed and cannot be relied on to keep staff satisfied. In addition, the forthcoming round of promotions may bring disappointment as fewer opportunities occur. Aspiring stars may have to wait another year or more until there is greater confidence and certainty in the market.
