TheCityUK’s UK Legal Services 2016 report, shows continued financial growth for UK-based legal services firms, with gross fees up 1.3% to a record £30.9bn in 2014/15 – the fifth successive year of growth against a backdrop of significant structural reform.
The sector’s trade surplus has nearly doubled over the past decade to £3.4bn in 2015, while the sector’s contribution to the UK economy increased to a record £25.7bn in 2015 (1.6% of GDP).
According to TheCityUK estimates, the UK accounts for around 10% of the global market for legal services, second only to the US. It is also the largest market in Europe, accounting for around a fifth of its legal services fee revenue.
The annual report highlights the significant restructuring across the sector over recent years, with newer entrants to the market – including the major accountancy firms, innovative smaller law practices, contract and on-demand lawyers and due diligence specialists – increasingly competing for traditional law firms’ business. In 2014/15, mid-tier and niche firms continued their robust performance for the third year running, with firms ranking 25-50 by revenue seeing a 6% increase, and those in the top 25 seeing a slight decline.
The UK is the world’s most international market for legal services and the virtually unrestricted access it offers foreign firms has seen over 200 foreign law firms from around 40 jurisdictions establish offices here, as well as the main base of operations of two of the four largest international law firms, based on headcount. The UK is also the leading international centre for dispute resolution.