The soft, nagging feeling of a worldwide recession is starting to have some hard numbers attached.
There’s also this nugget from the FT that informs that the decline is probably even worse for lawyers:
The slump in M&A activity meant banks generated only $2.4bn in advisory revenue â€“ a 59 per cent drop from the first quarter of 2008.
To extrapolate legal fees from advisory work is a hazardous enterprise, as the banks usually work less and make more than the law firms. But this percentage fee decrease is a further sign that high-margin, high-utilization legal M&A work has largely dried up.
The decline in deal flow can actually be good in the near term for in-house counsel, since many departments have lost staff as well. It also gives more time to look after legal matters inside.
And perhaps consolidate outside legal work with lower cost, more flexible law firms.