Guest writer, Richard Hooper, Founder and Director of Balance Recruitment, gives us his insights into how the UK’s legal finance recruitment market has changed since 2022 and 2023.
Hiring trends within Legal Finance
Balance Recruitment, in partnership with the ILFM, run an annual salary survey and the findings are key to gathering data and insights. The survey goes out to more than 2000 legal finance professionals in the UK, so it’s quite comprehensive.
Couple that data with daily calls and research from law firms looking to recruit, together with job seekers, Balance Recruitment can provide a rich source of knowledge for this niche sector.
Legal Finance Recruitment 2021 & 2022
2021 and 2022 saw a candidate-driven hiring market, following a surge in demand for legal services, resulting in widespread expansion and headcount increase across fee-earning and business services teams.
We also saw heavy investment from US firms seeking to expand and gain market share within UK and Europe.
High demand was met with low supply of active job seekers, with many reluctant to make career moves following a period of instability and having seen improvements to work/life balance post Covid19 with the introduction of hybrid working.
These market conditions led to very competitive starting salaries for new hires, with annual pay increases also more prevalent and sizeable across the sector in comparison to prior years.
Legal Finance Recruitment 2023 & 2024
In line with most other industries/sectors, the legal finance recruitment market for 2023 and 2024 has flipped from previous years and we’re now in an employer-driven hiring market.
The changes are due to a softening in demand for legal services, together with rising interest rates and a poor economic outlook, which has led to a period of consolidation.
2023 in particular, saw a significant drop in legal finance job movement, with the majority of hires maintaining rather than increasing headcount. Meanwhile, the reported volume of active jobseekers has been rising for 10 consecutive months (as per the January ‘Report on Jobs’ produced by KPMG/REC).
Starting salary growth has softened as we’d expect within a less competitive hiring market and we anticipate pay reviews will be lower than in recent years.
Impact for Law Firms Hiring
As the tide has turned, law firms looking to hire will find:
- Lower competition – less likely to lose applicants to competitor firms
- Good market conditions to focus on identifying the best attainable talent
- Less urgency – time to allow for thorough searches to take place
- Increased application rates (role advertised on 4th January received 150+ applications in a week)
- Hiring directly becomes more time consuming and harder to shortlist
- Higher competition amongst recruitment suppliers, which can lead to:
- > Higher volume of CV’s received
- > More urgency/less rigour
- > Over reliance on active job seeker market
- Partnering with a dedicated specialist recruiter is advisable to negate these issues.
What are people looking for from an employer?
To attract the best attainable talent in the market, it’s important understand the key factors for consideration when individuals assess a potential career move. In our experience the following factors feature most prominently:
- Flexible hybrid working model
- Flexibility with hours to meet childcare needs
- Salary progression
- Fresh challenge/change of scenery
- Feeling valued (e.g. good benefits, regular appraisals, career progression)
Common mistakes in hiring for legal roles
Getting recruitment right isn’t easy, but we do tend to see some common mistakes which can lead to inefficient hiring processes and future retention issues. These include:
- Misplaced focus on urgency and ‘getting the role filled’ – allow more time at the search and selection stage for consistent results
- Focus should always be on identifying the best attainable talent at that time if committed to building great teams
- Ineffective use of recruitment suppliers (e.g. low commitment instructions placing multiple suppliers in competition against each other)
- Boring job adverts with no WIIFM (what’s in it for me)
- Line manager detachment from the process
- Over-reliance on the ‘look’ of CV’s (prone to bias)
Tips if looking for a career move in 2024
For those considering a career move this year, we’d urge to keep the following in mind:
- Figure out where your longer term career goal, which will help determine the best way to get there
- Establish your non-negotiables and stick to them
- Have patience – urgency brings compromise
- Fully explore what opportunities exist for progression internally before looking elsewhere
- Do your due diligence. Are you able to find out more about a prospective employer?
- Lean on your network or connect and talk with people who can share a perspective.
Summing up the Legal Finance Job Market
Regardless of the market conditions, getting recruitment right isn’t easy and mistakes can be very costly. Challenge the impulse for urgency. More time and rigour at the start of a process which will inevitably yield more reliable and higher quality results (often faster).
Dig deeper to understand what you can offer to your target audience and how to communicate your value proposition.
Working with recruiters in a low-commitment transactional relationship will not produce optimal results – work in partnership with a recruiter who can consult on how best to achieve a successful outcome.
About Richard Hooper
Richard has 20 years’ experience of recruiting within the legal finance niche, and set up Balance Recruitment in 2008. He has a wealth of knowledge in hiring across all disciplines and levels of seniority. Richard is trained in executive search and works in close partnership with a wide range of law firms advising on hiring best practice. He is experienced in career coaching and helping legal finance professionals in their pursuit of career fulfilment.