It’s the moment you’ve all been waiting for….our traditional “Happy New Year” blog!
As you know, I usually run through expectations for the year ahead in terms of the market and salaries, particularly in relation to real estate law, as its my primary focus.
I am bound to say after the last 12 months, I think making predictions is a little tricky!
We are very conscious it has been such a tough time for so many. As a business we therefore decided to make the Manchester Central Foodbank our chosen charity for Christmas 2022. Its set against this difficult backdrop, thinking of those less fortunate than ourselves that we look to the year ahead….
Given the broad uncertainty and so many unknowns, I thought I would look at what we do know and focus on five “truisms” for the year ahead that I think will help to define the legal jobs market. While I make no apologies for being pretty focused on real estate, I think these 5 facts are pretty applicable across the board for legal jobs:
1. This is not 2008! Pleasingly, every real estate partner I have come into contact with in recent months has said the same thing. As of yet, while there has certainly been a downturn post mini budget, this is so far nothing like what we faced during the credit crunch, which led into the Great Recession, which defined so much of the landscape throughout the 2010’s. The banks are well capitalised and are still lending – albeit at increased interest rates!
2. Interest rates are not predicted to go as high as was earlier thought, which will provide welcome relief to borrowers across the broader property market. Debt will be more expensive but those with strong cash positions will still be in a position to do deals and move projects forward.
3. Inflation will fall across this calendar year with falling energy and commodity prices and supply chains being repaired. Hopefully this helps reduce the severity of any downturn and give businesses the confidence to invest and grow, particularly from the second half of 2023.
4. We still have a chronic shortage of qualified lawyers with early to mid level years experience in all key legal disciplines including real estate. This will mean that any softening of economic conditions will not translate into stalling salaries. We still expect NQ salaries to rise this year, albeit we will believe this increase will be more measured than the previous 12 months.
5. The battle for top talent will be as intense as ever. The shortage of lawyers and the worsening economic climate will mean that the available candidate pool will be even smaller in 2023 as candidates eschew the jobs market in the face of uncertainty. This means that those seeking to grow and invest will have to focus heavily on offering high quality candidate experiences that present a clear vision and rationale for growth and offering candidates an exciting glimpse into a different future.
To reiterate, the five observations above are based only on what we know going into 2023. We also know, there are likely to be events that arise which once again alter our thinking and force us to once again adapt to a new paradigm. As ever, the law firms and candidates that continue to adapt and press forward will be the ones that continue to thrive in these uncertain times.
If you’d like to have a chat about what 2023 means for you or your business I’d be delighted to speak!
joegregory@thinklegalrecruitment.com
