You can’t get away from the news: the legal market is beginning to slow quite dramatically. Especially hard hit have been paralegals and attorneys working in the securities, finance and real estate sectors. Not to mention what’s happening out here in Los Angeles with the continuing Writers Guild strike. Companies and law firms have begun layoffs of attorneys and paralegals and despite the roar of the government, there are no signs that the situation will improve anytime soon.
One paralegal recently wrote us that they will be attending our New York Paralegal SuperConference on Feb. 11-12th because "things here are so slow, there’s not much else to do." Great. Just what we want to hear.
For those of you who are senior paralegals, you’re probably reluctantly recalling what occurred in 2000- 2001. There was an economic boom ("the Internet bubble") that created a great deal of legal work and then came the crash causing much of the work (and jobs) to simply vanish.
Most recently, we had a real estate boom which created a great deal of legal work and has now gone away. This has affected the financial and real estate sectors the most; however, a lack of liquidity in the markets will likely have broad implications for most law firms. The availability of investment capital fuels spending in intellectual property, mergers & acquisitions, entertainment financing and more.
It is axiomatic that companies tend to spend more on outside services such as law firms when times are good than when the economy is in trouble. Even litigation caseload goes down (while bankruptcy work goes up).
According to BCG Attorney Search, what occurred in 2000-2001 in particular with corporate work, was quite shocking: Tens of thousands of corporate attorneys and paralegals lost their jobs. A significant percentage got out of the law completely after not being able to find work.
Corporate work came to a virtual standstill at most firms, particularly in San Francisco and Silicon Valley. What made this so absurd was that most firms did not call these layoffs and instead told many attorneys and paralegals they were being let go for performance reasons. We’ve just begun to hear similiar stories from paralegals in cities such as Washington, D.C.
In a survey conducted by Estrin LegalEd in the Fall of 2007 of corporate law department paralegals, over 80% of the paralegals surveyed said that the current real estate crisis would not affect their employment. If that survey were conducted today, it is most probable that over 80% would be would be quite concerned and scouring the want ads.
As an aside, if your work is good and you and others in your organization are being told there is a problem with your performance—look out. This is often a sure sign that the firm or company is experiencing serious economic problems. Firms typically do not lay people off—they let them go under the guise of performance-related problems. No firm wants to signal economic problems to their competitor. I suppose it’s ok to signal they have a few quirks in their recruiting techniques.
Now is the Time to Aggressively Investigate What is Going on in the Market
Paralegals who come out on top when the market shifts dramatically are those who go “all out” in their search for information—they leave no stone unturned. They get cross-trained in several areas. Are you a corporate paralegal? Get cross-trained in litigation. Create better research skills. As trite as the saying goes, there is now real meaning in what we’ve heard for years: Make yourself more valuable to your firm – now.
Some paralegals believe they are too special or been at the firm for too many years to get laid-off. They believe because they may know where all the skeletons are buried, they are immune to getting let go. They are under some crazy impression that employers should give them plenty of advanced warning or let them in on the fact that serious downsizing might be coming down the pike. In reality, it just doesn’t happen that way. You are often broadsided, no matter what kind of caring, loving exit interview the firm may provide. And, the more senior you are, the harder it is to find a job in hard times.
The object is to stay employed and weather a possible recession. If you are not aware of what is going on in your firm and what alternatives you may have, believe me, your competition will. They will score the available jobs and you will be left out in the cold. Chances are, as a paralegal, you have no real idea what financial shape your law firm is in. Paralegals in public companies have more of an advantage as stock prices are posted daily but law firm employees are often taken by surprise.
If you are not currently actively seeking a position, now is the time to be aware of what is available in the market so you can be prepared if conditions at your current employer change. Stay educated. Take seminars and learn new skills. Stay on top of job opportunities. If you are currently seeking a position, it is important that you be as thorough as you possibly can in your search. You need to give yourself as many options as possible, just in case. Do not be a victim of the economy. Do the right thing: Take charge of your career and life.