As the baby boomer generation ages, only about a third of law firms are formally planning for succession, a recent survey found.
Roughly, 320 law firms, of all sizes, participated in the survey conducted by the legal consulting firm Altman Weil.
It suggested a retirement crisis may be looming on the horizon, and painted a picture of the legal industry as poised for seismic shifts: A majority of the responding law firms said that partners aged 60 or older control at least a quarter of the firm’s total revenue.
It is not clear who or what will replace them when they leave. About 60 percent of participating law firms said that they expect first-year associate classes to continue shrinking.
Holland & Hart chair Liz Sharrer said that her Denver-based firm, which has about 500 lawyers, has no mandatory retirement age. Partners older than 60 control more than 23 percent of the firm’s billings, Sharrer said.
The report suggested that a perception existed among participating firms that some work performed by entry-level lawyers could be handled by cognitive computing systems, such as IBM’s Watson. Only 20 percent of those surveyed insisted computers could never replace human practitioners, while in 2011, about 46 percent of respondents said “no way” to computers replacing human lawyers.
Paul Masinter, chairman of the litigation committee of 58-lawyer Stone Pigman Walther Wittmann in New Orleans, said younger lawyers may be more amenable to using artificial intelligence for document review but he isn’t as comfortable.
Both Masinter of Stone Pigman as well as Sharrer of Holland & Hart, said they have turned to the lateral market for junior lawyers, recruiting mid-level to senior associates from competitors as the market for first-years shrinks.