Although no one can predict exactly when the next recession will come, history has taught us that it would be judicious to have people in place before it hits. The need for restructuring the legal industry is as dynamic as it has been over the last 25 years. Last month, there was the biggest drop in the stock market of the year due to an inverted yield curve (when long-term debt instruments produce a lower return than short-term debt instruments).
In 2018 economic experts were saying that the next recession will catch us in 2020. They also predicted that it will be worse compared to the 2008 economic crisis. If their prediction is correct, it means that the upcoming recession can be compared with the 1929-1939 economic crisis, known as the Great Depression.
Here are a few ideas about how law firms can prepare for the upcoming recession in order to minimize the negative impacts.
- Whether you are a small or big law firm, you should be prepared and ready to adjust by making changes in investments, resource allocation, etc, if you want to survive the upcoming recession.
- Start a recession-friendly practice area. During the upcoming recession, certain attorneys will be more useful and on-demand, such as bankruptcy and debt settlement specialists.
- Law firms should reevaluate their marketing budget and find out whether it’s worth the money you have invested in it. The attorneys should start to re-evaluated their tasks to select those tasks that are worth the attorney’s time.
- Bring technology into legal practice. By increasing attorneys’ access to innovative tools and legal tech products that promote the automation of legal industry, law firms will save plenty of time and money. One of the main revolutionaries in this regard is AppearMe, the largest litigation support provider in the US.
- Save some cash and have a credit line. These prevention initiatives will ensure your law firm will have the required cash to pay bills when your income drops during the recession. Moreover, you should have an emergency fund for at least a year.
Plan ahead and your law firm will exit from the upcoming recession stronger than when it entered it.
