Law firms in England and Wales experienced rapid, sector-wide growth in 2025, with average earnings up by 11.2% compared with a 6.1% increase in 2024. The figures, released yesterday in the Law Society’s new annual Financial Benchmarking Survey, reveal the highest rate of growth for the sector in more than 15 years.
Year-on-year fee growth was reported by 85% of the 121 firms who took part in the survey, with 55% seeing growth of 10% or more.The number of fee earners increased by 2.3%, which the Law Society says reflects a sustained demand for legal services.
Total fee income across participating firms exceeded £1.2 billion, equating to an average of £9.9m per practice.
Total median salary costs fell slightly as a proportion of fee income to 63.9%, with non‑salary overheads falling as a share of income to 28.4%, down from 31.0% in 2024.
Although the time taken to collect payments remains high, at just over four months after being appointed, the figure fell to 134 days from 146 days in 2024.
The survey also revealed a 2.3% increase in the number of legal professionals across participating firms – although recruitment and retention pressures, rising employment costs and increase national insurance contributions made up almost a third of the concerns cited by those surveyed.
Regulatory issues were also a top concern, with existing and potential SRA regulatory requirements amounting to 18% of the worries shared. Ongoing scrutiny of client money, high-volume claims work and governance standards were all singled out.
The data-driven benchmarking survey offers “an annual health check”, the Law Society said, allowing small and mid-sized firms to measure their performance against the wider sector.
Mark Evans, president of the Law Society of England and Wales, added: “Despite ongoing external uncertainty and an increased need to invest in new technology, law firms are seeing strong growth. The legal sector remains healthy and resilient.
“Solicitors continue to support clients, businesses and communities while heavily contributing to the UK’s economy. With the right support and investment, England and Wales can continue to lead the world as a renowned legal centre.”
