It has been well reported that the legal sector is facing a recruitment crisis. When 84% of the UK’s top 100 law firms are worried about a shortage of talent, the importance of retaining the skilled and expert staff within a firm becomes a priority.
In addition to this, recently updated evidence by Oxford Economics has found that the total cost of replacing one legal professional now stands at £39,887.
One of the major costs attributed to the total is the loss of productivity within the firm whilst the replacement worker amalgamates and familiarises themselves with the firm and the working ethos.
Even a well-established specialist can take between ten and twenty weeks to adjust to life in a new firm, whilst a graduate could take up to 50 weeks before they reach optimal productivity. This reduced productivity will impact a firm; in terms of a monetary impact, the firm will earn less whilst the new employee ingratiates themselves within the business.
The Cost of Brain Drain Understanding the financial impact of staff turnover, reported: “Across industry sectors new workers require fewer weeks to reach optimal productivity if they move into a vacancy from a previous role within the same industry. This makes sense of course, since they will already have a number of key skills that are important for their new role, and as such can more quickly move on to picking up the more advanced skills.
“Across sectors, our sample of firms reported that new workers from elsewhere in the same industry got up to speed within 10 to 20 weeks.
“By contrast, someone coming from a job in another sector took around twice as long to get up to speed – between 20 and 40 weeks.
“However, even these workers have a substantial advantage over new graduates, who on average take 30 to 50 weeks to reach optimal productivity depending on the sector they move into.
“Previously unemployed or inactive workers took the longest to reach optimal productivity – as much as 60 weeks in the case of legal firms.
“Our survey evidence strongly points towards smaller firms getting new recruits up to speed more quickly than larger ones – for recruits from elsewhere within the sector the smallest firms get workers up to optimal productivity on average in half the time as in larger firms.
“These differences persist across other sizes of firm – smaller firms get workers to optimal productivity ten weeks faster when they come from another sector, and twenty to thirty weeks faster for university graduates or unemployed and inactive workers.”
According to the 2018 Law Firms In Transition survey, 83% of law firms believe they have chronically underperforming lawyers. 83.4% of those lawyers were viewed as possessing weak business development skills and efforts; highlighting the importance of retaining the experienced and confident staff within a business.
New staff may be more concerned with blending into the firm which could impact on the work they are able to do and the ability to convert enquires into actual business.
58% of firms invest in business development resources to support staff, with 62% of firms creating individual timelines and plans for improvement; all of which have a significant time and monetary cost on the firm.
When firms looked to improve their profitability, 46.4% increased billing rates and targets more aggressively, whilst 53% looked at reducing staff; which would again perpetuate the problem of productivity when the firm looks to increase staff in the future.
Lynn Sedgwick, Managing Director of Clayton Legal, said: “It’s sometimes easy to overlook everything that a firm puts into replacing a skilled legal professional. Of course, there are the obvious things like job advertisements, but there are also plenty of other things that impact on the firm, even if they don’t immediately seem to have a monetary cost attached to them; disruption, lost opportunity and client loss, and also not ignoring the management time lost in the process.
“When one person leaves it creates a ripple effect across the firm. Colleagues find themselves under greater pressure, management is busy with arranging cover and HR have a job on their hands to find a replacement.”
“As any legal practitioner will tell you, law is a highly skilled profession. It takes time to settle into a new role and each firm is different. Simply appointing a candidate doesn’t mean the strain put on your workforce will suddenly disappear.
“The true cost of recruitment can be a shock. The best thing that firms can do is try to decrease turnover rates and reduce attrition amongst trainees and newly qualified staff. If firms can recruit carefully and then retain those staff, they put themselves in a much better position in the long term. It’s difficult when you’re dealing with client demands, winning new business and all of the other things that require attention. A recruitment partner that is able to handle the specialist demands of the legal sector can be a big help, not only in recruiting staff but retaining them also.”
Has your law firm been affected by decreased productivity whilst new staff train within the business? How important is it to retain staff?
