State of the Paralegal Market: What's Big in Legal Tech and What Does the Future Look Like?
Anyone familiar with the legal industry knows that it has long been resistant to change. However, in recent years, innovators in the legal space have been pushing for law firms to adopt technology and take advantage of its many benefits. The COVID-19 pandemic only accelerated that adoption out of necessity.
Recently, Georgetown Law and the Thomson Reuters Institute released the 2021 Report on the State of the Legal Market, which describes the legal industry’s evolution in response to the pandemic and shines a light on current trends that are impacting the future of this industry.
Keep reading to learn more about the major industry shifts and legal tech innovations taking place today—and the efficiencies your firm can bring onboard to stay ahead of the competition during these unprecedented times.
Trends in the Legal Industry
Here are some of the top trends that law firms across the country are seeing today:
Firms are employing fewer lawyers due to the pandemic.
According to the report, the average law firm saw a 1.7 percent reduction in headcount toward the end of 2020. In other words, law firms are employing fewer lawyers in response to the pandemic. In response, paralegals need to do more with less and use their time more efficiently. This is an area where legal tech can be particularly beneficial.
COVID-19 forced firms to embrace legal tech.
Speaking of legal tech: While legal activities were almost exclusively conducted in person, the pandemic led to the rise of virtual hearings and virtual meetings. Law firms had no choice but to adopt technology in order to lessen human-to-human conduct and keep employees, clients, and court staff safe. As a result, business travel and in-person meetings decreased significantly, which made smart law firms more receptive to legal tech.
Firms are increasingly scrutinizing their finances.
In the aftermath of the pandemic, law firms were forced to reassess their approach to budgeting and expensing and embrace “sound financial practices,” the report says. Luckily, by trimming the fat from operations and keeping immaculate track of time, billings, and collections, firms can improve their financial well-being and become more profitable. This was a lesson many firms were happy to learn.
New business models are coming into existence.
Seeking to get a little more creative as the industry shifted, law firms are increasingly eyeing new business models to drive more revenue. According to the report, firms have been more interested in partnerships and collaborations. At the same time, they are working more intimately with clients and implementing new legal tech to meet clients’ increasingly modern expectations around transparent legal experiences.
As the industry evolves, more and more law firms are turning to legal tech solutions to increase their effectiveness and competitiveness. With that in mind, let’s turn our attention to some of the top benefits of investing in legal technology tools.
Legal Tech Overview: Benefits of Using Technology for Law Firms
By 2025, the legal tech industry is expected to haul in around $25 billion. This is due to the number of benefits legal technology can provide to firms of all sizes, which we’ll examine further in this section.
1. Save time.
In an age where paralegals and other legal staff need to do more with less, legal technology can save the day. For example, instead of searching for process servers manually each time legal documents need to be served in different states, paralegals can use Proof for process serving management. With Proof, you get access to a network of more than 1,400 vetted process servers in all 50 states. This solution lets paralegals like you largely automate the entire serving process and receive live updates from start to finish. Proof’s platform allows you to reclaim time you can then invest into other endeavors.
2. Save money.
On top of saving you time, legal tech can also save you money. To continue the above example, since you can use solutions such as Proof to instantly connect to a vetted server anywhere across the country, you don’t have to worry about wasting time, money, and energy on someone who may not get the job done in a timely manner. You’ll get the most bang for your buck with Proof—and your firm’s bottom line will be healthier because of it.
3. Maximize productivity and efficiency.
Facing an ever-increasing volume of work, paralegals certainly have their work cut out for them. When firms decide to fully embrace legal tech and heavily invest in digital transformation, great things happen. In addition to using a service such as Proof to automate the process of serving legal documents nationwide, there are a number of other solutions on the market designed to streamline other mission-critical responsibilities within your firm. With the right tool kit in place, paralegals can accomplish more, maximizing productivity across the entire firm.
4. Drive competitive advantage.
As we all know, the legal industry has historically been rather resistant to change. While the pandemic has changed this significantly, not every firm is an early or easy adopter of new technology. That being the case, embracing legal tech and digital transformation enables your organization to rise above slow-moving competing firms that are hesitant to embrace the future. Taking a proactive and open-minded stance on legal tech can make it easier to win new business.
5. Make work more enjoyable.
If your law firm is focused on hiring the best talent on the market, you should invest in modern tools to eliminate tedious, time-consuming tasks so their skill sets can be best utilized resolving critical matters for the firm. It’s that simple.
It’s been more than a decade since venture capitalist Marc Andreessen wrote about software eating the world. People are building software to improve every aspect of life, and your employees know that. Failure to invest in modern tools makes it impossible to attract and retain top talent because they’re incapable of reaching their full potential otherwise.
Luckily, by investing in legal tech solutions designed to simplify workflows, work becomes more enjoyable, and retention increases—a boon to your business and your clients.
What’s the Future of Legal Tech?
As legal tech takes center stage, the future looks brighter than ever for law firms. Here are some of the legal technology trends that firms need to be aware of.
Firms are investing more money in legal tech.
As a recent Gartner report highlights, firms are pumping more and more money into legal tech. In fact, the research consultancy predicts that investments in tech will increase threefold by 2025. In other words, if your firm isn’t thinking about pouring money into technology, you’ll almost certainly be left behind as your competitors undoubtedly will be.
Paralegals are more important than ever.
According to that same Gartner report, legal departments are poised to replace 20 percent of their generalist lawyer staff with nonlawyer professionals in the coming years. That being the case, paralegals are poised to play an even more important role at law firms in the future. The sooner organizations empower paralegals with legal tech so they can do their best work, the easier they’ll be able to lock down the best talent.
Proof: Legal Tech Designed for Firms Like Yours!
If you’re looking to accelerate your law firm’s digital transformation with legal tech, Proof can help. Contact us today to learn more about Proof’s user-friendly platform to efficiently serve legal documents nationwide every time.
