Market Roundup: Spring 2020

The sudden impact of COVID-19 has divided the year into two halfs: pre-COVID and post-COVID. Pre-COVID, many firms were reporting a strong end to the financial year and figures released to this effect won’t yet show the impact of lockdown. But post-COVID, the market is having to adapt quickly to an ever changing landscape.

Most firms have been swift to act – even if the impact has not been felt yet - with many utilising furloughing in respect of staff members, reductions in pay and bonuses and partner drawings, offering sabbaticals and unpaid leave and even withholding distributions as many firms have taken the view to preserve cash resources in anticipation of a bounce back later in the year when office working resumes. The immediate impact of enforced remote working is the rise in reliance on technology, the anticipated long term change to flexible working as well as the question over whether costly City office space will be worth it in the long run.

Yet the law is an ever-agile profession and the changing fortunes of firms will be dependent on their client base, sector and practice area focus and most importantly, appetite for risk combined with their cash and debt position. Already we are finding a real diversity in firms looking to the future post-lockdown and those frozen in the headlights. As with previous downturns, there will always be firms that can adapt and emerge stronger, and decisions taken now will set firms on their pathways for many years to come.