Growth Weak But Income Up Slightly
- 2010 revenues up only 0.5%. This compares to a 1.4% increase in 2009. 69% of all firms posted revenue increases in 2010 and 31% saw decreases.
- Income per partner for 2010 is projected to increase 1.8%.
- For 2011, firms are projecting an improved but still modest 3.7% revenue increase and a 4.4% increase in income per partner.
- 31% of firms laid off staff in 2010 compared to 60% in 2009.
- 74% of firms say the number AND the quality of available experienced staff is good: 26% disagree.
- 67% of firms hired staff from the increased labor pool. Firms are taking advantage of the best labor market in 15 years to upgrade their staff.
- 83% of firms plan to do more marketing in 2011 than 2010.
- The vast majority of firms say the recession has not impacted their merger pursuits.
Common recession strategies:
- Focus on providing excellent service to existing clients; keep current clients happy.
- Take advantage of technology to do more with fewer people.
- Little or no pay raises; layoffs and furloughs. But danger lurks: 60% of firm’s staff are considering leaving, eager to make up for their flattened compensation.
- Greater efforts to hold partners accountable for their performance. With the increased effort to avoid reductions in total partner income, there is more scrutiny over partner performance.
- Focus on improving the efficiency of internal workflow processes.
- Control costs; cut overheads.
- Ask for more charge hours from staff (finally!) now that work-life balance has taken a back seat to “I’m glad I have a job.”
- Watch collections and past due A/R more closely.
- Increase the focus on strategic planning and goal setting.
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