Good times for costs firms?
The majority of industry news concerning the costs profession comes from the pages of Costs Lawyer magazine and the Association of Costs Lawyers’ regular email bulletins.
Reading these gives the impression of a profession in glowing good health with announcements of firms opening new offices and regularly taking on new staff and recruiting key personnel.
It is understandable that costs firms wish to promote their good news stories.
It is therefore something of a change to see the Law Society Gazette announce a prominent costs firm with apparent cash-flow issues and the fact they have recently closed two of their four offices and reduced their headcount from 110 to 70.
This is hardly unique and the last year or two has seen a number of firms close offices, costs teams being disbanded and redundancies made. There has also been an increasing number of mergers and takeovers. One suspects a large number of these mergers/takeovers have been driven by the need to survive as opposed to being positive attempts to expand.
It is not clear to what extent this is hitting the pockets of individual costs lawyers or law costs draftsmen, although it will clearly be impacting on many who own their own costs firm. Given much of the reduction in workloads will have been from increases in low-value claims attracting fixed fees, one would expect these changes to have been initially felt by those less skilled costs workers who were probably the first to be let go. On the other hand, one reader recently suggested to me that the number of advertisements appearing in Costs Lawyer magazine for experienced costs lawyers (with corresponding salaries) has been declining and those jobs still being advertised are for more junior staff.
I wonder whether any of those who confidently predicted Jackson was nothing to worry about and suggested it would bring wonderful new opportunities are now starting to re-evaluate matters.