The COVID-19 crisis has led to steep decline in new legal matters in the last two months
New data has shown just how much the slowdown in economies due to the COVID-19 pandemic has hit the business of law.
Research conducted by cloud-based legal technology firm Clio found that new legal matters opened each week has decreased by more than 30% compared to the start of the year. The data Clio compiled showed that opening of new matters decreased as the number of COVID-19 cases around the world increased.
The drop was even steeper when taking into account a brief increase in new matters generated at the end of February. When that is referenced, the number of new weekly matters dropped a total of 40%, Clio said.
The steepest drop in new matters created weekly was experienced in the week of 16 March. That period was also the week when the worst one-day drop in the history of the Dow Jones happened, followed by major declines in the index in the following days.
The data came from Clio’s app data, aggregated from tens of thousands of legal professionals, the company said.
Clio also found from surveys of 485 legal professionals in the US that 77% of law firms agree that their day-to-day operations have been significantly impacted by the coronavirus pandemic. Just 16% disagreed that the impact on their legal business has been significant.
“Respondents expressed widespread concern over the future success of their businesses and their ability to make ends meet. Much of this concern is likely due to the fact that the majority of firms have seen a drastic decrease in the number of people reaching out for legal services. This immediate decrease in the demand for legal services, however, appears to be in spite of a steady—if not increased—need for legal help,” Clio said.
In its survey of 1,042 consumers in the US, Clio found consumers are delaying legal issues amid the global health crisis, with 49% agreeing they would put off a legal issue, compared to just 20% who would still proceed.
It appears that a majority of consumers expect legal issues to be unrelated to the coronavirus, as just 13% expected a legal issue related to the pandemic.