Growth across Britain’s legal services slowed sharply last year, but the latest snapshot from a City lobby group continues to portray a sector in vigorous health, according to the Law Society Gazette of England and Wales.

TheCityUK’s 12th annual report finds that revenues generated by the legal-services sector rose to Stg £43.7 billion in 2022 – up 5.6% on the £41 billion reported in 2021 (when the growth rate was 12.5%).

Revenues have climbed by 60% since 2012.

Employment drops

The sector contributed £34 billion to the British economy in 2022, up from £30.7 billion in 2021.

It now employs 368,000 people – down from 375,000 in 2021. Two-thirds of those working in legal services continue to be based outside London.

According to the report, the top 100 firms generated £33.7 billion of the £43.7 billion reported for 2022/23. The revenues of the top 25 rose by 7.7% to £26.4 billion.

The report also shows that all of the top 50 global firms have an office in London.

‘National asset’

Miles Celic (chief executive officer, TheCityUK) described Britain’s legal-services sector as “a vital national asset”, but warned that its success could not be taken for granted.

“To maintain its global pre-eminence in legal services, the UK’s reputation for the rule of law must be protected and enhanced. To foster job creation and drive economic growth across the country, the UK must support innovation in legal services, particularly within the exciting and fast-growing lawtech sector,” he said.

The report shows that Britain is home to 43% of European lawtech start-ups.