Research reveals Q3 revival for top 100 as nine-month fee slump ends

UK top 100 firms see growth overall but top 10 report 7.5% decrease on 08-09 income

The UK's top 100 law firms saw fee income increase in the three-month period finishing 31 January, ending a run of three consecutive quarters of declining revenues.

New research from professional services firm Deloitte found that law firms saw fee income grow by around 1.4%, compared with the third quarter of 2008-09.

Despite the positive news as a whole, Deloitte's research found that larger firms had not seen the same recovery. The top 10 UK firms reported a 7.5% decrease on the same period last year, with those ranked between 11 and 50 seeing revenues stay static. The growth came from those within the bottom half of the top 100, where fee income increased by 6%.

Deloitte's research also showed that reductions in headcount during the recession have led to an average rise of 5.9% in chargeable hours per fee earner and a 4.5% increase in fees per fee earner, compared with the same period last year.

Top 10 law firms saw the biggest increase in chargeable hours per fee earner at 10.9%. The rise is directly related to the reduction in headcount for each bracket, with top 10 firms reducing headcount by an average of 7.6%.

Jeremy Black, associate partner in Deloitte's professional practices group, told Legal Week: "The type of work that larger firms do is more reliant on private equity and M&A, which has suffered in the last year, compared with smaller firms that have more blanket coverage."

Bird & Bird chief executive David Kerr commented: "The results are a sign of a gradual increase in activity and that is our perception."

Allen & Overy managing partner Wim Dejonghe (pictured) said: "The market is patchy and activity depends on practice area, but most firms have been restructuring and have adjusted to the market over the past year."

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