Happy CLOs Are Poised to Hire More in 2010

4Mar/10Off

Happy CLOs Are Poised to Hire More in 2010

According to the results of the Association of Corporate Counsel's 10th Annual Chief Legal Officer Survey, CLOs are not only happy with their job, but want to share that happiness by hiring more in-house counsels in 2010. More than 90 percent of CLOs that responded to the Survey indicated that they were happy with their jobs (up 2% from last year’s Survey). Even with the recession and a heavier workload, chief legal officers said they still like their jobs. It’s still good to be in-house. And, it looks like that happiness is going to spread.

How Much Will CLO Increase Hiring By?

About one-third (29 percent) of the 970 chief legal officers who responded to the survey said they're planning to add to their departments this year, up from 23 percent last year.

While these are positive news in an otherwise still gloomy market, this does not mean that the in-house legal market has turned the corner.

In-house legal are still operating under tough budget constraints, and while a 5% increase over last year is good news, it will not serve to make much of a dent in this saturated market

Who Will They Be Hiring?

In particular, over one-fourth (28%) of respondents plan to hire lawyers to do commoditized work, and 21% of these respondents plan to hire specialists.

In addition to the increase in hiring plans, the survey found that the number of law department attorneys based outside the U.S grew this year. This increase can be seen in Western Europe and Canada, where the number of in-house attorneys rose from 1% in 2008 to 7% in 2009; and also in Asia/Pacific, where there was an increase from 1% in 2008 to 2% in 2009.

Why Are CLOs Looking to Hire More?

The recession has forced companies to take a critical view of how they operate. While CLOs will be increasing in-house hiring, they will also be decreasing spending on outside counsel. More than a third (34 percent) said they've cut spending on outside counsel. At the end of the day, they have figured out that they can operate more efficiently by bringing more work in-house, spending less on outside counsel, and boosting spending on alternative fee arrangements, the survey shows.

Could This Be a Long-Term Trend?

That remains to be seen. While this is not a significant increase in hiring, this may be a sign of more positive news to come. Moreover, the recession has forced companies to try on a new model, and they may like what they see.