Law firms in New Zealand are now beginning to feel the pinch as legal skills shortages emerge in a rising commercial property market.
The current drought of commercial property, corporate commercial and banking & finance lawyers stems from decreased activity in commercial property after the Global Financial Crisis (GFC), Mark Simpson, partner at Convergence Partners, told Stuff.co.nz
After the GFC, building work slowed down tremendously, meaning that legal graduates were far more likely to go into other areas such as litigation.
“Fewer young lawyers started in property/banking/corporate teams in the large and mid-sized firms in the height of the GFC. There are far fewer at that mid-level to go around now that work levels have really started to increase, particularly in commercial property in Auckland,” he said.
Since commercial law firms tend to be cyclical, they do really well in a stable economy but are the first to feel the effects if transactions stop and conditions worsen, he added.
The current shortage involves lawyers within the $70,000 to $110,000 salary range. This means Kiwi lawyers working overseas are often too senior for the role when they return home.
“Not only are their salary expectations beyond what the role is offering, but also they expect a higher level of work, more similar to what the firms’ existing senior associates and partners are doing,” Simpson said.
To counteract this, firms will need to get more creative in their recruitment efforts, he said.
“You’ll see firms having to widen the net – looking at people from smaller firms, more junior or more senior people, lawyers from offshore jurisdictions and being forced to be open to part-time/flexible hours.”
Robert Berry, a property lawyer and partner at Hesketh Henry, told Stuff.co.nz
that good property lawyers were indeed hard to find.
“The two-to-four year lawyers who are good operators either go overseas or they’re entrenched where they are so they’re in short supply everywhere, but I do think with commercial property there is a shortfall,” he said.