Legal services’ £60bn economic contribution must be heeded in Brexit talks
Brexit talks: Legal services contributed nearly £60bn total Gross Value Added (GVA) to the UK economy in 2018 while in 2017 legal services exports hit approximately £5bn – according to the latest available figures – the Law Society of England and Wales reveals today in an authoritative new report it commissioned from KPMG.
Law Society president Simon Davis said:
“This report shows the value of our sector to UK PLC – that is why we think it is vital our trade negotiators put legal and other professional services at the heart of forthcoming talks on a new deal with Europe.
“Legal services are not only incredibly valuable to our national economy but also to our global reputation. It is crucial the government seeks to maintain access to the EU27 for our legal professionals as well as recognition of their qualifications once the post-Brexit transition period finishes at the end of 2020.
“This will not only support the UK economy but it will help clients in the EU who currently benefit from being able to choose law firms from this jurisdiction.
“The report also highlights that the legal services sector is highly productive – with labour productivity up 17% from £84,000 per employee in 2013 to £100,500 in 2018 – almost double the national average. With the increasing influence of technology our productivity is likely to grow even more.”
For the first time the analysis of the value of legal services looks not only at the people employed directly in the sector but also in other jobs – such as in-house lawyers and general counsels employed in other business sectors.
It also shows the value of voluntary work conducted by legal professionals known as ‘pro bono’ which in 2017 saw an estimated 43,800 solicitors working 1,446,000 unbilled hours, worth an estimated £439m.
Simon Davis said:
“The scale of pro-bono work illustrates the social contribution of solicitors and other legal specialists – however no amount of free hours can ever plug the gap left by the under-funding of our legal aid system and I would reiterate our calls for the government to reverse those cuts.”
Key statistics at a glance:
- the report estimates that 1% productivity improvement in legal services in 2020 could boost UK GDP by between £990m and £1,200m by 2050
- in 2017, the UK exported approximately £5bn worth of legal services, and imported approximately £0.8bn – a positive net contribution of £4.29bn to UK balance of trade
- in 2017, legal services had the highest balance of trade among professional services sectors in the UK
- in 2018, legal services supported an estimated 552,000 full time employees – 358,000 directly in the legal services sector; 150,000 indirectly in the legal services supply chain; 43,000 more supported through the spending of direct and indirect employees’ wages within the UK economy
- the UK legal sector’s total GVA contribution is estimated to have been worth £59.93bn in 2018
- employment in the sector accounts for 1.1% of the total UK labour force
- level of employment in legal services is estimated to have fallen slightly in the years between 2013 and 2018 – by 0.7%
- over the same period, it estimated that productivity grew by 17% – in 2018 in legal services the average value of each employee’s contribution (measured in terms of GVA) is £100,500 compared to the national average of £54,330 in 2017
Kindly shared by The Law Society
