Lawyer Billing Rates Rising Faster than Inflation
According to this article in the San Jose Business Journal, lawyers’ average hourly billing rates have grown faster than the rate of inflation for the past several years. This should hardly be surprising given the growth in lawyer compensation over the past few years (especially the breathtaking profits-per-partner this year), because there are only 3 inputs to law firm revenues that bill by the hourly rate: # of hours worked x hourly rate x realization rate. Most firms do a good job on realization, so there’s only 2 levers to increase the top line: work harder or charge more. It appears that many lawyers are doing both.