Law firm lay offs have cut wide and deep. At a legal knowledge management lunch today, we were wondering how law firm EDD staff have fared. Hours later, I had an answer – and it surprised me. 

I’ve gotten to know David Cowen of the Cowen Group and the blogger at Opportunity Knocks over the last year. He is a search and recruiting expert for litigation support, practice support and Electronic Data Discovery and someone who thinks deeply about this market. His blog post today (reproduced with permission) E-Discovery dodges the bullet…:

Of the 2100 layoffs since January 2009, less than 3% (60) have impacted E-Discovery and Litigation Support professionals. See Layoff Tracker for specific details.

Here’s a quick overview of how we see E-Discovery staffing in the first quarter…

#1 – Most AmLaw 200 firms are holding off on permanent staffing. This will increase the demand for contract employees and outside vendors for their E-Discovery work.

#2 – Corporate E-Discovery headcount remains flat as they continue to wrestle with budget cuts, layoffs and in-house E-Discovery planning. This should be good news for vendors and outside counsel.

#3 – Vendors are proactively and in some cases aggressively looking for talented sales and client services professionals. Good news for talented individuals that find themselves with a shaky firm.

The use of contract and temporary workers is typical during recessionary periods. If permanent staff cuts go deeper then contract staffing and outsourcing will continue to increase.

While this is not great news if you’ve been laid off it does offer firms the opportunity to hire experienced talent that is highly motivated and affordable.

I am surprised that even 3% of the lay offs are EDD staff. I know that litigation is down and the cuts are deep but I think it’s harder to find good EDD staff than lawyers. Firms are either

  • short-sighted and will soon regret not having experienced EDD staff or
  • are converting fixed costs to variable (meaning outsourcing EDD) or
  • the litigation downturn is deeper and longer-lasting than many of us hope or expect.

Which is right?

[By the way, the Layoff Tracker David cites is a spectacular resource for those who want to follow the grim reaper.]