As we step into the second half of FY2025, Australia’s legal market is showing impressive signs of sustained growth and resilience.
FY2024 closed on a high note, with profit growth reaching its fastest pace since at least FY2015 — a standout year by any standard. While few expected a repeat performance, early results from FY2025 suggest that Australian law firms have maintained momentum, reporting solid activity across most practice areas.
Last year, firms benefited from broad-based demand growth, increased worked rates, and stronger utilisation — all while successfully absorbing significant headcount growth. Encouragingly, many of these gains have either held steady or continued to build as we move through FY2025.
Which Practice Areas Are Leading the Charge?
📈 Areas Showing Strong Growth:
- Banking & Finance up 10.5%
- Workplace Relations up 6.9%
- Construction up 4.3%
- Disputes up 3%
In sync with this data, we’ve seen a surge in recruitment activity within Banking & Finance. Firms are moving quickly to secure top talent, often offering above-market salaries and sign-on bonuses to attract the right lawyers. Demand for specialists in leveraged finance, acquisition finance, and project finance is particularly high.
📉 Areas Seeing Contraction:
- M&A down 3%
- Insolvency down 1%
- Real Estate down 0.3%
While these areas have seen modest declines, the broader market remains in a healthy position. Gains across high-performing practice groups are more than offsetting contractions, helping firms sustain profitability and confidence. With Australia’s GDP growth now stabilising, the second half of the fiscal year will be one to watch — especially as firms look to leverage ongoing demand and favourable economic conditions.
Thanks to Thomson Reuters for the insights.
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