For the first time in years, law firms in 2008 saw a sharp falloff in revenue growth to single digits. They are likely to see more of the same in the months ahead.
Some are considering reducing capital spending and year-end bonuses to associates. But while firms around the country have begun trimming their lawyer ranks, few layoffs have been reported among Center City firms - though that could change if industry consultant Robert Denney's projections for 2009 bear out.
"For most firms, revenues are going to be flat," Denney said.
Bankruptcy, a staple for law firms during tough economic times, has so far failed to produce the gusher of fees many expected because failing businesses are increasingly resolving problems outside the courtroom in so-called prepackaged bankruptcies.
An uptick of business is expected, however, as businesses seek to offset falling revenue by suing over failed transactions.
Denney and other analysts said there was some evidence that small to mid-size firms had been more successful in weathering the economic storm because their lower rates had suddenly become more appealing to corporate legal departments that were under pressure to cut costs.