Nearly half (48%) of London law firms are already using artificial intelligence and a further 41% have imminent plans to do so, according to a CBRE survey of more than 100 law firms.
Some 61% of the CBRE Legal 100 have also adopted an agile working policy – a doubling over 12 months. The law firms included in the survey occupy a total of almost 10m sq ft, spending £495m per annum on rent, up 6.2% from 2013 and representing an average of £49.41 per sq ft, compared with £43.51 per sq ft five years earlier.
Of the firms already employing AI, 63% are using it for legal document generation and review, and the same proportion for e-discovery. Due diligence (47%) and research (42%) were also common applications, along with compliance and administrative legal support (32% each).
CBRE research found the use of AI will affect employment levels, with the greatest impact predicted at the junior and support levels, where nearly half (45%) of firms believing that there will be a reduction in headcount. In contrast, only 7% of firms believe that senior headcount levels will be reduced.
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Frances Warner Lacey, senior director, central London tenant advisory group, CBRE said: “Our study found considerable uncertainty around the impacts of AI on employment, reflected by over 30% who were unsure of the potential impact at each level.
“This will make formulating a dynamic real estate strategy, to cope with these structural changes to the sector, particularly problematic for law firms.”
CBRE also found clear signs that the traditional partner’s office culture is declining among law firms, with 33% now in more open or activity based working environments. This figure is likely to increase, particularly amongst UK law firms, CBRE said.
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Warner Lacey said: “We expect the proportion of firms engaging in activity-based agile working environments to increase in the coming years. Compared with some other professional services businesses, such as consulting firms, the legal sector has been slow to adapt to agile working, but this is changing.
“Of the firms surveyed, 61% have now implemented agile working policies – a doubling since last year’s report.”
In spite of speculation about businesses moving away from London following the EU Referendum, the study indicated that the vast majority (98%) of law firms expect no impact on profitability as a result of the referendum.
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