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United States / Analyst Insights
Top US Industries with Rising Demand for Legal Services

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by Nick Masters, Lead Industry Analyst
Aug 15 2019

The current state of the US economy has been highly beneficial for providers of legal services, who are working to fill substantial demand from the Information (IBISWorld report 51) and Finance and Insurance (IBISWorld report 52) sectors. Rising capital markets and low interest rates are driving a surge in IPO and merger and acquisition (M&A) activity, while the tech sector’s unchecked growth has caught the attention of antitrust authorities, resulting in a flood of legal implications. In turn, demand for securities, litigation and antitrust attorneys operating within the Corporate Law Firms industry (IBISWorld report OD4805) is increasing, with no signs of stopping. 

Protecting tech

The societal and commercial reach of large tech companies is attracting the attention of regulatory agencies and US Congress. In response, tech companies are enlisting outside legal counsel to defend their businesses. Industries that are defined by their leading players, such as the Search Engines industry (Google), E-commerce industry (Amazon) and Social Networking Sites industry (Facebook), are facing antitrust scrutiny for the outsized influence these companies have on industry dynamics. Since these industries primarily offer free services, they’ve been able to fly under the radar of federal antitrust examination until now. However, as dominant digital platforms have expanded and acquired competitors, such as Facebook’s purchase of Instagram, industry competition has waned, and the Department of Justice has called into question the extent to which digital platforms are beholden to consumer demands.

As antitrust scrutiny continues, industry-leading tech companies are fortifying their legal defenses beyond in-house counsel. Antitrust probes are often thorough and exacting; to help deal with the breadth and depth of such cases, Silicon Valley is increasingly on the market for extra legal muscle.

Facilitating financial deals

2019 is set to be the year of the IPO, with capital markets reaching all-time highs and high-profile, private tech companies like Airbnb hinting at public offerings. M&A activity is also on an upswing across several industries, including Brand Name Pharmaceutical Manufacturing (IBISWorld report 32541a). [For the latest, check out “Rising M&A Activity Shakes Up Pharmaceutical Industries” on IBISWorld’s Industry Insider].

Due to the extensive regulatory hurdles and compliance measures associated with IPOs and M&As, legal services are essential to the Investment Banking and Securities Dealing industry (IBISWorld report 52311) for navigating the legal landscape of such transactions, especially for large-scale deals. High capital market values and low interest rates are incentivizing IPOs and M&A transactions; in 2018, the number of IPOs rose 19.0% to 190, according to IPO adviser Renaissance Capital.

Corporate attorneys play a significant role in the closing of such transactions given the extensive legal requirements associated. Upon filing for an IPO, companies must register with the Securities and Exchange Commission (SEC) and ensure compliance with the Securities Acts of 1933 and 1934. With regard to M&As, corporate attorneys are enlisted to conduct due diligence and mediate the transaction, while also ensuring regulatory and antitrust compliance.

Heightened deal activity has also been a boon to corporate legal offices specializing in transaction-related law. According to legal recruitment agency Mestel & Company, corporate and securities law ranked the highest for recruitment activity in 2018.

Overall, demand for legal services is expected to remain strong given a robust pipeline of pending IPOs and favorable economic conditions supporting additional M&A activity.




Looking for coverage on additional sectors with heightened demand for legal services?  Check out our previous Analyst Insight here!




Edited by Kieran Newton
Infographic Design by Shira Bartov