The Law Society is calling for the UK government, regulators and local authorities to take action to support small firms and sole practitioners, warning that pressures on recruitment and burdensome regulation threaten their existence.
Research by YouGov commissioned by the Law Society, which included in-depth interviews with partners at 20 small firms across England and Wales, alongside economic analysis by the Centre for Economics and Business Research, revealed that the majority of firms (85%) cite recruitment and retention as their biggest challenge.
The research also highlighted rising costs and operational pressures, with professional indemnity insurance premiums, wage inflation and regulatory compliance squeezing margins.
Smaller risk falling behind as they lack the resources of larger firms that can invest in new technologies and artificial intelligence (AI), the research reveals.
Meanwhile, compliance requirements “place a disproportionate burden on smaller firms”, the research suggests, with tasks falling directly on fee earners.
To help smaller firms thrive, the Law Society is calling for full funding for Level 7 solicitor apprenticeships and a reduction in regulatory and business costs. It also wants greater support for digital transformation and AI adoption as well as pilots for community legal hubs will help protect local access to justice.
Mark Evans, who was Law Society president until earlier this week, said: “In rural communities and small towns across England and Wales, sole practitioners and small law firms are there to support people through major life events, from buying a home to setting up a business.
“Their sustainability isn’t just a legal sector issue, it’s a public interest matter. Sole practitioners and small firms are vital public services ensuring people across England and Wales can access justice.
“They make up the majority of legal aid firms and are there when people need legal advice in some of the most difficult moments of their lives.
“Supporting these firms isn’t just about economic growth. It’s also about levelling the playing field so the law works for us all.”
