Growth in fraud, cybercrimes and other economic crimes is expected to drive the legal services market in the forecast period. Due to the increasing prevalence of fraud, law firms globally will face increased demand for legal services.
The global legal services market size is expected to grow from $713.12 billion in 2021 to $788.94 billion in 2022 at a compound annual growth rate (CAGR) of 10.6 percent. The growth in the legal services market is mainly due to the companies rearranging their operations and recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges. The market for legal services is expected to reach $1112.75 billion in 2026 at a CAGR of 9 percent.
Legal services industry trends
The emergence of the alternative legal service providers market is a key trend in the legal industry. ALSPs are non-traditional, niche companies that specialize in providing high-demand legal services such as document review, contract management, litigation support, electronic discovery, contract lawyers and staffing, legal research, and IP management. They are essentially focused on the âbusiness of lawâ, leveraging a combination of legal, business and technology capabilities, to provide services to both corporates and law firms. Businesses are increasingly employing ALSPs for many routine legal services, and law firms are outsourcing non-revenue generating tasks, such as project management, business analysis, billing, and expenses to ALSPs.
Legal services market segments
The legal services market is segmented by type of service into B2B legal services, B2C legal services, hybrid legal services and criminal law practices. The B2B legal services was the largest segment of the legal services market segmented by type of service, accounting for 54.8 percent of the total in 2021. Going forward, the hybrid legal services segment is expected to be the fastest growing segment in the legal services market segmented by type of service, at a CAGR of 9 percent during 2021-2026.
The legal services market is also segmented by size of law firm into large law firms and SME law firms, by mode into online and offline, by type of practice into litigation, corporate, labor/employment, real estate, patent litigation, tax, bankruptcy and others (regulatory, M&A, antitrust, environmental), and by end-user into individuals, financial services, mining and oil & gas, manufacturing, construction, IT services, other services and others.
Regional analysis
North America was the largest region in the legal services market, accounting for 55 percent of the total in 2021. It was followed by Western Europe, and then the other regions. Going forward, the fastest-growing regions in the legal services market will be South America and the Middle East, where growth will be at CAGRs of 11.1 percent and 10.6 percent respectively. These will be followed by Africa and Eastern Europe.
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