2023 Bright Insight: The 2023 National Legal Sector Benchmark Survey Results

Technology has had a growing presence in how law firms operate, how they compete, and how they think about their office real estate. Even prior to the pandemic, increased technology costs were a top five real estate design decision for law firms 13 and this priority has only grown in importance. Since 2020, there has been an emphasis on communication and IT security technology that has allowed attorneys to work remotely at a much higher degree than in the past. Prior to that, law firms

were implementing practice management software, document management systems and electronic discovery technology. Artificial intelligence is the latest in this ongoing trend. Firms indicate they spent an average of 5.3% of 2022 gross annual revenue on technology. The expectation is for this to grow to 6.8% next year.

Investment in technology is a commonality amongst firms of all sizes with varying degrees of investment as a percentage of gross annual revenue across groups. Firms listed on either the Global 100 or Am Law 200 were more likely to invest a higher percentage of their revenue in technology than firms that aren’t present on those lists. Interestingly, firms lower on the Am Law 200 list in 2022 were more likely to invest a higher percentage of their revenue than firms that ranked higher on the list. Am Law 50 firms saw technology spend average 5.5% of gross annual revenue in 2022; firms ranked 51-100 were slightly more aggressive in their technology investment at 5.9%. However, the Am Law 200 firm average was 6.0%, meaning firms ranked 101-200 invested a higher percentage of revenue than Am Law 100 firms. Firms lower on the Am Law 200 list in 2022 were more likely to invest a higher percentage of their revenue than firms that ranked higher on the list.

Technology Spend as a Percentage of Gross Annual Revenue (2022 vs. 2024)

2022 Technology Spend as % of Revenue

2024 Technology Spend as % of Revenue

10%

8.0%

7.7%

8%

7.3%

6.8%

6.6%

6.0%

5.9%

5.5%

6%

5.3%

5.3%

5.2%

4.2%

4%

2%

0%

All Firms

Global 100 Am Law 1 - 50

Am Law 51 - 100

Am Law 200 None of the above

Source: Cushman & Wakefield Research

13 Cushman & Wakefield 2019 Legal Sector Bright Insight report

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