The year 2009 opened with a barrage of bad economic news, including bankruptcies, foreclosures and layoffs. Law firms are starting to feel the pinch as clients suffer from the downturn. But will that pinch turn into a financial squeeze that delays some senior lawyers’ retirement plans?
“Senior lawyers close to retirement with investments tied up might have to postpone [retirement],” says to Robert Kerr, a sole practitioner in Calgary and local chair of the CBA-Alberta’s Senior Lawyers Section. “It could be the deciding factor in retirement. The economy is a big factor — if you don’t have sufficient funds, you stay longer.”
“I have to assume there is a likelihood some [older lawyers] are doing some cutting back in spending if retired — or, if they’re still working, they may be seeing a decrease in business,” adds Carl Jonsson, a partner with of Tupper Jonsson & Yeadoni in Vancouver and chair of the CBA-British Columbia’s Senior Lawyers Section.
“I have seen some clients struggling,” Jonsson says. “I act for public startup companies, and have seen plans for new companies cancelled due to lack of funding…. If the recession carries on and companies can’t raise money publicly, there will be a slowdown in my practice.”
The pain of the recession might be felt more acutely in formerly red-hot big urban locations. “In high-flying real estate markets such as Vancouver, lawyers doing work on these big projects will be hurt,” says Jonsson. “It might be easier for small-town lawyers to survive because of much lower overhead, whereas big firms are dependent on big projects and big deals. Projects are being cancelled.”
“Some bigger firms are cutting back,” Kerr agrees. “Real estate lawyers will suffer, as will mergers and acquisitions lawyers at big firms, but small firms, sole practitioners, lawyers in general practice will be okay.”
Kerr advises concerned senior lawyers to try to diversify their practice and cut down expenses, while Jonsson notes that two-thirds of the member so the Senior Lawyers Section is already retired; if they find themselves in financial trouble, cutting back is all they can do.
For those still drawing a paycheque, Kerr advises them “to hang in for the long run; don’t worry about the short-term. Business is still there, but you have to work longer to build your nest egg for retirement.”
—Michelle Mann