From USA’s uncertain legal market to rising inflation, we bring you a collation of key updates for January 2023.
US legal market report 2023: mixed results and growing uncertainty
A new research report by Thomson Reuters Institute shows that the US legal market might face uncertainty as we enter 2023.
The annual 2023 Report on the State of the Legal Market outlined a dip in one significant metric, profits-per-equity-partner (PPEP), which is down for the first time in the past fourteen years. Another factor that showed an opposite trend was legal demand, which contracted by 0.1% on a year-to-date basis in November 2022, contrasting to a 3.7% increase for 2021.
One interesting fact to note was the relative strength of midsized firms that stood relatively more robust and saw growth in 2022. The report attributes clients’ willingness to shift to qualitative work and cost-effective outside counsel.
Australia’s energy sector to undergo a momentous legal change
The Australian energy sector is foreseeing huge changes in 2023 as renewable energy and environmental, social and governance (ESG) issues are becoming significant in boardroom discussions.
The government aims to cut greenhouse gas emissions by 43 per cent below 2005 levels by 2030 and looks forward to sourcing 82 per cent of the country’s energy supply from renewable sources.
Four energy lawyers discuss the new challenges in 2023 governing the rapid-fire legal changes. They stress how lawyers across various practice areas now must be well-versed with energy laws.
Inflation has hit 7.8% over the past year
The inflation rate is at its peak, touching the 7.8% mark – the highest in the past two decades. Although inflation is at its highest since 1990, people are optimistic that the worst is behind them.
In the December quarter, the average price on discretionary items (excluding tobacco) rose 2.7%, compared with 1.3% for non-discretionary items. A silver lining beams with prices of the quarterly goods now dipped 2.9 per cent in December 2021 quarter to 1.6% in the last three months of 2022.
Real wages that were slowly growing until 2020 are now slowed down, with the index of real wages in December 2022 touching the 100 mark, almost equal to 2009 levels. The index had touched its peak during pre-pandemic in 2020, close to 108.
The US economy is growing strongly, but economists expect a recession
The US economy saw a strong front on the GDP (Gross Domestic Product) with an increase at 2.9% annualised rate. However, economists foresee a recession later this year.
While the economists polled by Reuters had forecast GDP rising at a 2.6% rate, the economy grew at a 3.2% pace in the third quarter. Consumer spending was a significant growth driver resulting in a surge in goods spending at the start of the quarter. Despite the GDP growth, economists suggest a mild recession could hit the market in the second half of the year.
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