The value of UK legal services exports has reached an unprecedented high, according to recent research by financial lobby group TheCityUK.
Gross exports of UK legal services surged to an impressive £9.5 billion in 2023, reflecting the sector’s increasing contribution to the national economy. The overall revenue from the UK-based legal services rose by 7.7% year-on-year, hitting £47.1 billion, cementing the UK’s position as the second largest legal market globally, following the United States.
The global legal services market, currently valued at $765 billion in 2022, is expected to expand significantly, reaching $950 billion by 2027. Law firms continue to lead in export contributions, with barristers and other legal professionals like patent agents bringing in £116 million and £118 million, respectively.
When accounting for imports mainly attributed to UK businesses billed by overseas law firms, net exports were calculated at £7.6 billion, marking a substantial 14% annual rise. Over the last decade, net UK legal services exports have soared by more than 80%.
TheCityUK report states that over 368,000 individuals are employed within the legal services sector across the UK, with London hosting 133,000 of these professionals, followed by Manchester with 13,000, Birmingham at 12,000, Leeds housing 9,000 professionals, and Edinburgh and Glasgow each employing approximately 7,000.
Furthermore, the UK legal landscape is increasingly international. Over 7,000 foreign lawyers practice in England and Wales, while more than 200 international law firms have established offices in the region. This international appeal extends to the courtroom, where a significant number of cases involve international parties, including 75% in the Patents Court, 64% in the Commercial Court, and 54% in the Competition List.
The role of barristers in international legal advocacy continues to grow, with the number of barristers in England and Wales representing foreign clients doubling over the past decade. Approximately 2,500 barristers have secured instructions from abroad, generating over £506 million in revenues in 2023. Additionally, more than 6,500 solicitors from England and Wales, alongside 800 from Scotland, operate internationally.
In alternative dispute resolution, the UK completed over 28,600 civil disputes in 2023 through arbitration, mediation, and adjudication. Highlighting the UK’s prominence in legal innovation and technology (lawtech), the report notes that the UK is home to 44% of European lawtech startups, with 356 companies amassing £5.5 billion in investment during 2023. Belfast, in particular, is emerging as a hub for legal innovation.
Challenges persist in the sector, notably regarding gender representation in senior roles and lawtech entrepreneurship. Female founders lead only 14% of lawtech ventures, and teams of female founders secured a mere 2p for every £1 of equity investment in 2021. Lord Chancellor and Justice Secretary Shabana Mahmood emphasises the critical role of legal services in facilitating broader trade and investment, affirming the government’s commitment to strengthening the UK’s legal influence worldwide.
The UK legal services sector continues to demonstrate robust growth and international influence, supported by its substantial economic contributions and innovative edge. However, addressing challenges such as gender disparity remains crucial to sustaining its forward momentum.
