Here are some statistics which may surprise you (apart from the first sentence):

Based on 2010 estimates, the UK had the largest share of the European legal services market followed closely by Germany. In total the UK and German legal services markets accounted for just under 50% of the total estimated revenues of the legal services sector in Europe.

There was an average of 1.80 lawyers per 1,000 head of population in 2008 in Europe (in 2008, in the United States, there was an estimated 3.82 lawyers per 1,000 head of population). Obviously, the proportion of lawyers per capita in the EU varies significantly from state to state.

The average revenue per lawyer at the EU level was estimated at €110,270 in 2010 (which is generally the same as the 2005 estimate). However, the average revenue per lawyer varies across different EU member states: for example, the UK and France estimates are considerably above the average, while the estimates for Italy and Spain are below the average reflecting, in part, the relatively higher number of lawyers per capita in the latter countries.

It is estimated that legal services revenues amounted to about 1.1% of GDP in 2010 in the five largest European markets. (The US equivalent was estimated at approximately 1.8% in 2007).

The estimated value of the legal services market in Europe, as measured by the total revenues received by law firms, was €113.6bn in 2010. Total revenues increased by an estimated 10% (or €10.4bn) over the five-year period from 2005-2010. By 2015, it has been estimated the size of the European market will reach €148.2bn, representing growth of over 25% on the 2010 estimates.

These findings come from an independent report commissioned by the Council of Bars and Law Societies of Europe (CCBE) from the Regulatory Policy Institute (authors: professor George Yarrow and Dr Christopher Decker) called Assessing the economic significance of the professional legal services sector in the European Union. It is unfair, even wrong, of me to begin with the statistics, because theirs is not a quantitative analysis.

In fact, they specifically say – and the above statistics should be viewed in this light – ‘Our general view of attempts to quantify the economic impacts of the legal services sector on economic performance is that, although they can provide one or two high-level insights and can be helpful in developing new statistics, there are significant limitations to this type of work, and the results of these quantification exercises should be approached with considerable caution.’

So what does the report say? It is 84 pages long, including a five-page executive summary, and says many things. But it has an important message for governments and regulators. It finds that the laws and institutions of a legal system condition and determine economic performance. Institutions that are stable and credible facilitate economic development and lead to higher levels of economic activity. Lawyers actively contribute, through their everyday actions and conduct, to both the shape of a legal system and how effectively it operates and functions. There is, therefore, an important relationship between legal services and economic performance, stemming from the important role that lawyers’ services play - beyond the legal services field - in facilitating and sustaining markets and market growth.

As a result, it is vital that legal services markets should function effectively. And here comes the message for the Legal Services Board and other market-driven regulators or governments: potential regulatory reforms (that could affect the quality or quantity of legal services) require careful assessment in conceptual and analytical frameworks that are broad enough to encompass the wider economic effects. It is this last sentence which should be kept in mind by a body like the LSB, which has been gung-ho in the past about market restructuring without always carrying out the necessary and appropriate economic impact research in advance.

I hope that the report will be widely read, and its message absorbed by those responsible for the future direction of the legal profession.

Jonathan Goldsmith is secretary general of the Council of Bars and Law Societies of Europe, which represents about one million European lawyers through its member bars and law societies. He blogs weekly for the Gazette on European affairs