Sole practitioners have dismissed research findings which appear to suggest that their wing of the profession is in decline. Last week chartered accountancy firm Hazlewoods released statistics which apparently showed the number of sole practitioner firms had fallen by 22% in the past five years.
The figures took published data from the Solicitors Regulation Authority website for October 2016 and compared it with the same time in 2011. Over that period, numbers fell from 3,400 to 2,600 and now account for 26% of the authorised firms, compared with 31% five years ago.
Hazelwoods director Andy Harris said the regulatory burden was becoming too great for practitioners and said life as a sole practitioner was not as sustainable as in the past.
Harris, who suggested more solicitors are opting to work for ‘virtual’ firms in larger organisations, added: ‘The reality is that the smaller the firm, the bigger the compliance burden as a percentage of billable time. Sole practitioners just don’t have sufficient economies of scale.’
But representatives of sole practitioners hit back, saying the research was selective and misleading, and insisting the sector remains an attractive option.
The Sole Practitioners Group said the SRA data did not provide a breakdown between sole practitioners who are incorporated and those who are not. Over the five year period, according to SRA data, the number of incorporated law firms has actually gone up from 2,583 (24% of the total) to 4,225 (41%) – a rise of 63%.
SPG chair Kemi Mosaku reported that the organisation has had an increase lawyers wanting to set up their own sole practices, and work with the SRA has successfully minimised the red tape involved.
She added: ‘For a lawyer who is an entrepreneur setting up in sole practice has never been easier and is more attractive than switching from employment in a law firm to being a consultant in a so called virtual law firm where they cannot build their own brand and are not in charge of their own destiny.’
Tony Roe (pictured), a member of the Law Society’s Family Section and Small Firms’ Division committee, said Hazlewoods’ figures were ‘entirely out of context’.
‘I am not sure how useful it is to be presented with this sort of press release, particularly one which does not set out all its sources or data upon which it might rely,’ said Roe. ‘Many SPs are converting to limited companies or setting up as them in the first place – often on the advice of accountants.’