When the economy is strong and on a strong growth trajectory, companies bring critical functions in-house—as opposed to outsourcing—to enhance profitability.
A classic move for firms to bring the recruiting function internal, rationalizing that headhunters are pricier than a captive staff recruiter with immediate access to databases such as LinkedIn or industry-specific job boards like SelectLeaders, where companies can target the best and the brightest in real estate.
Well, the “insourcing” trend is now crunching law firms, as their own clients staff up with internal lawyers who handle much of the day-to-day legal requirements, leaving lawyers begging for the highly profitable bread-and-butter legal work. According to a survey by BTI Consulting Group, 58% of larger companies are bringing legal functions in-house, up from 50% in 2013.
A related trend is for companies to bring on contract lawyers for special projects, beating the heavy-duty hourly charges of law firms. But stay turned, because when the economy heads south, as it will for sure, the CFO's corporate planners will recommend cutting headcount, and move to outsource functions such as recruiting and legal functions.
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