Insource Founder, Jenn Little

New legal recruitment system reflects talent shortage

Article by Geoff Adlam, Capital Letter, Friday 4 November 2022

A volatile legal recruitment market and major shortage of lawyers with the most sought-after skills are causing a big change to the way the recruitment industry functions, says Insource founder Jenn Little.

Launched to law firms in April 2021, the Insource recruitment technology platform is now used by 18 of New Zealand’s 20 largest law firms. A move into Australia in February has already brought 12 of the top 50 firms on board.

“On both sides of the Tasman we’ve got a growing number of different-sized law firms in the CBDs and regions on subscription plus a number of high-end specialist firms,” Little says.

She describes Insource as recruitment technology which gives law firms and in-house legal teams control of their recruitment and the associated costs.

“Insource significantly reduces the time and cost to recruit. The platform contains the complete pool of lawyers that hold a New Zealand or Australian practising certificate as well as all registered New Zealand legal executives. Law firms and in-house legal teams can use Insource to quickly generate a list of all lawyers or legal executives that match their selected criteria for a live role or future role and build a relationship directly with their future talent well in advance of needing to hire.”

Little says the real talent shortage in the legal market is challenging the traditional reactive recruitment approach where jobs are advertised and applicants apply.

“The only way to move beyond the shortage is to start to talk to the future talent before there is an actual vacancy. Building a talent pipeline is going to be really critical to how firms and in-house legal teams will fill their future live roles and achieve their future growth plans. Proactively building relationships with people interested in working for your firm or inhouse legal team at a future date is the key to changing the current talent sourcing challenges legal employers are facing right now.”   

Upending the recruitment market

Little says with a major shortage of talented lawyers with sought-after skills available on demand, it is time for a legal recruitment market reset.

“In all my years in recruitment the firms never liked paying high recruitment placement fees to recruiters. With the growing lawyer shortage across all markets and lawyers being more and more difficult to source and retain, law firms must start conversations with their future talent well in advance of needing to hire. A major advantage of Insource is that it uniquely enables firms to build a live talent pipeline. 

“If HR teams and hiring partners are prepared to be more proactive about their recruitment and develop a talent pipeline, they’ll be able to fill their future live vacancies more quickly from their talent pipeline as opposed to having to compete for the small pool of available talent. Currently firms are having to pay higher than normal starting salaries often well beyond what is reasonable for the experience level to secure talent. A little time spent regularly connecting with future talent prospects and remaining in touch as agreed will go a long way to ensuring firms and in-house teams have a talent pipeline at the ready. Firms with a talent pipeline will be able to front foot their future recruitment needs. 

“At the moment the largest talent gap in most firms is the four to six year PQE level. Most firms are very stretched at this level – people at this stage of their career tend to move inhouse or be raising their families or they are overseas. In New Zealand law firms are typically more senior heavy.”

Development of a technology company

Little has worked in the legal sector for more than 20 years, initially in a regional firm and national firms AJ Park and Russell McVeagh before moving into legal recruitment in 2008. 

After five years working for others in recruitment, she set up her own search and recruitment business which focused on headhunting and placing lawyers into many of New Zealand and Australia’s top tier, mid-tier and boutique firms. Accurate and up-to-date information on individual lawyers was essential to her success. 

“To deliver great service for the firms who had retained me, I knew for each search assignment, I needed to map a complete part of the market and know that I had identified every candidate that had that relevant experience or was at that PQE or in that particular location. I invested in building a database for myself to have this information and create complete market maps for each role.”     

Meeting the market and law firm needs led to a decision in mid 2019 to pivot from being a services based headhunting business to one built on technology. 

“So it came to building a searchable technology platform for law firms and in-house legal teams to subscribe to and carry out their own searches and recruitment. With Insource firms can better inform themselves about the talent market, its movement and composition, which will result in better talent sourcing activity and future workforce hiring decisions,” Little says.

Searchable database

Rebranding in mid-2020 turned the recruitment company JLR Ltd into Insource. At its heart Insource is a large and constantly updated searchable platform of every practising lawyer in New Zealand and Australia and all registered New Zealand legal executives. To develop and maintain it, Insource has a team of 21 researchers who are constantly researching, developing and maintaining the mass of information publicly available to ensure the information is up to date and can be relied on.

“All the information is available publicly and is assembled from a great many sources to include firm profiles, Legal 500 and other ranking systems, lawyer publications, LinkedIn profiles, and the public registers of lawyers.”

Little says the objective of Insource is to provide HR teams and hiring partners with the complete picture of the available pool of talent and remove the lengthy research and list generation process to enable hiring managers and HR teams to connect with the talent right away. 

“They don’t need to spend hours to do the research and develop a list, then confirm whether the lawyer has a current practising certificate and search to see if they have a LinkedIn or firm profile. Insource does this work for them. Their precious time is better spent building relationships with these people.” 

Little points out that research isn’t just a matter of checking out a LinkedIn or firm profile.

“There are around 4000 New Zealand lawyers who don’t have a LinkedIn profile and over 8000 don’t have a firm profile. If you’re relying on those sources, you’re missing a big part of the market and a lot of those lawyers are typically at 0 to 10 years PQE.”

Charging model

Little says the Insource charging model aims to make the technology accessible to firms of all sizes on a monthly tiered subscription.

“At the bottom end it starts at about $500 per month and at the top end it’s $2500 depending on lawyer headcount. And so even at the top end it’s only the equivalent of the recruitment agency fee for one senior placement, but with Insource you can make unlimited placements.”

While Little and her team no longer directly engage in recruitment, they are obviously keen observers of the market and clients are also able to access regular blogs and insights on talent movement and emerging trends, together with the benefit of her team’s collective HR and talent acquisition experience and her headhunting methodology. Full training and support is available to all subscribers on both sides of the Tasman. 

Although the Insource platform is not available to recruitment agencies, Insource has access to a network of experienced independent freelance legal recruiters who are available as needed to assist law firms and in-house teams that don’t have their own internal talent person or that require additional resource.   

“Should they choose, the subscribing firm or in-house legal team can assign a freelance legal recruiter in Insource to a particular live role or pipeline so they can assist with any part of or the whole recruitment process,” Little says.

Once assigned, the freelance recruiter can access the role or pipeline they have been assigned to on the subscribing firm or in-house legal team’s Insource dashboard. Freelance recruiters charge an hourly rate that does not exceed $120. Firms and in-house legal teams only pay for the freelance recruiter’s time – there are no placement fees. 

Little says a major benefit of Insource is that all of the information generated in it remains with the hiring firm or company. 

“So often leads and intelligence are stored within the HR person or talent acquisition manager’s individual LinkedIn account and that is lost when they leave, or it ends up in a recruiter’s database.”

Lawyers not flocking home

Looking at the current state of the legal market, Little says the talent shortage is set to continue.

“Even if a technical recession does occur, firms need to be ready to hire when the market returns to strength rather than be on the back foot and scrambling for talent like they did in the years following the GFC or more recently in the initial months of lockdown.” 

She points to comments by Baker McKenzie Australian Managing Partner Anthony Foley at International: “Finding staff, more than any looming economic slowdown, will continue to be the firm’s major challenge over the coming year. We would expect at this stage to enjoy similar levels of business in the coming year as we did in the last.”

Insource data shows that in the second quarter of 2022, 35 per cent of lawyers leaving the top seven New Zealand firms headed overseas, while only 2.5 per cent of the hires in those firms were returning from overseas. In that quarter in Australia, 16 per cent of lawyers leaving a top six firm went overseas and just 2 per cent of hires were returnees from overseas.

“It shows us that lawyers are not flocking home. They continued to leave our shores right through Covid-19. More interestingly, I think, Lawyers Weekly recently reported that in September the Australian lawyer salaries were very comparable to UK lawyer salaries – so New Zealand lawyers don’t have too far to go from home to obtain international work in global partnerships offering global salaries.”

Little is excited about the changes that Insource is bringing to legal recruitment in New Zealand and Australia.

“The feedback from subscribers is positive. We are not experiencing churn and the general consensus is that Insource is now a critical part of our subscribers’ recruitment strategy.”

Original article published here: New legal recruitment system reflects talent shortage | Capital Letter

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