Key Insights: Actionstep’s 2025 Australian Midsize Law Firm Priorities Report
Midsize law firms in Australia are at a pivotal juncture, striving to balance competing priorities. With pressures from larger firms with expansive resources and nimble boutique competitors, midsize firms face unique challenges and opportunities as they prepare for 2025.
Our 2025 Australian Midsize Law Firm Priorities Report dives into these dynamics, uncovering the strategies, challenges, and trends shaping the future of law firms. Here’s a peek into what we discovered, and why downloading the full report is a must for firms looking to stay ahead.
What are Australian firms prioritising?
Unsurprisingly, client satisfaction emerged as the top priority for midsize firms, with 71% of respondents marking it as critical, which is up from 50% last year. However, firms also ranked talent acquisition and retention (59%), managing the cost of doing business (57%), and digital transformation (55%) as significant focuses for driving and protecting revenue.
Yet, with these ambitions come challenges. While most firms feel confident in achieving client satisfaction (only 11% marked it as a challenge), recruiting and retaining talent remains the hardest hurdle, with 45% struggling to meet this priority.
Key takeaway: While firms recognise that happy clients drive revenue, solving internal workforce challenges is just as crucial.
A digital disconnect exists
Nearly 60% of firms admit to weaknesses in their digital tools and client experiences, despite client satisfaction being their top priority. While efficiency is seen as the best way to grow revenue from existing clients (30% of respondents chose it), 74% of professionals cite heavy workloads as a barrier to delivering exceptional client service.
Additionally, 52% of respondents wish their firms would implement automation tools to lighten the load, highlighting a disconnect between the intention to improve client experiences and the investment in technology to achieve it.
Key takeaway: Firms rely heavily on their people to deliver efficiency, but without embracing automation, they risk overworking staff, leading to burnout and diminishing client service quality.
When it comes to tech adoption in law firms, hesitation means opportunity
When it comes to new technology like AI and automation, firms show mixed confidence:
- 81% feel prepared to manage cybersecurity threats.
- 75% feel confident about meeting AML obligations.
- But only 5% have fully implemented AI tools in an integrated way.
Interestingly, 38% of firms are already using automation tools, which often serve as a steppingstone to more advanced technologies like AI. While concerns about data privacy remain (66% are hesitant about AI for this reason), automation offers a clear path for firms to start modernising.
Key takeaway: Firms need to bridge the gap between awareness of technology’s potential and actual implementation.
There is a challenge with talent retention
With 59% of firms prioritising talent acquisition and retention, it’s no surprise this remains a top challenge. While only 13% of legal professionals plan to leave their firm in the next 12 months, younger generations like Gen Z are more likely to consider leaving, with 23% expressing this intention.
The report highlights that pay and remuneration remain the biggest factors influencing retention (62%), but professionals also value engaging work, strong leadership, culture, and work-life balance.
Key takeaway: Investments in technology and efficiency can reduce costs, creating room for firms to improve compensation and workplace culture (the key drivers of retention).
What’s next for Australian midsize firms?
The 2025 Australian Midsize Law Firm Priorities Report reveals an industry in flux, balancing traditional approaches with the need for innovation. From adopting technology to retaining talent, midsize firms have significant opportunities to drive growth and better serve clients.
Want to dive deeper into these findings? The full 2025 Australian Midsize Law Firm Priorities Report includes:
- Detailed strategies firms are using to retain top talent and foster workplace satisfaction.
- Insights into how firms are using (and hesitating to use) new technologies like AI and automation.
- A closer look at how firms are enhancing client relationships to stand out in a crowded market.
