Wolters Kluwer Legal & Regulatory’s ELM Solutions business has published its latest LegalVIEW Insights report, Volume 2025-2, which indicates that the legal market is heading towards a significant transformation by 2026, driven by fluctuating legal rates, the value of firm reputation, and the accelerating influence of artificial intelligence.
The report highlights that these factors are set to redefine the established dynamics within the legal sector. Jennifer McIver, a Legal Operations and Industry Insights expert at Wolters Kluwer ELM Solutions, commented on the findings, stating, “Expect rate dynamics to remain anything but uniform. Legal teams will need to anticipate tiered and regional shifts, as well as the growing impact of AI if they want to keep costs under control and partnerships strong in 2026.”
Analysis of services rendered in the first half of 2025 revealed a moderation in partner rate growth across law firm tiers. The top 25 firms experienced a drop in mean rate increase to 6.3% in 2025, down from 10.4% in 2024, with similar declines observed among mid-tier firms. This cooling trend is attributed to increased scrutiny from clients, signaling a shift in negotiation power despite continued overall rate increases.
Regionally, rate disparities were pronounced. New York City sustained the highest partner and associate rates, averaging $1,972 for partners and $1,214 for associates. Conversely, cities such as Cincinnati, Portland, and San Diego recorded double-digit increases, illustrating significant regional contrasts and market dynamics influenced by local demand and competitive pricing.
The report also identified significant rate volatility at the extremes of corporate revenue. Increases for the largest companies decreased to 9.9% from 15.6%, while the smallest companies saw a drop to 10.4% from 12.3%. Mid-market companies, however, maintained steady rates, suggesting that negotiation leverage and broader market forces are more heavily influencing the rates for both the largest and smallest clients.
Larger companies appear to be securing rates for Am Law 1–25 partner services that are below the mid-market peak. This is likely due to the strategic and high-volume nature of their work, which grants them substantial negotiating power. However, for engagements with Am Law 101–150 and 151–200 firms, which often involve niche and specialized services, larger companies paid higher rates than mid-market clients.
The LegalVIEW Insights series draws upon the Wolters Kluwer LegalVIEW database, which contains over $200 billion in legal invoice data. This extensive dataset allows for expert analysis of trends in legal spending across various sectors, including finance and securities, insurance, manufacturing, life sciences, and real estate. Wolters Kluwer ELM Solutions, a business within Wolters Kluwer Legal & Regulatory, offers a suite of tools designed to help corporate legal operations departments enhance operational efficiency and reduce costs, by providing innovative technology and customer experience for legal and insurance claims departments.
Wolters Kluwer, a global provider of information, software solutions, and services, operates across sectors such as healthcare, tax and accounting, financial and corporate compliance, legal and regulatory, and corporate performance and ESG. Headquartered in Alphen aan den Rijn, the Netherlands, the company reported 2024 annual revenues of €5.9 billion, serves customers in over 180 countries, and employs approximately 21,600 people worldwide.
