This is the next article in my series on why there will be fewer law firms at the end of 2017 then there are today. My last article discussed just a few of the reasons why technology is eliminating the number of law firms. The big thing to understand is that the reduction in the number of firms is going to accelerate during 2017 and in the coming years. This is going to result in quite a few attorneys looking like this:
and the sad thing, to be blunt, is that most will not have seen it coming even though the warning signs are everywhere. The fact of the matter is that most lawyers and legal professionals are just happily strolling along as if they were this guy:
Fortunately, you’re reading blogs and articles such as this and that means you can prepare yourself for what’s coming. So let’s use this time to discuss how coming technology and artificial intelligence advancements will quickly wipe out legal jobs and law firms.
Driverless technology is going to eliminate law firms in 2017
Driverless technology is in the news a lot right now. While it’s often talked about as technology that’s “coming,” the fact of the matter is that it’s already here. The reason why the news feels this tech hasn’t arrived yet is that they are defining “driverless cars” as vehicles which are fully autonomous. That’s a flawed definition. There are many aspects of driving. Anything that takes control away from the driver, and puts it in the hands of AI is a form of “driverless technology.” In other words, we won’t just wake up one day to cars driving themselves. It’s going to be a gradual evolution in which more and more of the functions become automated. Let’s talk specifics and how this impacts you.
An increasing number of cars are coming with technology known as “front crash prevention.” This technology encapsulates everything from the driver receiving a warning that they are about to be in a crash to the vehicle’s computer actually hitting the breaks. Just a few years ago you had to buy a luxury car to get this technology but now its increasingly available in more affordable cars1. It is estimated that this type of technology can reduce rear end collisions by up to forty percent2. Auto makers have vowed to make auto breaking technology standard by 20223. Why am I talking about this? Because in 2015 it was reported that the U.S. endures about 1.7 million rear end collisions per year4. If even twenty percent (a low number) of the cars on the road are equipped with automatic breaking then that would take 136,000 car accidents per year out of the system (based on the statistic that such technology leads to forty percent fewer accidents). Again, this part of driverless technology is in many cars now (including the Honda Civic my in laws just bought). Also, this technology is going to be standard in all models by 2022.
Areas that will get hit hard by this technology are personal injury attorneys (for obvious reasons), insurance defense firms (also for obvious reasons), as well as business and employment law attorneys. You may be wondering why I mention those who practice business and/or employment law? Simple. Car accidents generate many jobs in the U.S. and if fewer people have jobs then there are fewer disputes for employment law lawyers to handle. Consider that every one of those 1.7 million rear end accidents means work for a police officer who visits the scene, a tow truck driver, an insurance adjuster, workers at the auto body shop, attorneys, and many others whom I’m not mentioning. Driverless technology is going to be throwing a lot of people out of work which, in turn, eliminates the number of cases for an employment law attorney to handle. Obviously, fewer car accidents are a good thing; I’m writing this strictly from a law firm business perspective.
Think rear end collision prevention is going to eliminate a lot of the work available to attorneys? Just wait until vehicles are fully autonomous. Ford has said that it will be there 20214. Fully autonomous vehicles will remove from the system, almost completely, the following: car accidents (wiping out personal injury firms), DUI cases, and a lot of jobs (which will hurt employment law attorneys even more).
Advances in cloud computing and artificial intelligence is going to decimate the legal profession in short order
This is a “techie” part of the discussion but it’s important that you understand it.
My last article discussed how advances in artificial intelligence, such as IBM’s “Watson,” and other technology have created systems capable of doing work typically performed by junior associates. If you haven’t read that article then click the link at the beginning of this post. The big thing that is crucial for attorneys to understand is that Moore’s Law (the idea that computing power will double roughly every two years) is also being shown to apply to artificial intelligence. As this technology becomes cheaper and more powerful it will be found in more and more applications which can replace attorneys (such as what’s happening at the businesses I mentioned in my last article). We are now hitting a tipping point where this type of technology is going to become increasingly available to software developers.
In 2010, a cloud software developer (such as the ones who are building the technology that is replacing attorneys) paid fifteen cents per gigabyte of data over Amazon’s S3 cloud service5. As of today that same data can be accessed for two cents per gigabyte. So the cost for a software developer to access the resources that power AI-backed applications has dropped by 87 percent in just seven years. I’m explaining this to get the point across that the technology, which will be automating much of the work currently performed by attorneys and law firms, is becoming cost effective at a rapid pace. The effect of this? Firms will do much more with less which, at the end of the day, means that there will be fewer law firms out there. The advancements we see in these areas, starting this year, are going to be extreme.
The automation of the legal profession is just a subset of what’s going on in our larger society. In 1998 US workers worked a total 194 billion hours. In 2013 (fifteen years later) workers produced 42 percent more in goods and services (adjusted for inflation) then they did in 1998. That 2013 production came with just 194 billion hours of labor6 (think of what that means for business and employment law attorneys). When you consider population growth this means that the average person produced more while working fewer hours. People are working less and producing more due to automation – that includes lawyers. This trend is only going to continue.
Technology is eliminating the work that attorneys perform as well as the need for lawyers themselves
The bottom line of all this is that automation is wiping out much of the demand for work done by attorneys. It’s also automating much of the work that’s not being eliminated by disappearing demand. This is going to hit law firms hard.
How do you see automation impacting the legal profession. Please chime in through the comment form below.
1 IIHS: In the best light2017 TOP SAFETY PICK+ winners meet new headlight criteria; accessed at: http://www.iihs.org/iihs/news/desktopnews/in-the-best-light-2017-top-safety-pick-winners-meet-new-headlight-criteria
2 IIHS: Crashes avoidedFront crash prevention slashes police-reported rear-end crashes; http://www.iihs.org/iihs/news/desktopnews/crashes-avoided-front-crash-prevention-slashes-police-reported-rear-end-crashes
3 Consumer Reports: Virtually All New Cars to Have Standard Automatic Emergency Braking by 2022; http://www.consumerreports.org/car-safety/all-new-cars-to-have-standard-automatic-emergency-braking/
4CNBC: Ford aims for self-driving car with no gas pedal, no steering wheel in 5 years, CEO says; http://www.cnbc.com/2017/01/09/ford-aims-for-self-driving-car-with-no-gas-pedal-no-steering-wheel-in-5-years-ceo-says.html
6 Martin Ford: Rise of the Robots – Technology and the Threat of a Jobless Future, Conclusion Section