Identifying key 2010 trends for legal and professional services recruitment, the 2010 Mahlab Market Update found an improvement in market conditions since 2009 will mean more employment opportunities will emerge and salary freezes will begin to lift.

This year retention strategies will be a big focus for firms, with lawyers keen to take career steps now that the market has stabilised.

"Retention is going to play a big role over the next 12 months. Not just for law firms, but for many businesses," says managing director of Mahlab Recruitment (NSW) Lisa Gazis.

"The factors that will impact on retention will be very much how each individual felt the firm treated them or their colleagues during the financial crisis [and] whether they felt their career progression had stalled," says Gazis.

How firms react in 2010 will also have an impact on retention. "How firms and employers generally responded to the global financial crisis and how they are now going to respond, with the new markets, will also influence retention," says Gazis.

This focus on retention strategies will bring positive outcomes for lawyers, according to Gazis. "Flowing on from [the focus on retention] will be better conditions, a greater focus on demonstrating career development and also consideration [will be] given to salary freezes and bonuses."

"The fact that there is greater optimism in the market means there is recognition by firms for the need to increase salaries," says Gazis.

The Mahlab update emphasised an immediate challenge for firms - how salary reviews are to be managed in 2010 - and noted that although the expectations of lawyers will be varied, most lawyers will expect a significant pay rise to compensate for salary freezes during the last financial year.

Gazis says some salary freezes are beginning to lift and that firms are starting to announce plans to review salaries. And, according to the update, a number of top-tier firms have already offered bonuses and quarterly payments to strongly performing employees. Gazis believes some reviews will commence this month, with further reviews planned for May and June.

Recognising that the international market has been the most challenging for lawyers, law firms and recruiters, the Mahlab update found demand for Australian lawyers will remain limited in the US and the UK and warned Australian and New Zealand-qualified lawyers who are considering a move to international jurisdictions to hold off until the end of 2010.

"We might see some signs of the international market in the UK improving towards the end of the year," says Gazis. But for the US market, she said Australia won't experience any demand until about 2011.

While there have been increased signs of optimism and increased activity, Gazis adds that it is still, to a degree, an "employers' market" for at least the short-to-medium-term. She says lawyers need to bear in mind that the market is still not a buoyant market.

"We still have a long way to go to improve significantly. Whilst there will be positive things happening in the market, [lawyers'] expectations may still not be met.

"We're still working in a very constrained market."

- Briana Everett