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From US manufacturers, about one lawyer per 1,000 employees but barely any association with total legal spending

To find out whether lawyers per thousand employees makes any difference in total legal spending. I took data from 39 US and Canadian manufacturing companies that participated in the General Counsel Metrics benchmark survey last year. For each I calculated the number of lawyers they had per thousand employees – a median of exactly one. Thus, a manufacturer with 1,000 employees if typical for this group had one in-house lawyer. The average stood higher, at 2.4 lawyers per 1,000 employees.

Then I calculated total legal spend as a percentage of revenue. The median for the group was 0.41% while the average was 0.52%.

The correlation between the two metrics was very slightly negative at -.04, which suggest very slightly but not very reliably that the more lawyers as a percentage of employees the less the company spends on legal. In-sourcing makes economic sense.

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