While debate continues about the likelihood of recession and its severity, this development will be seen as further evidence that a downturn in the economy is imminent. This is bad news for most, but for some lawyers, it offers a chance to boost substantially their already considerable earnings.
"Insolvency work was a major source of income during the last recession, and we would like it to be so again" said John Rink, managing partner at Allen & Overy. "We stay very close to our clients, and we know what effects events in Asia are having on them. And we know what effect the pressure of the pound is having on our clients here, and we talk to them."
Nicholas Frome, partner in charge of insolvency at Lovell White Durrant, said: "We certainly have some additional recruits, but we've got a very strong insolvency base, so I'm not sure that we see a huge need to be adding too many numbers to those at the moment. But we know others are. They keep knocking on our door, trying to nick our assistants and that kind of thing. We have seen it before because we are an obvious source of trained insolvency lawyers."
Other firms are also reporting having staff poached by firms looking to make the most of a recession. The demand for insolvency lawyers has also been fuelled by the fact that many have relocated to deal with corporate problems in Asia.
While some firms consider insolvency work as a core part of their business, others simply hire insolvency lawyers when they sense a recession approaching. Duncan Mosley, a partner of Dibb Lupton Alsop, which specialises in insolvency, said: "A lot of firms treat insolvency work with a bandwagon approach: they see something coming and jump on. There are a few commercial lawyers and a few litigators who in the good times don't do any insolvency work, and then turn their hand to it when a recession comes along."
And it is not just established firms that see opportunities. An article in Lex, a careers magazine for aspiring lawyers, is advising its readers that other peoples' misfortunes may provide a welcome opportunity for the newly-qualified lawyer looking for work.