Over 70% of legal firms are experiencing technical skills shortages, particularly in cyber, data, and solution development. But the problem isn't a lack of qualified engineers—it's that top technical talent actively avoids the legal industry.
As AI and automation reshape legal services, firms unable to attract engineering talent will fall behind competitors who successfully compete for scarce technical resources.
Legal tech companies compete against technology giants offering significantly higher compensation. A senior software engineer at Google or Meta earns $300K-$500K total compensation. Legal tech companies typically offer $150K-$250K for similar roles.
The gap extends beyond base salary. Tech companies provide substantial equity packages that multiply during liquidity events. Legal tech exits are smaller and less frequent, making equity less compelling.
But compensation alone doesn't explain the shortage. Engineers also weigh non-financial factors heavily.
Engineers want to work on problems that excite peers and enhance resumes. Legal tech lacks the prestige of consumer tech, fintech, or enterprise SaaS.
At technology conferences, building consumer apps or scaling infrastructure for millions of users generates excitement. Building document automation for law firms doesn't. This perception gap makes recruiting difficult—top candidates simply don't consider legal tech.
The problem compounds through network effects. Few engineers have friends in legal tech, reducing referrals and social proof. Legal tech companies struggle to build the engineering brand recognition necessary to compete.
Engineers gravitate toward interesting technical problems. Consumer tech offers scale challenges. Fintech provides complex distributed systems. Enterprise SaaS tackles integration puzzles.
Legal tech's challenges often seem less compelling: document processing, workflow automation, search optimization. While these have real complexity, they don't typically excite engineers.
The exception: AI and machine learning applied to legal. Companies like Harvey and Casetext attracted strong AI talent by positioning as AI companies solving legal problems rather than legal companies implementing AI. The framing matters.
Legal industry culture clashes with modern engineering culture. Law firms operate hierarchically with conservative decision-making. Tech companies embrace flat organizations, rapid experimentation, and failure tolerance.
Engineers expect autonomy, fast iteration cycles, and product influence. Legal tech companies serving conservative law firms often face slow sales cycles and resistance to change—frustrating for engineers accustomed to shipping quickly and seeing immediate impact.
Remote work creates additional friction. Over 70% of tech workers expect flexible remote options. Many legal tech companies maintain traditional office requirements that repel talent.
In mainstream tech, clear paths exist from individual contributor to distinguished engineer, with increasing compensation at each level.
Legal tech companies often lack well-defined technical career paths. Small teams mean limited advancement. Engineers worry about skill atrophy—years in legal tech might make transitioning to mainstream tech difficult.
Despite these challenges, some legal tech companies successfully attract talent:
→ Position as technology companies first. Harvey raised $300M positioning as an AI company, not a legal tech company.
→ Offer market-rate compensation. Clio, valued at $3B, competes on compensation with mainstream SaaS companies.
→ Build remote-first cultures. Allow engineers to work from tech hubs regardless of headquarters location.
→ Emphasize impact and autonomy. Small teams mean engineers have significant product influence.
→ Hire from adjacent fields. Recruit from document management or workflow automation rather than requiring legal tech experience.
→ Invest in an engineering brand. Publish technical content, speak at conferences, and contribute to open source.
This isn't just a hiring problem—it's a strategic disadvantage. As AI transforms legal services, companies with strong engineering teams will build superior products faster.
Legal tech companies that solve the talent problem gain compounding advantages. Strong teams attract more engineers through referrals. Better products justify higher compensation. Success breeds success.
The firms that crack this challenge will dominate their categories. Those that don't will become acquisition targets.
The legal tech talent crisis won't resolve itself. Companies that adapt their recruiting, compensation, and culture to compete for engineering talent will build sustainable competitive advantages in an increasingly technology-driven market.