Law firms are experiencing unprecedented pressure from the rapid advancement of AI, which is affecting their talent recruitment, client relationships, and business models, according to deeper analysis of the recent Thomson Reuters 2026 Future of Professionals Report.

To help law firms navigate this AI-driven disruption, Thomson Reuters has published a new action paper, Future of Professionals Report 2026: Actionable insights for law firm leaders, drawing on insights from 736 law firm professionals and 203 corporate legal professionals.

Indeed, the new paper highlights that almost one-quarter of law firm professionals will refuse a job offer if the prospective firm lacks professional-grade AI tools. Further, any perceived misalignment between a professional’s AI preferences and the firm’s strategy increase the risk of attrition, especially among those professionals who value mentorship and skill development.

You can download your copy of the 2026 Future of Professionals Report here

In addition, almost one-third of corporate legal professionals say they are reconsidering relationships with outside law firms that do not demonstrate how they’ll offer clear AI-enabled value within the next 12 months, the paper notes. And clients increasingly expect their outside counsel to deliver efficiency, quality, and innovation through AI; however, only between 3% and 6% say they believe most of their outside firms are meeting each of these expectations.

Finally, almost 4-in-10 law firm professionals say they are feeling financial pressure to act faster on AI, yet almost two-thirds say their firm’s pricing structure remains unchanged despite clients’ demand for new models that reflect AI-driven efficiencies and increased value.

The paper notes that firms with approved AI tools are more attractive to talent, while the use of unauthorized “shadow AI” by more than one-third of professionals creates security and compliance risks. To address this, firms should provide transparent AI solutions and invest in training. While AI may reduce demand for some junior roles, it may increase the need for others, especially hybrid tech-legal roles.

On the client relationship front, many corporate legal departments are facing internal pressure to adopt AI and expect their outside law firms to keep pace. In-house legal teams increasingly expect AI-enabled productivity, quality, and innovation, yet many see a significant gap between expectations and delivery. For example, 70% say they expect productivity gains, while only 6% say they believe most of the firms they work with are delivering them.

Clients, for their part, also expect pricing models that reflect AI-driven efficiencies through greater cost certainty and transparency. Outside law firms that fail to adapt may risk fee pressure, ultimately losing business to more agile competitors.

Only half of professionals see their firm’s AI strategy reflected in their daily work, and this potential misalignment could cause talent and AI adoption problems.

Fortunately, amid all these challenges for law firm leaders, the paper identifies three strategic paths law firms can take, including:

• Using AI to elevate by automating routine tasks that would then allow professionals to handle complex, high-value work.

• Using AI to scale by prioritizing productivity and efficiency and handling high volumes of routine work with AI and human oversight.

• Using AI to reimagine by rebuilding the firm around AI and offering new models like outcome-based pricing and embedded partnerships.

Unfortunately, some firms are choosing to defer this crucial decision, which increases their risk of client and talent attrition as the market evolves.

Whichever path law firms take, however, the paper makes clear that firm leadership must clearly communicate their AI strategy. The paper notes that only half of professionals see their firm’s AI strategy reflected in their daily work, and this potential misalignment could cause talent and AI adoption problems.

The paper encourages firms to move quickly to close the gap between client expectations, talent needs, and operational realities by defining a clear AI strategy, investing in training and tools, and adapting pricing models for an AI-driven market.

Using the guidance from this action paper, firm leadership can navigate these challenges and move their law firm into a more responsive, profitable, and sustainable AI-enabled future.

You can read a full copy of the Future of Professionals Report 2026: Actionable insights for law firm leaders paper here