TIMEKEEPING & BILLING
AI was meant to shrink the billable hour. It grew.
AI was sold to legal departments as a way to shrink outside counsel bills. By two-thirds of 2026, hours were longer and rates higher.
Billable hours at US law firms grew 4.2% in the first half of the year, according to Citi's law firm advisory group, more than double the usual 1.5 to 2%. In the same year, 62% of legal departments told Wolters Kluwer they expect AI to significantly reduce billable hours. One side of the market is planning for a future the other side is not pricing in.
What The 2026 Numbers Show:
Every major billing dataset this year points the same way: more hours, higher rates, and almost no move away from hourly billing.
Measure | 2026 | For comparison |
Billable hours, H1 | +4.2% | Usual growth: 1.5 to 2% a year |
Am Law 100 blended rate | +8.1%, to $1,248/hr | +8.3% in 2025 |
Partner rates, Jan to Jul | +5.6% | Highest rise since tracking began in 2013 |
Associate rates | +7.9% | Rising faster than partner rates |
Share of billings on alternative fees | 8.4% | 8.3% in 2025 |
Create a free account to read this industry analysis
Industry analysis is free for members. It takes less than a minute to join.
Already have an account? Sign in
Was this update helpful?
Sources
- 1AI Was Supposed to Kill the Billable Hour. Instead, Big Law Is Having Its Best Year in Decades.https://www.bestlawfirms.com/articles/ai-billable-hour-law-firm-revenue-2026/8427
- 2Law Firm Billing Rates Reporthttps://brightflag.com/asset/law-firm-rates-report/
- 3AI Use for Law Firms: How Schenck Price Uses AI Beyond Productivityhttps://www.lexisnexis.com/community/insights
- 4Reshaping the legal industry – document automation & ALSPs in an era of AIhttps://www.wolterskluwer.com/en-gb/expert-insights/alsp-automation-billable-hours
- 5The Billable Hour Isn't Dying. But AI is Transforming it.https://legora.com/blog/the-billable-hour-isnt-dying-but-ai-is-transforming-it
- 6AI Isn't Killing the Billable Hour Yethttps://www.bestlawfirms.com/articles/law-firms-embrace-afas-but-clients-want-more-flexibility/7098
Continue reading
Related articles
Timekeeping & Billing
Billables AI Closes $10M Series A Round
Billables AI, a San Francisco-based legal tech company, has raised $10.2 million in a Series A funding round to expand its AI-powered platform for law firms. The raise signals growing investor confidence in operational intelligence tools built specifically for the legal sector, where data on attorne
Read article
Timekeeping & Billing
PointOne Raises $16M to Fix Legal Time Tracking
PointOne, a legal technology company, raised $16 million in a Series A round led by 8VC on to expand its AI-powered time entry and billing platform for law firms. The round matters because law firms h
Read article
Timekeeping & Billing
Querious Integrates with Smokeball to Automate Time Tracking
Querious integrates with Smokeball's marketplace to automatically capture billable time from client conversations. The Legal Conversational Intelligence platform was launched to target law firms strug
Read articleStay informed
Make your next legal technology decision with more clarity.
Join DreamLegal for independent research, market perspectives, and practical evaluation guidance for legal teams.
Create Free Account