Deloitte Legal 2026: Hourly Work Projected to Fall from 72% to 44% — AFA Growth of Up to 50% in Three Years

Deloitte Legal's The AI Imperative — based on 121 senior legal leaders surveyed globally — contained the most-cited pricing projection of the week: hourly-rate work is expected to fall from 72% of legal fees today to 44% within two to three years, with the share displaced by AFAs, value-based structures, and outcome-aligned arrangements. The AFA growth projection is even more specific in some geographies: up to 50% rise in the volume of alternative fee arrangements over the next three years — a pace that, as Law Firm Pricing noted in its July 11 analysis, "AFAs have never had a 3-year surge like the one predicted." The report frames this not as an industry-driven move but as a client-forced renegotiation: 78% of GCs say cost reduction is the leading benefit they want from AI use by outside counsel, and 55% explicitly list increased innovative pricing as a priority. For pricing directors and firm CFOs, the Deloitte projection creates a compliance problem as much as a strategy one: firms that do not build AFA pricing infrastructure now — matter budgeting tools, outcome tracking systems, phase-based costing models — will be asked to produce AFAs under deadline pressure by clients who have already made the decision, rather than designing them on terms favorable to the firm.