The moribund state of the UK litigation recruitment market is hardly surprising. Litigation has always been regarded as a counter-cyclical activity. And then there is the impact of the Woolf reforms. In such an environment, you are hardly going to get a rush of lateral hiring or – for that matter – internal promotions. At Lovells and Fresh-fields Bruckhaus Deringer, which acted opposite each other in the Bank of England/BCCI dispute, not a single London-based commercial litigator was admitted to the partner-ship this year, while at Herbert Smith just one commercial litigator made the grade. Barlow Lyde & Gilbert, which has become something of a bellwether for the health of the litigation market, recorded a drop in turnover during what was a record financial year for many top 50 firms.

Does this spell the death knell for litigation departments in the leading UK commercial firms? For as long as clients are vulnerable to dawn raids or reputation-critical disputes, these practices will remain committed to litigation. After all, turning down calls for help from your client during its hour of greatest need is never likely to go down well.

But even those litigators who observe the market with rose-tinted spectacles acknowledge it has changed profoundly. There is a dearth of commercial disputes reaching the courtroom with a much greater focus on less lucrative – and, from the point of view of lawyers, less stimulating – preparatory work. While the rise in international arbitration and a discernable increase in regulatory work have partly compensated, London litigation departments have inevitably lost some muscle. One of the most symbolic effects of this change is the decision of the leading firms to stop acting against the major banks. It follows from this that, for this vital sector, litigators have entered the category of support lawyers. Regulatory work – the one significant UK litigation 'hot spot' – also falls squarely into this category.

It is a different story in the US, where three of the five dispute resolution specialists who made partner at Lovells are based. Indeed, a growing number of UK firms appear to be coming to the view that litigation could unlock the door to this most competitive of markets.

In his recent interview with Legal Week, Allen & Overy managing partner David Morley signalled a desire to grow the firm's New York litigation practice, while Linklaters kicked off its New York push two years ago with the hire of a trio of litigation partners from Shearman & Sterling, including office head Paul Wickes.

The balance of power within UK firms may have shifted away from the litigators in London, but it is moving in the other direction across the pond.