How to Hire Regulatory & Legal Talent Strategically During Market Uncertainty
May 2026
How to Hire Regulatory & Legal Talent Strategically During Market Uncertainty
Throughout 2026, regulatory & legal hiring in the United States has faced mixed signals. Economic uncertainty, shifting federal policy priorities, AI adoption, evolving employment legislation, and increased regulatory scrutiny are making hiring decisions more cautious. But demand has not disappeared. Legal employers are seeing fewer high-volume transactional mandates in some areas, while simultaneously experiencing increased demand for complex advisory work tied to regulation, investigations, disputes, technology, compliance, and governance.
Anthony Hanna, Executive Director at Larson Maddox, explains:
In general, the need for highly skilled workers with advanced degrees and niche skillsets has not slowed down. In our case, the demand for lawyers and compliance professionals has been steady in 2026 and in some industries market sentiment is even better.
For employers, this does not mean a pause on hiring. In fact, it means becoming more intentional about where, who, and how you hire. The market may be cautious, but it is far from inactive.
Why leading US regulatory & legal employers are still hiring
Businesses are navigating AI adoption, increased enforcement activity, cybersecurity concerns, labor and employment changes, financial services scrutiny, ESG considerations, and geopolitical uncertainty. All these growing pressures are reflecting onto both law firms and corporate legal departments, and regulatory complexity is continuing to increase across industries.
AI regulation and governance remain a major focus. While the US does not currently have a single federal AI law equivalent to the EU AI Act, employers are preparing for a rapidly evolving patchwork of state-level legislation, federal agency guidance, and sector-specific compliance expectations. Regulators including the FTC, SEC, CFPB, and EEOC have all increased scrutiny around AI usage, governance, discrimination risk, and consumer protection.
Anthony notes that the AI boom is creating opportunities far beyond traditional technology companies:
The AI revolution is also presenting opportunities for data center developers/operators, hyperscalers and cloud providers, semiconductor manufacturers, and those focused on compute, power, and cooling.
Employment law is also evolving. Employers are managing changing wage transparency requirements, worker classification scrutiny, restrictive covenant reform, DEI-related litigation risk, and ongoing developments around remote work policies and employee rights. States including California, New York, Illinois, and Colorado continue to shape national hiring and compliance standards through state-level legislation.
Meanwhile, financial services, healthcare, technology, life sciences, and energy companies are all facing heightened regulatory oversight and operational risk.
While some organizations are delaying hiring approvals, others are taking advantage of the slower market to strengthen teams ahead of future demand increases.
Financial services hiring remains especially strong
Financial services has remained one of the strongest hiring markets for legal and compliance talent in 2026, despite broader economic uncertainty, says Anthony:
We have seen the finance sector be particularly strong, specifically trading firms, hedge funds, broker-dealers, and banks with sales and trading arms. Public markets have been very volatile in 2026 which is great for these firms as their revenues tend to increase in times of rapidly fluctuating markets.
Volatile public markets typically create favorable operating conditions for market makers, broker-dealers, and sales & trading platforms, driving materially higher revenues across trading, execution, financing, and risk management activities. Elevated volatility increases market participation and turnover as institutional and retail investors reposition portfolios, manage exposure, and react to macroeconomic and geopolitical developments.
For broker-dealers and trading firms, this environment generally results in:
- Increased transaction volumes, leading to stronger commission generation, exchange-related revenues, and payment for order flow activity
- Wider spreads and increased market-making opportunities across equities, fixed income, FX, and derivatives products
- Higher client demand for hedging, structured products, and derivatives execution as market participants seek downside protection and volatility exposure
- Increased utilization of prime brokerage, securities financing, and liquidity solutions by hedge funds and institutional clients
The resulting increase in trading activity and regulatory complexity has also sustained demand for legal and compliance professionals with expertise across sales & trading, market structure, broker-dealer regulation, derivatives, financial crime, and regulatory advisory functions.
Hedge funds have also benefited from volatility depending on strategy type and market positioning, explains Anthony:
Volatility creates a richer ‘hunting ground’ for talented hedge funds to generate superior performance, but it also increases complexity and regulatory risk.
Banks have similarly benefited from elevated client activity and trading flow:
Investors, hedge funds, corporates, and institutions rebalance portfolios, hedge risks, or speculate amid price swings. This surges client-driven trading, generating commissions, bid-ask spreads, and fees.
As a result, demand has remained high for legal and compliance professionals supporting sales & trading, market structure, regulatory advisory, financial crime, derivatives, broker-dealer compliance, and investment management functions.
Where competitors are hiring in the US legal & regulatory market
Leading employers are focusing hiring efforts into functions that directly support risk management, compliance, governance, revenue protection, and long-term operational resilience.
AI governance and technology regulation
AI adoption is creating significant demand for lawyers and compliance professionals who can advise on AI governance, privacy, vendor oversight, product liability, cybersecurity, algorithmic bias, intellectual property, and technology risk. Anthony says:
We have seen strong demand for AI lawyers that are focused on AI governance, have a strong understanding of data privacy concerns as related to AI, and can effectively influence AI product development ranging from working with engineering teams to marketing teams.
Organizations also increasingly need professionals who can translate emerging regulation into practical commercial guidance, while supporting innovation responsibly.
Healthcare and pharmaceutical regulatory lawyers
Healthcare and life sciences hiring has also accelerated, particularly around pharmaceutical regulation and telehealth compliance, as Anthony explains:
GLP-1s have been a boon to many pharma companies and we expect this trend to continue. The demand for these products has also benefited healthcare providers and telehealth companies, and telehealth has become the primary access channel for millions of patients seeking GLP-1s.
At the same time, regulatory scrutiny has increased significantly.
The FDA issued 30+ warning letters to telehealth companies marketing compounded GLP-1s. This has increased the need for regulatory lawyers at these companies, which we have seen be in high demand in 2026.
Private credit and securitizations
Private credit and structured finance continue to be particularly active hiring markets, Anthony notes:
Private Credit and securitizations lawyers have been in particularly hot demand at both investment funds and investment banks.
Growth in private credit is increasing demand for legal professionals who can support origination, structuring, risk management, regulatory advisory, and securitization activity. He adds:
Deal volume is surging at the same time as structures are getting more complex, more regulated, and more bespoke. CLO issuance alone is projected at roughly $220B in the US in 2026. The supply of this talent is very limited, making it an incredibly candidate-driven market.
Data privacy, cyber, and digital regulation
Cybersecurity incidents, evolving state privacy laws, and increasing digital regulation are driving demand for lawyers who can combine technical understanding with practical business advisory skills.
Professionals with expertise in data governance, breach response, incident management, cyber compliance, and digital operational resilience remain highly sought after.
Senior legal leadership and legal transformation
Corporate legal departments are under pressure to do more with leaner resources. This is increasing demand for General Counsel, Heads of Legal, Chief Compliance Officers, legal operations leaders, and senior regulatory professionals who can improve efficiency, modernize legal functions, and support strategic business decisions.
Organizations are also investing in professionals who can help implement legal technology, optimize workflows, and integrate AI into legal operations responsibly.
Why top legal talent becomes more accessible during cautious markets
Periods of uncertainty often make high-performing professionals more open to new opportunities, but not because they are acting reactively. Anthony explains:
Despite news of layoffs in certain industries, competition for highly skilled workers is still competitive and good candidates will likely have multiple offers on the table.
At the same time, market uncertainty is changing how candidates engage with opportunities:
There is a perception of uncertainty in the market from some candidates, therefore the best ones with current job security are unlikely to actively apply to job postings.
This means employers must become more proactive in how they engage talent:
Unlocking these passive candidates will require strong referral networks from current employees, proactive reach out to candidates about opportunities, or utilizing specialist recruitment firms that are plugged into candidates on the market that are more passively open to hearing about new opportunities.
For employers, this creates a valuable hiring window. The strongest candidates may not be actively applying to roles, but they are willing to engage when opportunities offer:
- Exposure to high-impact work
- Strong leadership and mentorship
- Clear progression opportunities
- Flexible career structures
- Investment in training and development
- Long-term market relevance
Compensation trends and workplace flexibility
Compensation pressure remains present, although salary growth has started to normalize. Anthony advises:
Salary growth has normalized as across the US base salary increases for current employees are flat at 3-3.5% for 2026, unchanged from 2025.
However, employers should still expect meaningful increases when hiring passive talent:
Passive candidates are typically seeking around a 15-20% compensation increase from their current comp in order to make a move.
Workplace flexibility also continues to influence hiring and retention decisions, particularly across financial services:
Many financial services firms are continuing to transition to 5 days in the office, causing some candidates at these firms to look for employers with more flexible in-office requirements. This presents a great opportunity for financial services companies that offer 3 or 4 days per week in the office.
The cost of pausing hiring for too long
A hiring freeze may protect short-term budgets, but in legal and regulatory teams it can quickly create operational and strategic risk.
For law firms, delayed hiring can leave practice groups under-resourced when demand increases around AI governance, employment litigation, investigations, privacy, cybersecurity, or financial regulation. These are highly specialized areas where experienced professionals cannot be hired or developed overnight.
For in-house teams, prolonged hiring pauses can place additional pressure on already lean legal and compliance functions. As regulatory complexity grows, gaps in legal, compliance, privacy, and financial crime teams can impact governance, commercial decision-making, response times, and risk management capabilities.
In active specialist markets, strong professionals are often hired quickly once they decide to move. Delayed hiring processes or prolonged indecision can result in losing talent to competitors who are prepared to move faster.
How to improve your US legal & regulatory hiring strategy in 2026
The most effective hiring strategies are aligned directly to business outcomes. Depending on your organization’s priorities, this may mean focusing hiring efforts on roles that support:
- AI governance and technology regulation, including AI compliance, data privacy, cybersecurity, vendor oversight, product liability, and technology contracting
- Employment and workforce change, including labor relations, wage transparency, worker classification, workplace investigations, and employment litigation
- Regulatory readiness and enforcement response across financial services, healthcare, AML, consumer protection, securities, ESG, and data privacy
- Commercial and funds advisory, including private equity, asset management, governance, regulatory structuring, and investor communications
- Legal transformation and operational modernization, including legal operations, workflow optimization, AI implementation, and resourcing strategy
- Succession planning at Senior Associate, Counsel, Partner, General Counsel, Chief Compliance Officer, and senior regulatory leadership level
- Retention of high-performing professionals through clearer progression, training investment, and flexible working models
Checklist: key regulatory & legal hiring priorities for 2026
Hiring effectively during market uncertainty starts with focusing on where talent can create the greatest business impact. Practical steps employers can take now include:
- Map critical legal and compliance roles against regulatory risk, business growth, client demand, and succession plans
- Identify where competitors are continuing to invest in hiring
- Benchmark compensation and market expectations before launching searches. Explore our range of compensation guides
- Review progression and retention strategies for mid-level talent
- Build proactive talent pipelines before hiring needs become urgent
- Keep interview processes short, structured, and aligned internally
Anthony recommends:
Interview processes should be streamlined. We recommend one or two screening calls with a key decision maker, followed by one larger panel-style interview where candidates meet both direct team members and key stakeholders.
He also emphasizes the importance of candidate experience:
Companies that have called candidates to congratulate them on receiving an offer and making themselves available to discuss any questions at the end of the process tend to have an upper hand.
Additional priorities include:
- Providing candidates with clear information on progression, flexibility, training, leadership structure, and decision timelines
- Moving quickly once the right candidate is engaged
- Using interim or contract solutions where demand is uncertain while continuing to invest permanently in core capability areas
- Preparing for counter offers before final interview stages. Read our advice for employers on reducing counter offer risks
- Making AI training and regulatory readiness part of the employee value proposition
Build the legal & regulatory teams your competitors will wish they secured earlier
Market uncertainty is creating a rare opportunity for US legal and regulatory employers to secure specialist and senior talent before confidence fully returns.
Larson Maddox helps law firms and in-house legal teams identify, engage, and hire professionals across key industries, solving complex hiring challenges through specialist market knowledge, established candidate networks, and deep insight into compensation trends, competitor activity, and candidate expectations.
Request a call back today to discuss how your organization can hire the specialist and senior regulatory & legal talent needed to navigate market uncertainty and emerge stronger.