Law firms struggled to cope with a drop in demand across nearly all practice areas during the second quarter, according to Thomson Reuters’ Peer Monitor Index, but Texas and its neighbors in the southwest region fared better.

Demand, measured by hours billed, declined overall and in four of five U.S. regions during the second quarter, the report found. The Southwest was the outlier, registering an uptick of 1.1 percent. Demand declined by 0.1 percent in the northeast, 0.2 percent in the midwest, 1.3 percent in the west and 3.3 percent in the southeast.

Peer Monitor said that the downturn in demand nationally had “blindsided” law firms after steady demand growth going all the way back to the first quarter of 2014. Demand dipped by 0.9 percent during the second quarter, the largest quarterly drop in more than three years.

Productivity also declined nationally, but the southwest region also bucked the trend there. Productivity dropped by 2.8 percent overall, but it improved by 0.7 percent in the southwest. It declined by 1.8 percent in the midwest, 3.8 percent in the southwest, 3.9 percent in the northeast and 4 percent in the west, according to the report.

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