Archive for the ‘Associates’ Category

New law school grads

June 20th, 2013 by Altman Weil

NALP has released their latest numbers on employment and starting salaries for new law school graduates.  The data represents the status of the Class of 2012 as of February 15, 2013 (about nine months after graduation).

 

  • Overall employment for 2012 grads is 85.5%, down for the 5th year in a row

  • 64.4% of graduates got a job requiring a JD, the lowest percentage NALP has ever recorded

  • Half of employed graduates found a job in private practice

  • Median law firm starting salary was $90,000, up from $85,000 last year

Read it at NALP

New associate comp survey

September 20th, 2012 by Altman Weil

NALP’s new research on associate compensation is a timely complement to yesterday’s BigLaw partner compensation survey news.  They found that fewer new hires are collecting top dollar ($160K) salaries right out of law school.

“Recent research from NALP reveals that, although first-year associate salaries of $160,000 are still widespread at large law firms of more than 700 lawyers — especially in large markets — that figure no longer represents the prevailing salary, resulting in a median for this group of firms as a whole of $145,000, a median figure last seen in 2007. In the intervening years at least half the first-year salaries in firms of this size were reported at $160,000, with the proportion reaching a high of nearly two-thirds in 2009, confirming the characterization of 2009 as the recent high point for large firm salaries. “

But overall first year salaries are up somewhat…

“NALP’s 2012 Associate Salary Survey reports that the overall median first-year salary at firms of all sizes was $125,000, up from $115,000 in 2011. Medians ranged from $70,750 in firms of 2-25 lawyers to $125,000 in firms of 501-700 lawyers, and $145,000 in firms of 251-500 lawyers and in firms of more than 700 lawyers. The median at firms of 251-500 lawyers had been at $125,000 from 2009 to 2011, while that at firms of 501-700 lawyers edged up from $120,000, reflecting relatively more reporting of salaries of $125,000 in 2012 compared with 2011.”

The NALP survey included data from 570 law firms of all sizes.

Read it at NALP

Rainmaker mentor program

August 15th, 2012 by Altman Weil

The ability to build a significant book of business has never been more critical for lawyers who aspire to partnership.   This can be difficult for most young lawyers, and particularly challenging for diverse attorneys who may not have the same access to relationship building and networking opportunities. 

As part of a program introduced by the Philadelphia Diversity Law Group, Virginia Essandoh, Chief Diversity Officer at Ballard Spahr (and Altman Weil alum), led a rainmaker mentor program at Ballard that paired an established partner with a diverse associate.  In the pilot program the mentor was chosen for “diversity insight, a superb reputation and a spectrum of contacts.”  The mentee was “a rising star with partnership aspirations and the enthusiasm to commit additional time and effort to this initiative.”

Essandoh concludes:

“The best practices learned from this initial match will cast the model for a new component of a firmwide mentoring program at Ballard Spahr. The fortunate outcome is that this pair of lawyers has become friends. That is perhaps the finest way to enrich business relationships.” 

Read it at The Legal Intelligencer 

Starting salaries for new law school graduates

July 13th, 2012 by Altman Weil

It’s ugly out there for new law grads.  NALP, the National Association for Law Placement, has released a new study on starting salaries for the Class of 2011, as well as some trend data from the last three years.

According to their press release:

“The median starting salary for new law school graduates from the Class of 2011 fell 5% from that for 2010 and has fallen nearly 17% just since 2009… The research also reveals that the median starting private practice salary fell over 18% from 2010 and since 2009 has fallen an astonishing 35%. These are among the most dramatic findings that were released this week from NALP’s Employment Report and Salary Survey for the Class of 2011.”

“This drop in starting salaries, while expected, is surprising in its scope” according to NALP’s Executive Director James Leipold. “Nearly all of the drop can be attributed to the continued erosion of private practice opportunities at the largest law firms.”

Read it at NALP

More bad news for new lawyers

June 19th, 2012 by Altman Weil

This month, the American Bar Association (ABA) and the National Association for Law Placement (NALP) have both published the latest dismal statistics for new law school graduates.  The National Law Journal profiled their findings:

“Slightly more than half of the class of 2011 — 55 percent — found full-time, long-term jobs that require bar passage nine months after they graduated, according to employment figures released on June 18 by the American Bar Association.

The statistic was perhaps the most sobering in a season of bad news about new lawyer employment. Less than one week earlier, the National Association for Law Placement reported that only two-thirds of new graduates landed any type of job requiring their law degree, and that the overall employment rate hit an 18-year low at 85.6 percent.”

Read it at law.com

Additional data from the NALP report noted that jobs in private practice also dropped in 2011:

“Not quite half (49.5%) of employed graduates obtained a job in private practice, a drop from 50.9% for the Class of 2010, which in turn was a full 5 percentage point decline from 2009. In most of the 38 years for which NALP has collected employment information, the percentage of jobs in law firms has been in the 55-58% range and has been below 50% only once before 2011.”

Read it at NALP

Supporting this gloomy picture, Altman Weil’s 2012 Law Firm’s in Transition Survey reported that 25.8% of law firms either reduced or discontinued hiring of first-year associates in 2011.  And 55.4% of firms think that reduced first year classes will be a permanent trend going forward.

Read it at Altman Weil

The ABA Section on Legal Education and Admissions to the Bar has an online tool that allows you to generate a report summarizing employment results for 2011 graduates of any US law school.  They also provide a downloadable spreadsheet of all results for 2011 graduates.

Read it at ABA

Associate salary update

September 9th, 2011 by Altman Weil

NALP (the National Association for Law Placement) has issued its annual report on associate salaries.  The NALP study provides a broad look at firms of all sizes around the US, and provides a good complement to the ALM Midlevel Associate Survey data we noted earlier this week.  Some of NALP’s findings include:

  • Associate salaries were largely flat in 2011 compared with 2010, with the $160,000 salary for first-year associates still prevailing at large firms in a number of markets, including Chicago, Los Angeles, New York, and Washington, DC.
  • In other markets, such as Boston and San Francisco, the median remained at $145,000, after reaching $160,000 in 2009 and then falling back to $145,000 in 2010.
  • The overall median first-year salary was $115,000, unchanged from 2010.
  • Medians ranged from $73,000 in firms of 2-25 lawyers to $120,000 in firms of 501-700 lawyers, and $160,000 in firms of more than 700 lawyers.

Read it at NALP

Associate satisfaction survey

September 1st, 2011 by Altman Weil

The American Lawyer has released it latest Midlevel Associate Survey.  After surveying 5,000+ third-, fourth- and fifth-year associates, the survey found the lowest overall satisfaction score since 2004.  The reason for associates’ discontent is work load.

“Midlevel associates put their noses to the grindstone last year, and they didn’t like it one bit. While demand for legal services rose in the last year, staffing at the country’s biggest firms continued to lag behind prerecession levels. As a result, third-, fourth-, and fifth-year associates had their most demanding year since the recession began. They averaged 2,037 billable hours in 2010, compared to 1,957 the previous year. While the increase was only 80 hours (or two weeks of work to most associates), it represented the highest number of associate billable hours since 2007.”

Altman Weil’s Eric Seeger commented that law firms continue to be cautious about hiring. “That’s a normal business response in a questionable economy,” says Seeger. “Firms are not going to be in a hurry to staff up to prerecession levels.” In the meantime, the good news is that associate compensation is up. 

“The average base salary for midlevel associates this year was the highest in five years and represented a 4 percent increase, from $178,164 last year to $185,319 this year. The average year-end bonus was $19,746, up 5 percent from last year’s average of $18,774.”

Read it at The American Lawyer

Associate hiring 2012

August 23rd, 2011 by Altman Weil

“Some economists are predicting a double-dip recession, but law firms hiring associates for 2012, say they are planning to make the same number of job offers as they did for the 2011 class — and in some cases may even increase the number of positions.  While they are mindful of the fragile economy, firms are not expecting the kind of upheaval that forced them to gut their summer associate classes in the last recession”  according to Thomson Reuters. 

“There are a few reasons firms are confident about the hiring landscape. One is the lessons of the 2008 recession are still fresh. The severity and speed of the recession caught most firms by surprise, and many found that they had over-hired. That experience has led to more careful and leaner staffing. Firms also work more closely than before with practice groups firm-wide when assessing manpower needs. ”

Read it at Thomson Reuters News & Insight

Law firm leaders are confident in face of changing marketplace

May 25th, 2011 by Altman Weil

The newly released Altman Weil Law Firms in Transition Survey 2011 finds confidence high among US law firm leaders in firms of all sizes.

Overall economic performance is rebounding, with two thirds of all firms surveyed reporting increases in gross revenue in 2010 and nearly three quarters reporting increases in revenue per lawyer and profits per equity partner.  Standard hourly billing rates are up significantly this year, with firms reporting or planning a median 4.0% increase in billing rates for 2011.  Continued reductions in overhead costs and the strategic shrinking of firms’ ownership ranks are contributing to profitability.

“If firms are finding their feet again post-recession, it is on new ground with a number of new factors in play,” said Altman Weil principal Tom Clay.  “And although most firm leaders seem to recognize the changes, it’s not yet clear whether they will be able to manage them effectively.”

Following are some selected highlights:

  • 67% of law firms reported an increase in gross revenue in 2010; revenue per lawyer was up in 73% of all firms; and profits per equity partner rose in 73% of firms.
  • Overhead costs were down in 53% of firms in 2010.
  • The amount of non-hourly billing in 2010, measured as a percentage of revenue, increased in 58% of all firms and in 81% of firms with 250 or more lawyers. 
  • Only 12% of firms report that alternative fee arrangements are more profitable than hourly billing. 
  • 27% of law firms de-equitized partners in 2010 and 16% will do so in 2011.  32% of firms made fewer partnership offers in 2010 and 18% will do so in 2011.  Larger firms are more likely to take these actions than smaller firms.  
  • 92% of all law firms plan to acquire laterals partners in 2011. 
  • 87% of law firms are planning to add associates to their ranks in 2011.   Only 18% of firms plan to remove associates this year, down from 42% in 2010.  
  • Only 18% of those surveyed think that reduced associate salaries will be a permanent trend, down from 32% who thought that last year.
  • 60% of firm leaders expect that the increased use of contract lawyers will be a permanent trend, up from 52% last year.
  • 41% of all firms believe that outsourcing legal work will be a permanent part of the new legal market. 
  • 47% of all firms are concerned that they are not prepared to deal with the retirement and succession of Baby Boom lawyers – the top concern identified.
  • 94% of law firms believe that the focus on practice efficiency is a permanent change in the profession - the number one trend identified.
  • Other top trends include more price competition (90%), fewer support staff (88%), more commoditized legal work (81%), more non-hourly billing (75%), and fewer equity partners (68%).
  • Only 16% of firm leaders expect permanently lower profits per partner.   
  • Leaders score their confidence as an “8” on a zero to ten scale when asked about their firms’ ability to keep pace with change.

Conducted in April and May 2011, the survey polled Managing Partners and Chairs at 805 US law firms with 50 or more lawyers.  Completed surveys were received from 240 firms (30%), including 38% of the 250 largest US law firms.

The full survey is available online to download at: www.altmanweil.com/LFiT2011.

Merit pay for associates - or not

May 17th, 2011 by Altman Weil

Leigh Jones at Reuters has written an in-depth story on the fate of merit pay for associates.  Among the stumbling blocks firms have encountered are inertia, administrative hassles, a potentially negative impact on recruitment and morale, as well as the basic bottom-line issue - no real savings have been realized.

“Back in 2009, a small group of major law firms announced that they were abandoning “lockstep pay” for associates in favor of merit-based salaries and bonuses. Out went the traditional practice of paying junior lawyers simply based on the year that they started. Into its place came evaluations by supervising partners who rated such factors as professional and interpersonal skills and client services.

DLA Piper and Orrick, Herrington & Sutcliffe were among the converts. So was Wilmer Cutler Pickering and Hale and Dorr. The firms argued that the new system would increase efficiency and allow them to more accurately reward the best associates. They also expected the move would appeal to clients concerned they were footing the bill for associates’ bonus pay, which typically is pegged to hours charged to clients. Given the history of law firms’ copycat behavior, lawyers believed that many other firms would follow suit.  So far, it hasn’t happened.”

Read it at Thomson Reuters News & Insight