National Jurist - November 2012 - (Page 4)
The average starting salary for recent graduates dropped due primarily to changes at the biggest firms. Will it ever come back?
tarting salaries at the nation’s largStill, firms had been reluctant to back est firms, those with more than 700 away from their starting salaries, so it has attorneys, dropped this year from an been a slow erosion. Global law firms, average of $160,000 to $145,000, which once paid the same salary for all according to a study by the National office locations, now pay lower salaries in Association for Law Placement, the secondary markets. association for legal career profession“The prevalence of $160,000 is less als. The drop is a further sign that firms because they can get somebody for are grappling and adjusting to a new kind $145,000,” Leipold said. “If you are of market, and some feel the old legal mar- in Denver or Cleveland, $145,000 is ket will never come back. very competitive.” “The legal industry is going In 2009, 90 percent of law through exactly what so many firms with more than 700 Starting other industries have gone attorneys in Los Angeles salaries at the through,” said James Leipold, a n d Wa s h i n g t o n , nation’s largest firms NALP’s executive director. “Globalization and advancdropped this year es in technology are erodfrom $160,000 to ing jobs. Some jobs have $145,000 for law gone overseas; some are firms with 700 or better done by software and more attorneys computers. Even if the market picks up, that’s still not necessarily going to increase head count [at law firms].” Nationwide, 46 percent of law firms with more than 700 attorneys reported a $145,000 entry-level salary, down from 65 D.C., reported salaries at $160,000. percent of firms in 2009, the high water This year, only about two-thirds mark for salaries. Leipold said, in hind- did so. sight, the large salary increases from 2006 But even more concerning, the to 2009 occurred “too fast and too far.” number of associates hired by law firms with 500 or more attorneys dropped from 4,745 in 2007 to 2,856 in 2011 — a 40 percent drop since the start of “ the recession. “There is a long-term trend line showing a declining number of private practice jobs, and that is the economic engine that enables law schools to exist at current tuition levels,” wrote William Henderson, a professor of law at Indiana University Maurer School of Law-Bloomington, in his blog, The Legal Whiteboard. While referring to employment at the ” largest firms, Henderson said the changes — James Leipold, impact all law students. NALP’s executive director “A Harvard graduate: instead of working in New York City will take a job in Rochester, and that will displace a graduate of another law school,” he said. “We have huge overcapacity issues. We need those [large law firm] jobs to make the math work [in legal education], and it is a long trend line down.” But there is some good news. The overall median salary for entry-level attorneys increased from $115,000 to $125,000, according to NALP. This is due mainly to salaries at law firms with 251 to 700 attorneys, which increased from $125,000 to $145,000. “The middle of the market is where it has increased,” Leipold said. “At the beginning of the recession [those law firms] were in a better situation. They had a lower cost structure and could deliver at a better price point. They could increase their talent pool because there was a lot of top talent not getting jobs at the largest firms. So in some ways their market had competition, and Salaries that bumped up at law firms the salaries.” with 251 to Leipold said, 700 attorneys, despite the increased from i m p r ov e m e n t s , $125,000 to salaries are still $145,000. largely flat and should remain that way until there is a significant demand for legal services. But Henderson questions whether demand will ever return, arguing it is more of a long-term structural change in the marketplace. He said the chances would force law schools to get innovative in order to survive. “A law school dean can’t solve the problem for everyone, but he can solve it for the 300 graduates of his school,” he said. “A few industrious faculty members and administrators will get creative and solve this from the bottom up.” He said most law faculty, however, have not yet grasped the fact that the legal market has fundamentally changed.
Globalization and advances in technology are eroding jobs. Some jobs have gone overseas; some are better done by software and computers.
The NaTioNal JurisT
Table of Contents for the Digital Edition of National Jurist - November 2012
National Jurist - November 2012
Average starting salary drops at largest firms
Enrollment down at law schools
The good and the bad
Employment Insider: Best firms for quality of life and diversity
Book Excerpt: “Don’t Go to Law School (Unless)”
Best moot court programs
Villanova and Illinois: Moving past scandals
Schools with most librarians per student
Study Advice: How to prepare for exams
Most diverse law schools
Diversity under attack
Best law schools in the world
The American LL.M. advantage
Guide to LL.M. programs
Employment Advice: Writing convincing cover letters
National Jurist - November 2012