August 01, 2007
Annual Survey Shows the New Reality of Associate Life
Four facts -- from too few lawyers to too many sent packing -- set the stage for the latest war for talent
The American Lawyer
August 1, 2007
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Put aside the conventional wisdom. Here's the state of associate life.
-Associates aren't miserable, except perhaps in certain high-pressure New York precincts. The average satisfaction score hit a record high this year: 3.81 on a five-point scale.
- Associates don't plan on staying. Despite the high level of job satisfaction, only 44.9 percent of the respondents predicted that they would be at their firms in five years, and only 11.7 percent expected that they would become equity partners at their current firm.
- Despite all the hand-wringing over associate retention, law firms report that in nearly half the associate departures -- 49 percent -- the firms were either neutral about the departures or happy to have the associates leave. (This statistic comes from the latest survey by the National Association for Law Placement.)
- There may not be enough lawyers to feed the hiring appetite. According to our survey of summer associate hires, Am Law 200 firms expect to bring on roughly 10,000 associates next fall. That astonishing number equals about one-quarter of all the students who will graduate from U.S. law schools next year. To put it another way, the top 20 law schools will only produce about 6,500 graduates.
What do these four facts mean? For law firms, at least three things. First, in the short run, the war for talent will become more ferocious. Second, the cost of talent will only increase. And third, the need for firms to differentiate themselves will become apparent even to the hidebound.
This year's famous hike to $160,000 in starting pay for first-year associates did not buy hiring firms anything in terms of separating themselves from their competition. The firms that can afford to pay more will pay more; but there is a price point that not all Am Law 200 firms will be willing to match. We're confident that that number begins with a 2.
As costs rise, the price of a mistake only grows. The feverish but unsystematic, even casual, recruiting habits of firms seem painfully inadequate now. Firms will sharpen their techniques or start losing ground to others who have grown weary of viewing recruits through a glass darkly.
As we have argued before, firms are not all alike and do themselves and their potential associates little good by pretending otherwise. Firms need to define themselves and then make their distinctive qualities known to the job market.
A word for potential associates: Enjoy! The seller's market will last until the next downturn -- by which time most of you will be on to something else.
Posted by hafeezt at August 1, 2007 11:43 AM