Law Firms Confront Issue of Underutilized Partners; 15 Percent Plan Cuts in Early 2013
A survey of 115 mostly large law firms has found partner billable hours are on the decline, and some lawyers will find themselves without employment as a result.
Fifteen percent of the firms surveyed by Wells Fargo Private Bank plan to cut partners in the first quarter of 2013, Reuters reports. The number is higher than the usual 5 percent typically reflected in the survey, but lower than recession highs of about 25 percent.
Jeff Grossman, national managing director for Wells Fargo’s legal specialty group, told Reuters that the issue of underutilized partners is “one of the biggest challenges the industry is facing.”
Equity partners are projected to bill an average of 1,602 hours this year, a drop of 1.7 percent from last year, while nonequity partners are projected to bill 1,530 hours, a drop of 1.6 percent, according to Am Law Daily coverage of the report.
Partners are faring better, however, at a dozen top-tier firms—those with profits per equity partner of $2 million or above, the Am Law Daily says. At these firms, equity and nonequity partners are both projected to bill more than 1,700 hours.