Law Firms

Law Firms Express ‘Growing Enthusiasm’ for Contract Lawyers

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There isn’t much good news for associates in a new survey of leaders of law firms with more than 50 lawyers.

Forty-four percent of the firms laid off associates last year, 53 percent reduced or discontinued hiring first-year associates, and 64 percent shrunk their summer associate programs, according to the Altman Weil survey (PDF).

This year, 10 percent of the firms plan to cut associates, 38 percent plan to reduce or discontinue hiring first-year associates, and 54 percent plan to shrink their summer programs.

At the same time, law firms are instead expressing a “growing enthusiasm” for a staffing alternative—contract lawyers, according to an Altman Weil press release. Last year, 39 percent of the law firms used contract lawyers. This year, 53 percent will or might do so, while 52 percent expect that contract lawyers will become a permanent part of their staffing plans.

Firms are less enthusiastic about outsourcing or “offshoring” their legal work, according to Altman Weil principal Tom Clay. Fewer than 10 percent reported using either alternative. “Despite the potential for cost savings, law firms remain highly skeptical of outsourcing and offshoring and will likely only adopt them when pushed by clients to do so,” Clay said in the press release.

Meanwhile the news is also bad for associates hoping to make partner. Nearly 40 percent of the firms made fewer partnership offers last year, and 50 percent say they will or might make fewer offers this year. In the press release, Clay says firms are managing the number of partners they admit with the goal of maintaining their profits per partner.

Firms are also cutting partners. Last year, 25 percent cut equity partners, 26 percent cut nonequity partners and 27 percent de-equitized partners. Support staff, however, suffered the most; 67 percent of the firms cut support staff, while 43 percent cut paralegals.

The survey, conducted in April and May, polled managing partners and chairs of 787 law firms with 50 or more lawyers. Surveys were returned by 218 firms, including 38 percent of the nation’s 250 largest law firms.

Related coverage:

Survey Warns of Pending Partner Bloodbath: Over 33% of Responding Law Firms May De-equitize

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