Law Firms

New data shows lateral associate hiring happening across the board

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Lateral hiring for associates increased in nearly all practice groups in the first quarter of 2021, with data privacy, entertainment and media and insurance practices showing the most activity, according to a legal data company.

Data released Tuesday by Decipher, which tracked lateral associate moves in the first quarter of 2021 and each of the four years prior, shows that data privacy associates had a move rate that was 167% higher than the previous four-year average. Entertainment and media associates had a move rate that was up 156% over the previous four-year average, while insurance associates had a move rate that was up 111% during the same period.

Other “bedrock” practices also showed increases in the first quarter of 2021, Decipher said. Corporate associate moves were up by 57%, while litigation associate and labor and employment associate moves were up by 46% and 26%, respectively.

Decipher pointed out that only government relations showed a decline in lateral associate moves.

The legal data company also analyzed which geographic regions had the most active lateral associate markets, noting that young lawyers in California were the country’s “top flight risks.” San Diego’s first-quarter moves were up 34% over the previous four-year average. Orange County came in second, with its moves up 20%, and Los Angeles came in third, with its moves up 15%.

Other markets, such as Atlanta and Chicago, saw smaller gains in associate movement, Decipher said. Atlanta experienced an 8% increase in first-quarter moves, while Chicago saw a 3% increase.

The increased movement by lateral associates so far in 2021 sharply contrasts with 2020, when the hiring of this group decreased by 33.3% from the previous year, according to data released by the National Association for Law Placement released earlier this month.

“The competition for young talent has inspired law firms to get more aggressive,” said Decipher, which pointed to Kirkland & Ellis as one firm that has provided quicker paths to partnership and signing bonuses of up to $150,000 to associates.

Decipher cautioned that when law firms race to hire associates, they may end up forgoing necessary due diligence on their new hires. While mistakes in hiring could harm a firm’s revenue and reputation, the company said conditions in 2021—such as less supervision during remote working—could make the quick hiring of associates even riskier.

“It’s imperative that law firms avoid getting caught up in the chaos,” Decipher said. “Slow down, and take the time to know who you are hiring.”

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