Tracking graduate hiring numbers and summer classes at law firms since 2009
BigLaw junior level recruiting is up in 2015 compared to 2014 | First-year intakes are up 5% on average | Summer associate numbers are up 8.3% on average | The gap widens between the strong recruiters and the weaker ones.
Summer associate opportunities in BigLaw are increasing
June 26, 2015: THE doom-mongers might tell us that BigLaw jobs are under threat from outsourcing, automation, or mass bankrupcies, but entry-level recruiting is looking buoyant. This reflects America’s improving economic health, which enjoyed a fall in unemployment to 5.4% in April. Legal career publication Chambers Associate has surveyed over 80 top law firms on their junior-level recruiting figures over the past six years...
So who are the comeback kids in this year's crop of class size results?
Let’s start with the biggest firms, some of which are enjoying dramatic recoveries in their entry-level hiring. Skadden is taking on a whopping 186 junior associates this year, a 25% jump on 2014.
Jones Day also saw a boost, with a bumper class of 129 juniors – a 28% increase on last year. Davis Polk, meanwhile, has managed the impressive feat of beating its pre-recession figures thanks to a newly booming corporate M&A market. It boasts a 112-strong class for 2015, compared to 93 juniors in 2009.
On the other hand, Latham & Watkins – despite its Am Law-topping financials in 2014 – is one of several big law firms whose entry-level class has fallen this year (by just under 22% in Latham's case). This reflects in part reduced summer associate class sizes a couple of years back, as firms approached hiring tentatively following the Great Recession. Latham's 2015 summer class, by contrast, is up 12.3% on last year to 182.
There are plenty of success stories amongst midsized firms too.
With a newly invigorated construction market, Schiff Hardin has responded with an intake of 20 – a new high for the firm since we started surveying it in 2009. Waller and Dykema have also seen their 2015 classes double in size, from five to ten and eight to 16 respectively. Localized issues – in Dykema's case, the resurgence of Detroit following the city exiting its bankruptcy – affect the recruiting needs of regional law firms as much as the macro economic landscape.
A recovery for some…
Howrey, Dewey, Bingham… some firms have crashed and burned, or simply failed to get back their mojo and sought a merger to survive. “We’re seeing more differentiation between firms,” says NALP's Jim Leipold.“Some have had negative year-end financial results. Others have been quite positive. This differentiation in the market is reflected in the fact that almost as many firms increased the number of summer program offers as decreased them.”
Our figures confirm this. 39% of firms decreased their junior intake class relative to 2014. And if you track the past six years, the 20 biggest recruiters dropped hiring by an average of 8%, while the smaller 20 recruiters dropped their intake by 20%. So the strong have got stronger.
With continuing low oil prices, we’re seeing conservative hiring from some Texas firms like Bracewell & Guiliani and Jackson Walker. For other firms, a substantial drop in junior associate numbers represents a shift in their market position – for example, Irell & Manella has been taking stock after 30-odd attorneys left to start a boutique firm.
Law firms are adjusting to a “new normal”
The graph above doesn't show the kind of bullish recovery in hiring that JD dreams are made of. Indeed, the firms that have bettered their pre-recession recruiting levels are a privileged minority.
Legal industry forecasters often speak of a 'new normal' following the recession. Bobby Weiss, director of recruiting at Waller, tells us that “we haven't returned to the way things were because we've learned enough through the recession not to be overly confident in our projections and to apply what we learned. There's certainly a new normal, and we need to approach our hiring based on gaps that arise in our associate ranks. Trying to forecast that is difficult but very necessary.”
Steeper 8.3% rise in summer program sizes suggest hope for future classes
Summer program numbers act as a barometer for these future years, since they amass the pool of students that firms will recruit from in one or two years' time. As the graph shows, they respond more swiftly and dramatically to changes in the economy: a steep dip in 2010 summer program numbers followed the global economic crash, where junior associate intake numbers bottomed out more gradually in 2012-14.
Whereas entry-level class sizes among the law firms we surveyed rose by 5% from 2014 to 2015, the 8.3% rise in summer program size suggests an optimistic mood. And as NALP's surveys have shown, recent law school graduating classes have been shrinking. New law school grads are part of a smaller cohort, and though they are nowadays fully primed for the tough jobs market ahead, applicants to BigLaw can take some comfort that summer associate opportunities are, broadly speaking, increasing.
June 2015