pjo wrote:I'm not sure how you could read that article and think what happened at Howrey or Dewey is indicative of the entire Biglaw market. They both had different reasons for failing, and not all big firms follow that same model (especially not after both firms' failures). Howrey was really unique in that the firm gave Ruyak a ton of authority to make executive decisions, and, although I'm sure he was a great lawyer and rainmaker, he was absolutely horrible at making decisions as a CEO/Managing Partner. He drove the firm to expand into geographic areas for the sole purpose so that the firm could put on their letterhead that they had an office in the location. Ruyak's ego and eagerness for Howrey to be considered a premier firm drove his decisions; not any business metrics. Most firms split their CEO/Global Managing Partner from their legal side. It's just a bad idea to let your best rainmaker also be your CEO/MP. Let the rainmakers generate and maintain clients; hire a competent CEO/business person to run the firm and make growth decisions. Most firms do this (at least now).
Dewey was totally different. Dewey's collapse was a result of guaranteed payments to lateral partners. Firm profits dropped, but the firm still owed huge amounts to lateral partners. Therefore their liabilities exceeded their profits. When partners realized the firm was in trouble they just jumped ship, which created a death spiral. But seriously, Dewey shouldn't have expected any loyalty because the only reason most of their rainmakers came on board was because they were able to poach them from other firms by offering big dollar guaranteed money. Although the lateral market is still really hot right now, firms are also aware of this and it's my understanding that few if any firms are still guaranteeing payments to laterals (other than a one time signing bonus).
The only thing this article really nails on the head is the fact that law school tuition keeps rising but your chances of getting a high paying big law position is decreasing. This really isn't anything new. This also doesn't really have any bearing on big law firms, and if anything, the fact that most firms are taking smaller summer classes means that they are leaner and financially stronger. They're finding ways to get the same amount of work done with fewer associates. The article also fails to realize that although this new trend of smaller big law classes is bad for the majority of graduates, it's actually really beneficial for those who do land big law jobs. Although still not great, your chances of making partner (or sticking around for longer) are much better in a class of say 20 new associates as compared to a class of 50. Your exit options will also be better because there are fewer people in the market with big law on their resume.
I have not heard anyone on this site say they think their chances of getting big law is getting smaller. Everyone calculates based on the last classes data. Yesterday someone posted a link to an NALP report that pretty much said hiring was flat at best- as evidence that big law was improving.
The rest of the last paragraph just makes things up. Ex: they aren't simply finding ways to get more work out of associates, there is still less work. Ex: made up idea about how making partner will be easier.