2014 Biglaw Bonus Thread

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Bonuses will be _____ from last year

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Unchanged
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6%
 
Total votes: 102

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A. Nony Mouse
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Re: 2014 Biglaw Bonus Thread

Postby A. Nony Mouse » Fri Dec 12, 2014 12:13 am

Cobretti wrote:Sorry, fixed. The point is there are people who are in a position to realistically change base compensation that are aware of the market conditions of their pool of applicants, and will consider it because it would be irrational not to.

It might be rational to consider tuition, but why would it be rational to increase salaries because of tuition raises? Law firms don't care about law students' economic interests. And it's not like there are higher-paying jobs that law students will start going after instead of biglaw as tuition continues to go up. Biglaw jobs are still the highest-paying jobs out there for law students, generally speaking.

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Cobretti
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Re: 2014 Biglaw Bonus Thread

Postby Cobretti » Fri Dec 12, 2014 12:26 am

A. Nony Mouse wrote:
Cobretti wrote:Sorry, fixed. The point is there are people who are in a position to realistically change base compensation that are aware of the market conditions of their pool of applicants, and will consider it because it would be irrational not to.

It might be rational to consider tuition, but why would it be rational to increase salaries because of tuition raises? Law firms don't care about law students' economic interests. And it's not like there are higher-paying jobs that law students will start going after instead of biglaw as tuition continues to go up. Biglaw jobs are still the highest-paying jobs out there for law students, generally speaking.

I've been arguing that they would consider tuition when determining how much to raise when they do. I'm sure it would be a factor generally as well but I never said it would be sufficient to raise base salary. We got on this topic after of all the other arguments for why they would raise comp, and started talking about how much they would raise.

And of course they care about their economic interests, that is how they attract people to the profession. The long term recruitment strategy would be to attract people to law school in the first place, not to biglaw after they've decided on law school. Biglaw has already sufficiently beaten out most potentially competitive JD employers by paying significantly more.

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A. Nony Mouse
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Re: 2014 Biglaw Bonus Thread

Postby A. Nony Mouse » Fri Dec 12, 2014 12:30 am

But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

Mal Reynolds
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Re: 2014 Biglaw Bonus Thread

Postby Mal Reynolds » Fri Dec 12, 2014 12:32 am

A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?


Because he wants that to be a factor.

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Cobretti
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Re: 2014 Biglaw Bonus Thread

Postby Cobretti » Fri Dec 12, 2014 12:34 am

A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.

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sublime
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Re: 2014 Biglaw Bonus Thread

Postby sublime » Fri Dec 12, 2014 12:36 am

..

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Calvin Murphy
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Re: 2014 Biglaw Bonus Thread

Postby Calvin Murphy » Fri Dec 12, 2014 12:38 am

sublime wrote:
Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.



Is there anybody who would go for law school if biglaw started at 175 instead of 160?


I was doing research before applying and noticed that my secondary market paid $120-130k, and wasn't going to go. Once I realized that the firms in real cities pay $160 I applied to every school within a 200 mile radius before you could say NYC to 190!

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sublime
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Re: 2014 Biglaw Bonus Thread

Postby sublime » Fri Dec 12, 2014 12:40 am

..

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Cobretti
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Re: 2014 Biglaw Bonus Thread

Postby Cobretti » Fri Dec 12, 2014 12:40 am

sublime wrote:
Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.



Is there anybody who would go for law school if biglaw started at 175 instead of 160?

Is there anyone that would buy an xbox that otherwise wouldn't if it cost 275 instead of 300?

yes

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A. Nony Mouse
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Re: 2014 Biglaw Bonus Thread

Postby A. Nony Mouse » Fri Dec 12, 2014 12:41 am

Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.

seriously, what evidence do you have for this? why do firms need "better" people and what makes them better?

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sublime
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Re: 2014 Biglaw Bonus Thread

Postby sublime » Fri Dec 12, 2014 12:41 am

..

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Cobretti
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Re: 2014 Biglaw Bonus Thread

Postby Cobretti » Fri Dec 12, 2014 12:48 am

A. Nony Mouse wrote:
Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.

seriously, what evidence do you have for this? why do firms need "better" people and what makes them better?

Literally every firm i did callbacks with had interviewers lauding how smart their colleagues were and it was the most brilliant group of people they had ever worked with. Also, generally speaking, every employer wants the smartest people they can get.
sublime wrote:LSAT scores, obvi.

I'm not saying anything specifically about the LSAT, I'm saying generally if biglaw becomes less attractive to undergrads that are smart enough to be deciding between a number of very high paying professions, then the biglaw applicant pool will become less intelligent.

ETA: This just boils down to I am saying that compensation leading firms worry about the quality of the applicant pool and consider other industries a threat to their long term recruitment goals. If you don't think that they consider that then that's fine, but that's the only assumption that needs to be debated here.
Last edited by Cobretti on Fri Dec 12, 2014 12:50 am, edited 1 time in total.

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Desert Fox
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Re: 2014 Biglaw Bonus Thread

Postby Desert Fox » Fri Dec 12, 2014 12:49 am

I'd accept that not everyone can do biglaw and you need a certain caliber of people.

But the market setting firms aren't ever going to run out of them. Maybe Nixon Peabody will have to hire some waterbrains, but Cravath and Simpson won't have to.

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Desert Fox
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Re: 2014 Biglaw Bonus Thread

Postby Desert Fox » Fri Dec 12, 2014 12:58 am

sublime wrote:
Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.



Is there anybody who would go for law school if biglaw started at 175 instead of 160?


Up until this bonus season there was a real worry that biglaw salaries would just continue to erode away from inflation. Hell, I still don't believe we'll see a payscale raise. And if we did, I think it would be limited to NYC and maybe Texas.

In real dollars, biglaw total comp is worse than it's been in 20 years. In nominal dollars it's at pre-2005.

I absolutely wouldn't go to law school if biglaw was going to stay at 2013 total nominal compensation forever. But if compensation is going to rise with inflation, its a somewhat better bet.

That said, no way firms think about this.

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sublime
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Re: 2014 Biglaw Bonus Thread

Postby sublime » Fri Dec 12, 2014 1:01 am

..

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A. Nony Mouse
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Re: 2014 Biglaw Bonus Thread

Postby A. Nony Mouse » Fri Dec 12, 2014 1:03 am

Cobretti wrote:Literally every firm i did callbacks with had interviewers lauding how smart their colleagues were and it was the most brilliant group of people they had ever worked with. Also, generally speaking, every employer wants the smartest people they can get.
sublime wrote:LSAT scores, obvi.

I'm not saying anything specifically about the LSAT, I'm saying generally if biglaw becomes less attractive to undergrads that are smart enough to be deciding between a number of very high paying professions, then the biglaw applicant pool will become less intelligent.

ETA: This just boils down to I am saying that compensation leading firms worry about the quality of the applicant pool and consider other industries a threat to their long term recruitment goals. If you don't think that they consider that then that's fine, but that's the only assumption that needs to be debated here.

I can believe firms worry about getting smart people, I totally don't believe they see tuition as connected to that in any way, or believe that their salaries need to take tuition into account to get that pool of smart people. It's not like tuition for degrees required for other high-paying professions is going down.

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sinfiery
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Re: 2014 Biglaw Bonus Thread

Postby sinfiery » Fri Dec 12, 2014 1:46 am

A. Nony Mouse wrote:seriously, what evidence do you have for this? why do firms need "better" people and what makes them better?


Why risk their 3m PPP when they can sacrifice 1% of it to combat any threat of change to the status quo that feeds them?


it's not so much "better" as it is "different"
seems pretty simple

NycReturn
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Re: 2014 Biglaw Bonus Thread

Postby NycReturn » Fri Dec 12, 2014 2:01 am

Cobretti wrote:
A. Nony Mouse wrote:
Cobretti wrote:
A. Nony Mouse wrote:But there are already way more people wanting to do biglaw than there are biglaw jobs. There are way more law students generally than there are jobs. Why do big firms have to worry about attracting more people to law school?

they worry about attracting "better" people to law school.

seriously, what evidence do you have for this? why do firms need "better" people and what makes them better?

Literally every firm i did callbacks with had interviewers lauding how smart their colleagues were and it was the most brilliant group of people they had ever worked with. Also, generally speaking, every employer wants the smartest people they can get.
sublime wrote:LSAT scores, obvi.

I'm not saying anything specifically about the LSAT, I'm saying generally if biglaw becomes less attractive to undergrads that are smart enough to be deciding between a number of very high paying professions, then the biglaw applicant pool will become less intelligent.

ETA: This just boils down to I am saying that compensation leading firms worry about the quality of the applicant pool and consider other industries a threat to their long term recruitment goals. If you don't think that they consider that then that's fine, but that's the only assumption that needs to be debated here.


It's a stretch to say that the quality of the 'applicant pool' would be affected by $160K vs $175K when weighing whether it could pay off law school debt. Most applicants looking this far ahead look to the binomial distribution of legal salaries, and their chances of getting that biglaw job vs the other outcomes.

And anyway, where else are biglaw clients going to go for legal services if the applicant pool to law school was hypothetically diminished? Unless I'm overlooking how versatile the JD is and how that translates to law firms being versatile professional service firms that do many non-legal services for clients, then the demand for law firm services isn't going to change based upon the applicant pool.

(And yes I recognize that if all of a sudden lawyers can no longer read, clients won't go to them for anything, but that's not going to happen)

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KD35
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Re: 2014 Biglaw Bonus Thread

Postby KD35 » Fri Dec 12, 2014 2:14 am

NycReturn wrote:It's a stretch to say that the quality of the 'applicant pool' would be affected by $160K vs $175K when weighing whether it could pay off law school debt. Most applicants looking this far ahead look to the binomial distribution of legal salaries, and their chances of getting that biglaw job vs the other outcomes.


I do think there would be an impact because it looks bad if the starting income has not increased in years, even if the increase was minor. It just does not look good if the economy is (facially) doing better but starting salaries have not increased to reflect that.

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Re: 2014 Biglaw Bonus Thread

Postby jbagelboy » Fri Dec 12, 2014 2:20 am

more than the actual numbers, the notion that salaries are not stagnant and that there's room for growth in compensation could impact people's decision in going to law school. If you're a financial analyst, a mid-tier strategy consultant, at a marketing company or coming off a decent MA degree, in 2010-2012 you probably considered law school and decided to put it off or look the other way if you were paying attention and did your homework. Three years later, if we see bonuses and then base salaries going up, I actually do think that momentum could impact ex ante decision making in the aggregate for some people in the work force and even college seniors debating career choices.

I hate to think of choosing a graduate program or career based so derivatively on income, but it's undeniably a factor; more pertinently, it's also what salary increases represent: opportunity, demand, ect. So I do think there's at least an indirect incentive for firms to adjust compensation to draw people into law school.

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Re: 2014 Biglaw Bonus Thread

Postby BigZuck » Fri Dec 12, 2014 2:20 am

Desert Fox wrote:Up until this bonus season there was a real worry that biglaw salaries would just continue to erode away from inflation. Hell, I still don't believe we'll see a payscale raise. And if we did, I think it would be limited to NYC and maybe Texas.


Kind of tangential, but DF, why do you think it might rise in Texas but not, say, DC or Chicago or LA? Is it just based on the Texas market being "hot" or whatever? To me the flip side is that COL is so low compared to other markets there is no reason to raise it because associates are already doing better money-wise but you guys know way more about this stuff than I do.

Not trying to argue, just curious what made you say/think that?

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jbagelboy
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Re: 2014 Biglaw Bonus Thread

Postby jbagelboy » Fri Dec 12, 2014 2:22 am

BigZuck wrote:
Desert Fox wrote:Up until this bonus season there was a real worry that biglaw salaries would just continue to erode away from inflation. Hell, I still don't believe we'll see a payscale raise. And if we did, I think it would be limited to NYC and maybe Texas.


Kind of tangential, but DF, why do you think it might rise in Texas but not, say, DC or Chicago or LA? Is it just based on the Texas market being "hot" or whatever? To me the flip side is that COL is so low compared to other markets there is no reason to raise it because associates are already doing better money-wise but you guys know way more about this stuff than I do.

Not trying to argue, just curious what made you say/think that?


there's no way competitive firms in LA (Irell, MTO, GDC) would let the ball drop on compensation relative to New York. They draw too heavily from the same applicant pools.

NycReturn
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Re: 2014 Biglaw Bonus Thread

Postby NycReturn » Fri Dec 12, 2014 2:40 am

KD35 wrote:
NycReturn wrote:It's a stretch to say that the quality of the 'applicant pool' would be affected by $160K vs $175K when weighing whether it could pay off law school debt. Most applicants looking this far ahead look to the binomial distribution of legal salaries, and their chances of getting that biglaw job vs the other outcomes.


I do think there would be an impact because it looks bad if the starting income has not increased in years, even if the increase was minor. It just does not look good if the economy is (facially) doing better but starting salaries have not increased to reflect that.


NycReturn wrote:And anyway, where else are biglaw clients going to go for legal services if the applicant pool to law school was hypothetically diminished? Unless I'm overlooking how versatile the JD is and how that translates to law firms being versatile professional service firms that do many non-legal services for clients, then the demand for law firm services isn't going to change based upon the applicant pool.

(And yes I recognize that if all of a sudden lawyers can no longer read, clients won't go to them for anything, but that's not going to happen)



There's really enough of an impact on the applicant pool to affect the demand for biglaw services? I think you're giving way too much credit to the value provided by the marginal difference in lawyer ability that would come from this difference in the applicant pool.

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Old Gregg
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Re: 2014 Biglaw Bonus Thread

Postby Old Gregg » Fri Dec 12, 2014 2:52 am

this thread has gone to shit

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Re: 2014 Biglaw Bonus Thread

Postby cookiejar1 » Fri Dec 12, 2014 3:02 am

zweitbester wrote:this thread has gone to shit

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