Is Biglaw in Trouble? ...Overcapacity?

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jtabustos
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Is Biglaw in Trouble? ...Overcapacity?

Postby jtabustos » Tue Jul 09, 2013 1:04 pm

At this point, anyone (with the exception of equity partners who are in firm management or control business in an amount at least 10 percent more than their firm’s reported profits-per-partner figure) who thinks they are immune from a painful compensation haircut or an outright layoff is naive. There is a consensus that Biglaw is overstuffed with lawyers — to the tune of 10 percent or more, according to Bruce MacEwen — and both central management and the Biglaw consultants who advise them are agitating for action by more firms. Add in an elite firm like Weil paving the way, plus plenty of recent examples of firm failures as cautionary tales, and you have a recipe for Biglaw instability that is arguably more widespread than the troubles in 2008-2009. What I mean is that a wider cross-section of Biglaw lawyers, of all experience levels, are at some form of risk for “action” by Biglaw’s overlords. And with the transfer of power from Biglaw partnerships to centralized management, there is less of a check on such actions being taken, with little to no notice to affected parties.

http://abovethelaw.com/2013/07/risky-bu ... in-biglaw/

Saw this article on biglaw's overcapacity at a site called, Above The Law (written by a biglaw partner I think).

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A-Modest-Proposal
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Re: Is Biglaw in Trouble? ...Overcapacity?

Postby A-Modest-Proposal » Tue Jul 09, 2013 10:20 pm

jtabustos wrote:At this point, anyone (with the exception of equity partners who are in firm management or control business in an amount at least 10 percent more than their firm’s reported profits-per-partner figure) who thinks they are immune from a painful compensation haircut or an outright layoff is naive. There is a consensus that Biglaw is overstuffed with lawyers — to the tune of 10 percent or more, according to Bruce MacEwen — and both central management and the Biglaw consultants who advise them are agitating for action by more firms. Add in an elite firm like Weil paving the way, plus plenty of recent examples of firm failures as cautionary tales, and you have a recipe for Biglaw instability that is arguably more widespread than the troubles in 2008-2009. What I mean is that a wider cross-section of Biglaw lawyers, of all experience levels, are at some form of risk for “action” by Biglaw’s overlords. And with the transfer of power from Biglaw partnerships to centralized management, there is less of a check on such actions being taken, with little to no notice to affected parties.

http://abovethelaw.com/2013/07/risky-bu ... in-biglaw/

Saw this article on biglaw's overcapacity at a site called, Above The Law (written by a biglaw partner I think).


Yeah Above the Law is a good (and often funny) source of up-to-date legal world happenings.

With that said, the recent Weil layoffs have left an air of unease around the Biglaw world. Associates at the bottom rung are quaking to see whether or not more cuts will come - the absolute slaughter of layoffs during the Great Recession are fresh in everyone's mind.

At least with Weil, according to another ATL article, they at least are providing I believe 6 months of severance pay and they actually announced to the world that they were laying people off. I know the latter almost seems like a given, but just as this article mentions, stealth layoffs are really concerning to the legal community and prospective Associates, because this leaves a large area of uncertainty within the future market.

Now it might now be all doom in gloom. Looking more closely at the Weil layoffs, many are contributing the layoffs at that firm to the closing of the Lehman Brothers saga (Weil handles many bankruptcy, and obviously taking on a job like liquidating LB would take more associates than on average). So it's unclear whether or not these layoffs are indicative of a future purging. But we also cannot be sure that the current BigLaw firms will be content on receiving smaller profit margins in exchange for more associates.

Moral of the story, we have to be patient and watch how the summer and fall unfold.

PRgradBYU
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Re: Is Biglaw in Trouble? ...Overcapacity?

Postby PRgradBYU » Wed Jul 10, 2013 12:47 am

jtabustos wrote:At this point, anyone (with the exception of equity partners who are in firm management or control business in an amount at least 10 percent more than their firm’s reported profits-per-partner figure) who thinks they are immune from a painful compensation haircut or an outright layoff is naive. There is a consensus that Biglaw is overstuffed with lawyers — to the tune of 10 percent or more, according to Bruce MacEwen — and both central management and the Biglaw consultants who advise them are agitating for action by more firms. Add in an elite firm like Weil paving the way, plus plenty of recent examples of firm failures as cautionary tales, and you have a recipe for Biglaw instability that is arguably more widespread than the troubles in 2008-2009. What I mean is that a wider cross-section of Biglaw lawyers, of all experience levels, are at some form of risk for “action” by Biglaw’s overlords. And with the transfer of power from Biglaw partnerships to centralized management, there is less of a check on such actions being taken, with little to no notice to affected parties.

http://abovethelaw.com/2013/07/risky-bu ... in-biglaw/

Saw this article on biglaw's overcapacity at a site called, Above The Law (written by a biglaw partner I think).


No offense to you personally, but I'm sick of seeing Above the Law articles rehashed on TLS every day. For the sake of everyone here, just assume we're all up to date on ATL. HTH.




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