2014 was gangbusters all around...NYC to 190k? Forum

[dixiecupdrinking]

lol at the idea of anyone choosing not to work in biglaw because the salary isn't high enough. Where's the incentive to raise it? that's the bottom line here.

[Old Gregg]

lol at the idea of anyone choosing not to work in biglaw because the salary isn't high enough. Where's the incentive to raise it? that's the bottom line here.

no one cares about attracting juniors. that's easy (esp after ITE).

but retaining midlevels and seniors? esp good ones? difficult. and it's funny because i sit in retention strategy meetings all the time, and we talk about all the cool morale shit we can do... let's do a PANEL ON WORK LIFE BALANCE or let's have HAPPY HOUR!! Nope. People just want more money.

but no, seriously, the panels are great. especially if i cant attend because partner wants me to get X or Y out ASAP. but the leftover food is still not quite too cold to be eaten.

[dixiecupdrinking]

lol at the idea of anyone choosing not to work in biglaw because the salary isn't high enough. Where's the incentive to raise it? that's the bottom line here.

no one cares about attracting juniors. that's easy (esp after ITE).

but retaining midlevels and seniors? esp good ones? difficult. and it's funny because i sit in retention strategy meetings all the time, and we talk about all the cool morale shit we can do... let's do a PANEL ON WORK LIFE BALANCE or let's have HAPPY HOUR!! Nope. People just want more money.

right so raise midlevel salaries. but "NYC TO 190" or even 180 or 170 is simply not happening.

Also yeah the other stuff is all bs. You mean I can attend some panel discussion or lame happy hour and work an extra two hours tonight? Great

[Old Gregg]

right so raise midlevel salaries. but "NYC TO 190" or even 180 or 170 is simply not happening.

i can see it happening. but we do need at least one more year of crazy good economic activity. and frankly we're overdue for another recession, so yes probably more layoffs before we get any salary increases.

[A. Nony Mouse]

Poopface is talking about attracting people to law school in the first place, not getting law studeents to want to do biglaw. The fact that attracting people to the profession might not create a crisis "for a while" doesn't mean it isn't a significant part of the long term strategy at firms (some of which are over 100 years old to put in perspective).

I don't think it is part of the consideration at all. It is too attenuated.

Its too attenuated for a 190 year old firm to have a recruiting horizon of > 3 years?

The hivemind keeps fighting me on this issue every time it comes up and it blows my mind.

What blows my mind is that every time this comes up I haven't seen you provide any evidence for it beyond "it makes sense to me that it would work this way." I mean, there are still tons of people going to top law schools. What do biglaw firms have to worry about? They're filling their classes. Why on earth would they need to recruit people to go to law school - and even if they did, again, is salary really the issue? Is there any meaningfully-sized group of people who would turn down biglaw at $160k but bite at $175k or $190?

[seespotrun]

lol at the idea of anyone choosing not to work in biglaw because the salary isn't high enough. Where's the incentive to raise it? that's the bottom line here.

no one cares about attracting juniors. that's easy (esp after ITE).

but retaining midlevels and seniors? esp good ones? difficult. and it's funny because i sit in retention strategy meetings all the time, and we talk about all the cool morale shit we can do... let's do a PANEL ON WORK LIFE BALANCE or let's have HAPPY HOUR!! Nope. People just want more money.

but no, seriously, the panels are great. especially if i cant attend because partner wants me to get X or Y out ASAP. but the leftover food is still not quite too cold to be eaten.

My firm hired two new HR types specifically to address retention issues. lol, just fire them and redistribute their salaries to associates

[cookiejar1]

Let's focus on our message: NYC to 190. Tell your retention HR specialists that. It doesn't have to make sense. Just do us a solid, guys.

[Old Gregg]

the hr specialists have no power to do anything. thats what makes it so funny

[sims1]

I can definitely see bonuses going up. Since 160 has been market for so long, inflation means that the effective salary has been decreasing every year. Now that law firms are doing well again, a 10k boost to first years wouldn't be THAT crazy.

[hoos89]

you guys act like law firms need someone smart to do the work. very few practice groups need someone smart so much as they need a hard worker. nyc aint going to 190 before 2020. they might give midlevels a raise. but there's no incentive because they have ample supply of fist years to choose from.

before nyc goes to 190, recruiters will start adding law students on linked in. you can bank on that.

Funny story: a recruiter added me on LinkedIn a few weeks ago.

[KM2016]

you guys act like law firms need someone smart to do the work. very few practice groups need someone smart so much as they need a hard worker. nyc aint going to 190 before 2020. they might give midlevels a raise. but there's no incentive because they have ample supply of fist years to choose from.

before nyc goes to 190, recruiters will start adding law students on linked in. you can bank on that.

Funny story: a recruiter added me on LinkedIn a few weeks ago.

So, naturally the next step is for NYC to $190! Lol.

[Old Gregg]

i get recruiter adds on linked in all the time.

and i never accept them. fucking morons

[Cobretti]

Its too attenuated for a 190 year old firm to have a recruiting horizon of > 3 years?

The hivemind keeps fighting me on this issue every time it comes up and it blows my mind.

What blows my mind is that every time this comes up I haven't seen you provide any evidence for it beyond "it makes sense to me that it would work this way." I mean, there are still tons of people going to top law schools. What do biglaw firms have to worry about? They're filling their classes. Why on earth would they need to recruit people to go to law school - and even if they did, again, is salary really the issue? Is there any meaningfully-sized group of people who would turn down biglaw at $160k but bite at $175k or $190?

Last post on the subject.

http://www.investopedia.com/articles/ec ... ntages.asp
See "Cobweb Model" for explanation of how wages factor into supply/demand curves for industries that require extensive training.

"Industries with higher requirements tend to pay workers higher wages, both because there is a smaller labor supply capable of operating in those industries and because the required education and training carries significant costs."

"The worker must consider a number of factors when deciding whether to enter a training program:

How much extra productivity would he or she expect to gain?
What is the cost of the training program? Will the worker see a wage increase that would warrant the cost of the program?
What is the labor market like for a better-trained professional? Is the market significantly saturated with trained labor already?"

2007 LSAC applicants: 84,000
2014 LSAC applicants: 55,700
Change: -32%
http://www.lsac.org/lsacresources/data/ ... me-summary

NU as example of tuition changes since 2007
2007 Tuition at NU: $40,410
http://www.northwestern.edu/budget/rate ... Tables.pdf
2015 Tuition at NU: $56,134
http://www.law.northwestern.edu/admissi ... d/tuition/
Change: 39%

Inflation since 2007: 12.7%
http://www.usinflationcalculator.com/

[KM2016]

Its too attenuated for a 190 year old firm to have a recruiting horizon of > 3 years?

The hivemind keeps fighting me on this issue every time it comes up and it blows my mind.

What blows my mind is that every time this comes up I haven't seen you provide any evidence for it beyond "it makes sense to me that it would work this way." I mean, there are still tons of people going to top law schools. What do biglaw firms have to worry about? They're filling their classes. Why on earth would they need to recruit people to go to law school - and even if they did, again, is salary really the issue? Is there any meaningfully-sized group of people who would turn down biglaw at $160k but bite at $175k or $190?

Last post on the subject.

http://www.investopedia.com/articles/ec ... ntages.asp
See "Cobweb Model" for explanation of how wages factor into supply/demand curves for industries that require extensive training.

"Industries with higher requirements tend to pay workers higher wages, both because there is a smaller labor supply capable of operating in those industries and because the required education and training carries significant costs."

"The worker must consider a number of factors when deciding whether to enter a training program:

How much extra productivity would he or she expect to gain?
What is the cost of the training program? Will the worker see a wage increase that would warrant the cost of the program?
What is the labor market like for a better-trained professional? Is the market significantly saturated with trained labor already?"

2007 LSAC applicants: 84,000
2014 LSAC applicants: 55,700
Change: -32%
http://www.lsac.org/lsacresources/data/ ... me-summary

NU as example of tuition changes since 2007
2007 Tuition at NU: $40,410
http://www.northwestern.edu/budget/rate ... Tables.pdf
2015 Tuition at NU: $56,134
http://www.law.northwestern.edu/admissi ... d/tuition/
Change: 39%

Inflation since 2007: 12.7%
http://www.usinflationcalculator.com/

So...more money?

[Desert Fox]

Midlevels are bringing in at least a million bucks in revenue at decent NYC biglaw. Probably 1.2+ if they are working a full 2000 or more. 30% revenue--> labor is within acceptable ranges. So 350k for a midlevel isn't absurd or unaffordable. Especially since labor is the only significant COGS for legal services.

The ridiculous part is that compensation is flat. A midlevel who works 400 extra hours gets nothing and the firm gets 250k of pure profit.

There are firms where this probably isn't realistic, but only because greed pig partners will flee to DLA piper for extra 50k a year.

[rpupkin]

DLA piper for extra 50k a year.

dla piper to $210K confirmed by TLS insider.

[Desert Fox]

DLA piper for extra 50k a year.

DLA Piper to $210K confirmed by TLS insider.

DLA Baltimore-Office B worker confirms

[A. Nony Mouse]

Confetti, that still doesn't prove that specific law firms actually believe they're running into trouble recruiting people at this salary.

[Cobretti]

Confetti, that still doesn't prove that specific law firms actually believe they're running into trouble recruiting people at this salary.

lol, this is perfect. thank you.

[dixiecupdrinking]

The other issue is that these firms are basically collusive so even if a top firm were having trouble recruiting good enough juniors -- and I doubt any are -- there's no benefit to increasing salaries. If Cravath goes to 175, DPW will match within a week. The only firms that can't afford to match are the ones these firms aren't competing with for talent anyway.

Midlevels are bailing to go in-house, take government jobs, etc. That's an area where it makes some sense to compete on compensation. DOJ isn't going to increase their salaries to match Cravath and you might see some increased retention.

[Big Shrimpin]

NOAP

/thread

[2014]

The other issue is that these firms are basically collusive so even if a top firm were having trouble recruiting good enough juniors -- and I doubt any are -- there's no benefit to increasing salaries. If Cravath goes to 175, DPW will match within a week. The only firms that can't afford to match are the ones these firms aren't competing with for talent anyway.

This is obviously true but it was equally true in 2007 or whenever Simpson went to 160 and yet they still did, so there are more forces at play.

[Anonymous User]

I mean, there are still tons of people going to top law schools. What do biglaw firms have to worry about? They're filling their classes. Why on earth would they need to recruit people to go to law school - and even if they did, again, is salary really the issue? Is there any meaningfully-sized group of people who would turn down biglaw at $160k but bite at $175k or $190?

Who knows if there is a group of people who would turn down biglaw at $160k but would bite at $190k? The answer is probably yes, and the people are probably populated by very high achieving college students that have other very lucrative options. But I haven't done a survey, so maybe not.

Some firms care more than just filling their classes. A Cravath doesn't hire lateral partners (or does so very rarely). They need at least some of their associates to not only be partner material, but also to stay long enough to make partner. Sure, most of their class is just warm bodies who will be gone in a couple years - but they still need to attract and retain that type of talent.

That said, it makes more sense to compensate with a bonus that can be taken away in a down year.

[Johann]

you guys act like law firms need someone smart to do the work. very few practice groups need someone smart so much as they need a hard worker. nyc aint going to 190 before 2020. they might give midlevels a raise. but there's no incentive because they have ample supply of fist years to choose from.

before nyc goes to 190, recruiters will start adding law students on linked in. you can bank on that.

Funny story: a recruiter added me on LinkedIn a few weeks ago.

you probably thought i was joking - but i actually think this is a legit sign. needs to be common and widespread through.

[Johann]

Its too attenuated for a 190 year old firm to have a recruiting horizon of > 3 years?

The hivemind keeps fighting me on this issue every time it comes up and it blows my mind.

What blows my mind is that every time this comes up I haven't seen you provide any evidence for it beyond "it makes sense to me that it would work this way." I mean, there are still tons of people going to top law schools. What do biglaw firms have to worry about? They're filling their classes. Why on earth would they need to recruit people to go to law school - and even if they did, again, is salary really the issue? Is there any meaningfully-sized group of people who would turn down biglaw at $160k but bite at $175k or $190?

stats

But the thing is why do law firms need to raise hte first year law salary to draw the smart people. the smart people - and you can see it on this forum - think they will be partners making $1 mill+ within 10 years. The themselves have essentially made the first year salary meaningless by jumping to the career earnings and thinking its a lock.

And the supply going down is still meaningless when there is sufficienct supply. 100% supply + 2x extra is the same as supply +1x extra. Students being more in debt can cut both ways. Because paying people 190 just leads to more people taking the job with the plan of working for a year or 2 to leave and pay down loans. So you just present yourself with more of a problem of creating the good midlevels that leave beacuse theyve paid down their debt. It's no secret people leave biglaw once they get their debt under control.