BigLaw Salary Dropping? Forum

[JSC4]

Does anybody think the salaries for Big Law will drop over the next 5-7 years? It seems as though a few firms have already dropped a few salaries for first years, but this may just be an attempt to bounce back from the recession.

I ask this because it seems as though the salaries for many professionals are dropping significantly. For example, the average salary of a Chartered Accountant in 2000 was SIGNIFICANTLY greater than the average salary of an accountant today.
Do you think this will happen to Big Law salaries?

[Cavalier]

NY TO 190!!!

[swc65]

CHECK YOU SPRING BONUSES.

In all seriousness, who knows? they could go up, down, sideways, be torn apart into base + merit +bonus +cunnilingus skill. A year ago everyone said BigLaw was dead. a year before that they all said BigLaw would get through the recession just fine. A few years before that, salaries were skyrocketing!!

I cannot resist speculating though. Since it seems that the worst of the banks' troubles are behind us and BigLaw is intimately tied to them, then I would say that the small drop that has already been experienced is probably the worst of it. I expect (though I am not purporting to be any kind of expert or wiccan --LinkRemoved--) salaries will drag sideways for a bit before heading up ever so slowly- hopefully enough to keep pace with inflation. Unless, of course, there is yet another calamity that send everything into the shitter (i.e. EQ, tsunami, nuclear reactor explosions, multiple wars in major oil producing countries, sovereign debt defaults). Oh wait....

[swc65]

NY TO 190!!!

Also this.

[09042014]

I think we'll see entry level salaries stay flat, but midlevel might go up slowly.

The big law model is silly, but it survived the economic crash just fine.

[nealric]

In a word, no (absent a second wave of recession).

The only firms that dropped salaries were 2nd or 3rd tier firms. Most of the firms that reduced salaries raised them right back.

[swc65]

In a word, no (absent a second wave of recession).

The only firms that dropped salaries were 2nd or 3rd tier firms. Most of the firms that reduced salaries raised them right back.

Or dissolved !!

[Anonymous User]

They will stagnate where they are presently. Only a few firms at the very top will be able to offer raises. I am talking about the top 3 or 5 firms in income per partner. Even the rest of the firms in the V20 are feeling enormous pressure to maintain profits since they raised salaries again. Based on that, they will be unable to raise salaries on a continuous basis.

[nealric]

They will stagnate where they are presently. Only a few firms at the very top will be able to offer raises. I am talking about the top 3 or 5 firms in income per partner. Even the rest of the firms in the V20 are feeling enormous pressure to maintain profits since they raised salaries again. Based on that, they will be unable to raise salaries on a continuous basis.

The real pressure on salaries is the rainmaking partners. The increasing free agency partners have means that firms tend to have to pay more and more to keep the top dogs happy.

[Noval]

They will stagnate where they are presently. Only a few firms at the very top will be able to offer raises. I am talking about the top 3 or 5 firms in income per partner. Even the rest of the firms in the V20 are feeling enormous pressure to maintain profits since they raised salaries again. Based on that, they will be unable to raise salaries on a continuous basis.

The real pressure on salaries is the rainmaking partners. The increasing free agency partners have means that firms tend to have to pay more and more to keep the top dogs happy.

Well the life of a Partner is always a gamble, the more clients you bring in, the more money you rack up, that's probably becaue of this risk that some Associates leave for In-House/Business as soon as they reach financial stability(Ex:No more debts).

[tome]

They will stagnate where they are presently. Only a few firms at the very top will be able to offer raises. I am talking about the top 3 or 5 firms in income per partner. Even the rest of the firms in the V20 are feeling enormous pressure to maintain profits since they raised salaries again. Based on that, they will be unable to raise salaries on a continuous basis.

The bolded is unlikely. In the past, when ever one top firm raises its salary, all the others way down the line go up with them. ITE is no reason to think that this will cease. There is just too much pressure to not lose entry talent (take the recent Spring bonuses as an example of this in action). Where firms can make cuts is further down the chain (4th year associates, etc.). But there is nothing new about this, there has always been variation people between firms at this level.

[bree]

1) Short-Term: it's going to stagnate - basically, we're stuck at 160 for a while (which effectively means the starting salary is decreasing thanks to inflation ...)

2) Long-Term: it'll go up sooner or later (it always does ...) ... there have been periods where it's stuck at a level for a few years (e.g. 125K around the tech bubble in 2000) and then it goes up within a few years

[swc65]

1) Short-Term: it's going to stagnate - basically, we're stuck at 160 for a while (which effectively means the starting salary is decreasing thanks to inflation ...)

2) Long-Term: it'll go up sooner or later (it always does ...) ... there have been periods where it's stuck at a level for a few years (e.g. 125K around the tech bubble in 2000) and then it goes up within a few years

In other words NY to 190....

[KibblesAndVick]

No firm wants to be the first one to lower salaries. It's not like they can all get together and decide to categorically drop entry level to 150. Going backwards would make the firm stand out in a bad way and scare away talent.

Based on how firms reacted to the recession the cost cutting move seems to be hiring less people in the first place. Like if they typically hired 10 people at market they would cut it to 7 at market instead of trying to get 10 at a discount.

[well-hello-there]

judging by the title of this thread, I was expecting this to be the place where people working biglaw would come and share their payscales. anonymously of course. shucks

[Stanford4Me]

The government ain't taking my pay.