wsj blog article on biglaw hiring Forum

[NYSprague]

http://m.us.wsj.com/articles/BL-LB-48410

Blah blah blah hiring better than recession but still soft and varied.

Of interest:
3980 jobs in firms over 500 in 2013
5156 jobs in firms over 500 in 2009
20 firms have increased since 2009 (though not listed; apparently from Chambers)
Cravath about the same
Most everyone else is down or way down.


.

[NYSprague]

Just realized that those NALP numbers don't break down by salary. Some of those new hires will be the permanent back office no partnership track in West Virginia. I don't know how many.

[Nebby]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

[NYSprague]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

I didn't read it that way. But yes, hiring is generally better than the recession. I didn't look up the numbers for 2010, 2011, or 2012.

It would be nice to know how many of these jobs were real.

[09042014]

Almost all are real. The WV thing is really only done by DLA Piper. Everyone else just uses temp workers.

[dead head]

Almost all are real. The WV thing is really only done by DLA Piper. Everyone else just uses temp workers.

And Orrick, and Reed Smith, and Bingham...

[09042014]

Almost all are real. The WV thing is really only done by DLA Piper. Everyone else just uses temp workers.

And Orrick, and Reed Smith, and Bingham...

It's still pretty limited in scope.

[09042014]

My guess is 2014 will be lower. 2013 OCI is considered to be the best since the recession started, better than c/o 14 and 15.

[84651846190]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

Past trends have nothing to do with the future when it comes to the legal market (or almost any other market for that matter).

[Nebby]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

Past trends have nothing to do with the future when it comes to the legal market (or almost any other market for that matter).

Barring another recession, I assume an upward trend will continue until the market reaches pre-recession numbers. Can you explain your response a bit? Taking what you say literally would mean there's really no predictive value in the past at all, but I assume you didn't mean that.

[09042014]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

Past trends have nothing to do with the future when it comes to the legal market (or almost any other market for that matter).

Barring another recession, I assume an upward trend will continue until the market reaches pre-recession numbers. Can you explain your response a bit? Taking what you say literally would mean there's really no predictive value in the past at all, but I assume you didn't mean that.

There are several reasons why I think this is wrong.

First, the run up to the recession had a lot of extra legal work that is no longer really done in large amounts. Derivatives work was making firms fat and that is never coming back. It was a bubble.

Second, doc review has been outsourced. You used to need dozens of junior associates to do that work. Now it's done by people making 19 dollars an hour. Clients won't pay for it anymore, other than in rare cases or huge bet the company litigation. Some of the V10 + elite mega firms can still bill 450 an hour for doc review, but for the most part it's gone.

Part of the reason firms were sucking up even idiots from the bottom 5% at T14's during hte boom, is because worst case, you bill them out at 450 an hour as a doc review turd for 3 years then cut them loose.

It's also the reason why lit options for students are worse than transactional.

Third, but this is speculation, associates are sticking around longer because they don't have great exist options. The model used to be a pyramid, but it's looking more house shaped now.

[Nebby]

Thanks for the background! That makes sense.

[84651846190]

Good find. Thanks for posting.

Good upward trend for Class of '16 folks like me!

Past trends have nothing to do with the future when it comes to the legal market (or almost any other market for that matter).

Barring another recession, I assume an upward trend will continue until the market reaches pre-recession numbers. Can you explain your response a bit? Taking what you say literally would mean there's really no predictive value in the past at all, but I assume you didn't mean that.

Think about what people in 2005 would have said if you asked them where the legal market would be in five years. Do you really think many of them would have predicted an epic collapse?

If past trends did have predictive value, more people would be signing up for law school. The opposite is happening.

[John Everyman]

Even if the number hired isn't as high as 2013 going forward, shouldn't we still likely see gains in the overall percentage hired due to class size reductions?

[sundance95]

Think about what people in 2005 would have said if you asked them where the legal market would be in five years. Do you really think many of them would have predicted an epic collapse?

If past trends did have predictive value, more people would be signing up for law school. The opposite is happening.

Or, the reactions of employment markets with high opportunity costs to enter (read: which take a long time to obtain necessary credentials) tend to lag behind economic reality. That's why we are only now seeing radical shrinking of class sizes, instead of in C/O 2012 (which began law school in 2009) as one might expect if the law student market reacted perfectly to extant economic conditions.

[84651846190]

Think about what people in 2005 would have said if you asked them where the legal market would be in five years. Do you really think many of them would have predicted an epic collapse?

If past trends did have predictive value, more people would be signing up for law school. The opposite is happening.

Or, the reactions of employment markets with high opportunity costs to enter (read: which take a long time to obtain necessary credentials) tend to lag behind economic reality. That's why we are only now seeing radical shrinking of class sizes, instead of in C/O 2012 (which began law school in 2009) as one might expect if the law student market reacted perfectly to extant economic conditions.

This is just more evidence that no one has any idea of what the future will hold. The existence of a lag effect is, in and of itself, evidence that past legal trends don't have predictive value. If they did, the lag wouldn't exist (or at least wouldn't be as pronounced as it is).

[Jchance]

2013 OCI is considered to be the best since the recession started, better than c/o 14 and 15.

2013 OCI was for c/o 2015...

[09042014]

2013 OCI is considered to be the best since the recession started, better than c/o 14 and 15.

2013 OCI was for c/o 2015...

I meant C/O 13 OCI.

[FSK]

There are several reasons why I think this is wrong.

First, the run up to the recession had a lot of extra legal work that is no longer really done in large amounts. Derivatives work was making firms fat and that is never coming back. It was a bubble.

Second, doc review has been outsourced. You used to need dozens of junior associates to do that work. Now it's done by people making 19 dollars an hour. Clients won't pay for it anymore, other than in rare cases or huge bet the company litigation. Some of the V10 + elite mega firms can still bill 450 an hour for doc review, but for the most part it's gone.

Part of the reason firms were sucking up even idiots from the bottom 5% at T14's during hte boom, is because worst case, you bill them out at 450 an hour as a doc review turd for 3 years then cut them loose.

It's also the reason why lit options for students are worse than transactional.

Third, but this is speculation, associates are sticking around longer because they don't have great exist options. The model used to be a pyramid, but it's looking more house shaped now.

The first two don't address the next OCI however (though I can't think of anything to rebut your suggestion that it will be less). Hasn't that been factored well in by now?

[FSK]

Accidental double post.

[OutCold]

There are several reasons why I think this is wrong.

First, the run up to the recession had a lot of extra legal work that is no longer really done in large amounts. Derivatives work was making firms fat and that is never coming back. It was a bubble.

Second, doc review has been outsourced. You used to need dozens of junior associates to do that work. Now it's done by people making 19 dollars an hour. Clients won't pay for it anymore, other than in rare cases or huge bet the company litigation. Some of the V10 + elite mega firms can still bill 450 an hour for doc review, but for the most part it's gone.

Part of the reason firms were sucking up even idiots from the bottom 5% at T14's during hte boom, is because worst case, you bill them out at 450 an hour as a doc review turd for 3 years then cut them loose.

It's also the reason why lit options for students are worse than transactional.

Third, but this is speculation, associates are sticking around longer because they don't have great exist options. The model used to be a pyramid, but it's looking more house shaped now.

The first two don't address the next OCI however (though I can't think of anything to rebut your suggestion that it will be less). Hasn't that been factored well in by now?

It has been factored in, which is why hiring has remained low. Sure, there has been a bounce-back to compensate for the extra work post-recession, but now that things are largely stabilized, what leads you to believe that firm hiring would be increasing? There needs to be a large amount of work that firms can't handle with their current associate numbers to justify taking on added salaries, especially when the alternative is to simply have their current associates work an extra 50-100 hours a year at no extra salary expense. The fact of the matter is that there hasn't been any boom in workflow. This is the new normal, at least until the next bubble comes along in 10-15 years and everyone forgets previous stupidity while they feast for a few years. You have to remember that the early to mid 2000s were not the norm.

[09042014]

There are several reasons why I think this is wrong.

First, the run up to the recession had a lot of extra legal work that is no longer really done in large amounts. Derivatives work was making firms fat and that is never coming back. It was a bubble.

Second, doc review has been outsourced. You used to need dozens of junior associates to do that work. Now it's done by people making 19 dollars an hour. Clients won't pay for it anymore, other than in rare cases or huge bet the company litigation. Some of the V10 + elite mega firms can still bill 450 an hour for doc review, but for the most part it's gone.

Part of the reason firms were sucking up even idiots from the bottom 5% at T14's during hte boom, is because worst case, you bill them out at 450 an hour as a doc review turd for 3 years then cut them loose.

It's also the reason why lit options for students are worse than transactional.

Third, but this is speculation, associates are sticking around longer because they don't have great exist options. The model used to be a pyramid, but it's looking more house shaped now.

The first two don't address the next OCI however (though I can't think of anything to rebut your suggestion that it will be less). Hasn't that been factored well in by now?

First, I dispute there has been an upward trend since Class of 2013 OCI. It's been steady not growing.

Second, you said upward trend until we hit prerecession, which is what I'm disputing. Prerecesssion doesn't mean shit because there have been structural changes in big law hiring. The 25% that firms are down since 2007? It's never coming back. Those jobs were needed to do derivative work and doc review.

It's all factored in , but it's not changing.

[dead head]

This is just more evidence that no one has any idea of what the future will hold. The existence of a lag effect is, in and of itself, evidence that past legal trends don't have predictive value. If they did, the lag wouldn't exist (or at least wouldn't be as pronounced as it is).

There would still be a lag unless biglaw stops basing their entry-level hiring on rising 2Ls.

[hellojd]

I think it also depends on where you stand as to what you want to happen. I feel like if you have a good shot at landing prestigious biglaw somewhere, you are actually fine with the hiring not going back to pre-recession levels. Lower associate hiring should in theory mean more job security down the line because there are simply fewer associates to compete with for work and they'll have no reason to thin the herd as much. The downside is you may be asked to put in longer hours.

On the other hand, if you are at a T20 and are on the "bubble" of having a good shot at a biglaw job, you do want the hiring to increase.

[MikeJD]

The problem is that summer SA classes are getting smaller.