Inflation and BigLaw Salary Scale
Posted: Mon Jun 07, 2021 12:23 am
Should we expect salaries to increase to keep pace with inflation? If so, when/how might we see a bump?
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$190k happened pretty recently.lawhawk1836 wrote: ↑Mon Jun 07, 2021 12:23 amShould we expect salaries to increase to keep pace with inflation? If so, when/how might we see a bump?
Even on a CPI basis, 2000 was a high water mark for associate compensation. One thing that's a bit different is that things weren't quite so "market" back then. Today, there are almost 100 firms that pay "market" to start. Back then, it was more like today's equivalent of the v20, and pretty much only in NYC proper. But I wouldn't be surprised to see further differentiation between top earning firms and lower tier firms. Paying a 1st year know-nothing associate $200k is a very different proposition when partners are making $4 million/yr compared to when they are making $500k.soft blue wrote: ↑Wed Jun 09, 2021 1:58 pmRationale has always been talent retention / acquisition. (Milbank to $190k, e.g., they wanted "better" candidates.) It'll happen when a firm wants to attract "better" candidates at OCI and not before. Wonder who that would be.
I wonder if, after this year, BigLaw comp goes more bonus-heavy. It's individualized-ish (so the firm has the chance to really pay the people who might jump ship who they need to keep), not guaranteed (so it can be walked-back), etc. K&E seems to have some success with this model, JD a bit less so?
Re: inflation adjusting, CPI doesn't reflect rent, etc in HCOL cities and increasing law school debt. NYC rents from 2000->2020 (excluding COVID). The site says a 1st year in 2000, all in, made $160k compared to $202k today. That's a ~25% nominal growth, but I'm certain that the cost of living in NYC went up > 25% between 2000->2020 (ditto SF, DC). We're for sure worse-off today.
Milbank: . . . and I took that personallyBosque wrote: ↑Tue Jun 08, 2021 7:16 pmIf you look at inflation adjusted numbers the scale is still currenty on the high end of what it has ever been. I highly doubt we see any base salary changes for at least two years. Will be interesting to see if special bonuses stick around this time, but they never have in the past (though they also have not been this standardized).
Got 'em.Lawperson1892 wrote: ↑Thu Jun 10, 2021 12:26 pmMilbank: . . . and I took that personallyBosque wrote: ↑Tue Jun 08, 2021 7:16 pmIf you look at inflation adjusted numbers the scale is still currenty on the high end of what it has ever been. I highly doubt we see any base salary changes for at least two years. Will be interesting to see if special bonuses stick around this time, but they never have in the past (though they also have not been this standardized).
Lawperson1892 wrote: ↑Thu Jun 10, 2021 12:26 pmMilbank: . . . and I took that personallyBosque wrote: ↑Tue Jun 08, 2021 7:16 pmIf you look at inflation adjusted numbers the scale is still currenty on the high end of what it has ever been. I highly doubt we see any base salary changes for at least two years. Will be interesting to see if special bonuses stick around this time, but they never have in the past (though they also have not been this standardized).