The Future of Big Law Associates
Big Changes, New Choices
By Tamara Loomis
BELIEVE IT: The worst economic downturn since the Great Depression has
hit law firms hard. Historically, the legal sector has weathered recessions better
than many other sectors have, buoyed by the attendant surges in litigation and
bankruptcy work. That’s what’s happened, for instance, amid the wave of corporate
scandals—the so-called Enron era—that followed the bursting of the high-tech
bubble. Not this time. Big firm are hurting, their profit margins squeezed by both
sagging demand and record-high expenses. The result: the now familiar litany of
mass layoffs, salary freezes and cuts, deferred start dates for first-year associates, and
canceled or downsized summer programs.
Given all that, the $160,000 question now is, what happens when the economy
recovers? Will things go back to how they were?
The answer, according to law firm and law school leaders, is no. They say that
the recession and events leading up to it have permanently changed the way business is done in the legal industry. The recent boom—with its eye-popping billing
rates of $1,000 per hour, first-year associate salaries of $160,000, and bloated ranks
of junior associates—is over. In its place, for now at least, is a new era in which
law firms are expected to focus on being more cost-efficient. For the law student
The recession has helped usher in a new era.
Better to embrace it than yearn for the good old days.