ABA Journal article for prospective & practicing attorneys

Former corporate equity partner here. Crediting the entire article. It is a grim reality

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Seeking associates with one to five years experience in deal making (mergers & acquisitions as well as private equity). “Let’s make sure they’re not crazy” rather than “are they a good fit.”

I’m confused - I’ve seen so many threads here and on FB/Twitter about the oversupply of lawyers, students graduating into a horrific job market, etc etc. Now there’s a shortage?

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It is complicated. There are multiple “levels” of attorneys at a big law firm that are more detailed than merely associate and partner. Mid levels are how partners make money because mid levels have the expertise clients need, the incentive to bill a ton of hours as partnership prospects become clearer, and can be somewhat independent. Firms are desperate for attorneys with two or more years of experience. This does not affect entry level hiring much, and will likely not increase the number of equity partners in any significant way.

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While there are too many lawyers, there are great employment opportunities for law grads from the top 13 - 15 law schools.

For young lawyers entering into the largest law firms (biglaw), pay for the first 8 years is:

  1. $205,000 plus about $15,000 in bonus pay = $220,000 expected total first year pay exclusive of any special retention bonus payments.
  2. $215,000 plus $20,000
  3. $240,000 plus $30,000
  4. $275,000 plus $57,500
  5. $305,000 plus $75,000
  6. $330,000 plus $90,000
  7. $350,000 plus $105,000
  8. $365,000 plus $115,000 year end bonus = $480,000 expected compensation for an 8th year associate excluding any special retention bonus money.

For young lawyers with at least one year of big law firm mergers & acquisitions transactions experience, there is a shortage. Competing firms are offering signing bonuses for lateral transfers of about $30,000 to as high as $250,000.

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The thing is that most people will be forced out of big law well before year Eight. Most are lucky to get six years in, and they will have sacrificed an inordinate amount to last that long. One of the many reasons I don’t recommend law is that the decent pay years end quickly with a sharp decline when you go in house. There are unicorn positions in house that you cannot rely on.

Yes, but many leave biglaw after about five years with no remaining student loan debt and significant accumulated savings/investments.

A lot leave with debt now and that is after commuting from places like bed stuy and Hoboken, far from the office. The notion an attorney pays off debt and has a million saved/invested I don’t think is accurate from my time as an equity partner. I would be careful giving a 22 year old that sort of information.

It is not atypical during this period of investment returns.

I am comfortable advising interested 21 & 22 year olds to consider attending law school if affordable without loans or if attending a top 13 law school. But, each situation has variables that should be taken into consideration.

Best overall, basic advice is to avoid or minimize student loan debt.

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How much are you assuming they save per month, assuming no debt upon graduation at age 25? And where do they live so we can factor in debt and rent with roommates? I don’t think you’re numbers are adding up.

Any 22 year old should be traveling, trying out different jobs, and getting into finance or consulting or F500 management if possible. Law is really a reset on a career. If you have any Ivy undergrad you’re basically throwing it away if you go to law school because firms do not care where you went to college or what you majored in unless you’re in IP.

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Never heard of a Big Law associate living in Bed Stuy. If you work downtown, Hoboken is an easier commute than the UES or UWS. That said, I agree with you about avoiding law. If you are smart enough to get into an elite law school, there are better career options.

The debt load for some associates has become so severe they have roommates in undesirable neighborhoods. Top Law School Forum has discussed this a lot too.

Exactly, if you can hack it in big law and make a career of it (which I have), you should do something else. The companies I started and the ones I took over from others are far more intellectually engaging, challenging, and lucrative than anything I did as a big law partner. Leaving the partnership was the best personal and financial decision I ever made.

If you believe that “law is really a reset on a career”, then we just disagree–although it can be for some.

As for investment assumptions, I edited my post as I do not want to argue since the past several years have been great for those investing in the stock market–especially in broad index funds–and the results, therefore, may be distorted.

It is a reset in there your undergraduate education, professional experiences, and general accomplishments prior to law school have almost no bearing on recruitment and advancement. Your class rank, law review, and performance on the job are everything. Completed a bulge bracket analyst stint? Doesn’t matter. Major in math at Dartmouth and are 85th percentile at UVA? The comp lit major from Conn College who is 90th percentile is ahead of you in the recruiting line.

Thank you for clarifying your position regarding “career reset”.

Your statement that one’s “class rank, law review, and performance on the job are everything” is lacking one important factor = law school attended. And, in the current environment, some might assert that “performance on the job” is not a very high standard as many biglaw firms just need licensed,warm bodies with m&a transaction experience who do a competent job.

You’re right, my bad. As you have said, keeping debt to a minimum while going to the best law school possible is what a prospective lawyer must strive for to make the most of it.

Just pointing out that there are expensive coops in Bed Stuy (and some streets with renovated mansions which are absolutely gorgeous), and it strikes me as veiled racism to describe a neighborhood as “undesirable” when it has both expensive places to live AND is majority non-white.

Hoboken is a MUCH better commute to many law firms than supposedly “desirable” neighborhoods. Again- is the fact that non-whites live in Hoboken (in some luxury buildings) a reason not to live there?

The first apartment that came up when I searched Bed Stuy is for 9K per month, a restored brownstone built in 1899. Architecturally significant AND gorgeous.

Check your privilege.

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Four boroughs and almost every neighborhood is majority non-white. The exceptions are SI, southern Brooklyn, and the occasional Queens and Bronx neighborhood. Almost no part of the five boroughs is a reasonable per square foot rent in the eyes of someone from the Midwest, South, or Florida. Bed-Stuy is not a fashionable area. It lacks yuppies living out their “Sex and the City” fantasy or artists. Yuppies need easier commutes than inner Brooklyn. Please stop making incendiary accusations and assumptions, are you a real estate agent boosting Bed Stuy or something?

Not a real estate agent. I have no axe to grind. But I know several “uber wealthy” folks who live in Bed Stuy, so I found your remarks a little incendiary, as if to imply that a neighborhood with gorgeous, restored brownstones, nice restaurants, and the kind of people who frequent them, is somehow “undesirable”. I can’t afford 9K a month in rent, but if I could- I’d be there.

The Hamptons are also a terrible commute. Hasn’t driven their prices down during the pandemic either…