Law Firm Hiring Crisis Ahead?

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Want a feel good piece to start the week off?  Don't read this one then The Fire This Time: Thoughts on The Coming Law Firm Hiring Crisis.  In it, Arik Press in The American Lawyer wrote today about the paradigm shift in hiring and retention in the big firm market.

"If present trends continue in the big firm market, we are heading toward -- you pick the cliche -- a paradigm-shifting, blood-in-the-suites, terror-on-the-campus hiring and retention crisis. The "economic reset" that General Electric's Jeffrey Immelt has tagged seems likely to force changes in the way firms recruit, pay and/or retain their lawyers. The market for labor has changed and, for now at least, there's no normal to which it can return."

And that is just how it starts.  Press points to several key issues:

• Demand for legal services is flat or down.  Since some areas of law are seeing healthy workloads and growth, that means that some practice areas are seeing dismal workloads.
• Haggling between business generators and other equity partners are likely to grow, as firms identify who is bringing in business and who is not.
• Law firms depend on attrition (up to 25% of assoicates annually) as part of their historical structure.  With few people leaving on their own, the layoffs we are seeing are the firms' way of making that happen.

What to expect (if the economy does not jump start soon):

• Lower starting salaries.
• Wage freezes and cuts
• Delayed start dates for new assocaites
• Fewer summer associates
• More layoffs