Everyone knows the continuing economic recession has put tremendous pressure on the big firm staffing model. Layoffs continue and most major firms have drastically reduced their entry level hiring. Even if you can get a big firm position, or keep the one you have, what will it pay? The answer looks like less than you might have thought with a lot of pressure driving down entry-level salaries.
Over the past decade, big firm associate salaries increased at a pace far exceeding the rate of inflation. This put pressure on firms to pass on the higher costs to clients. In good times, clients were more willing to pay the freight on the belief that they were receiving higher quality service.
Now, clients demand different billing structures and lower costs. Firms can no longer pass expenses on to clients without the risk of losing their business. Moreover, there are more opportunities than ever to outsource routine legal work or hire temporary assistance during times of heavy demand. What could be termed “commodity” legal work (document review, routine drafting, etc.)—work that was once done exclusively by entry-level lawyers—can now be done more cheaply (and perhaps efficiently) elsewhere.
Where does all this leave the newer lawyer or law graduate? To justify making the bigger bucks, you will HAVE to demonstrate your value. This means less emphasis on pedigree and credentials with more focus on technical skills, business development potential and client service. The successful younger lawyer in private practice, whether in big firm or small, now must think of him or herself as an entrepreneur. The focus has to be on what you will bring that separates you from everyone else—whether your client is a small business or the partner in the office next door.