What do these four firms have in common: Nossaman Guthner Knox & Elliott; Irell & Manella; Finnegan, Henderson, Farabow, Garrett & Dunner; and Quinn Emanuel Urquhart Oliver & Hedges?
- All four have decided to increase base salary for first-year associates by $10,000.
- All four are 100-300 lawyer firms, with eight or fewer offices.
How are the global megafirms responding? With the sound of one hand clutching a wallet. Rumors persist that raises are just around the corner — but so far they haven’t happened. During the salary wars of the 1990s, one increase would be met immediately by virtually every other top player. Nobody dared being seen as trailing the pack.
So, what’s different now? Could it be that the megafirms — with top billing rates already in the $800-an-hour neighborhood and having committed a ton of investment in new international offices — are caught in a squeeze?
Scott DeVries, managing partner at Nossaman — which just raised first-year salaries from $115,000 to $125,000 — says it’s a more a sign of the tightening labor market. During the leaner first half of the decade, plenty of top-tier talent was on the market, and a midsize firm with a quality reputation could attract some of it even at rates slightly below market. But as the megafirms have ramped up hiring, top-tier graduates have grown scarce.
— Scott Graham