The BCG Attorney Search 2018 State of the American Lateral Law Firm Legal Market Report

Introduction

The 2017 legal market was one of the best on record-but it was much different than the previous boom markets of 1999 and 2005-2006. It is the sort of legal market that gives the impression of massive opportunity in the legal sector, which drives people to go to law school. The legal market is in a boom again.

As a preliminary matter, it is important to note that our legal recruiting firm has historically dealt with the best candidates seeking positions in the best law firms. To some extent, our placement results have typically shown demand at the higher end of the legal market-the best attorneys seeking positions in the best firms. The 2017 calendar year was different in so many respects. The candidates we were able to place were no longer almost exclusively candidates coming from the best law schools and law firms. Across the board, our recruiters made placements of candidates in large and small law firms that almost never would have been made in normal market conditions.

These placements were so notable that I started creating case studies of my placements this year. You can view the evolving list here: Harrison’s Case Studies. What was so incredible about 2017 was that I took six months off from legal recruiting during the year to work on a book on diversity in the legal profession and still had a record year of placements-working half as much. Had I worked the entire year the results would have presumably been two times as good.

Here are some highlights, however, of just some of my placements in 2017 that were unusual and would not have occurred unless the market was doing as well as it is:

• A candidate from a third tier law school, with no law firm experience and average performance in law school placed in a major New York City law firm. This would be unheard of in a normal market.
• A finance attorney from a top 50 law school, who had four law firm jobs in four years was placed with a major international law firm in another part of the world (their fifth job in five years) after a 45-minute phone interview. This would be unheard of in a normal market.
• I placed several very senior (30+ years of experience) patent prosecutors with minimal to no business in new firms around the country. This would be unheard of in a normal market.
• I placed at least ten patent prosecution attorneys from third-tier law schools and small law firms into much larger ones-in most cases relocating them. Many of these patent prosecutors had never worked in a law firm of more than ten attorneys. This would never have happened in most normal markets.
• I placed several trademark attorneys-including at least one with 8+ years of experience. This would never have happened in a normal market as well.
• I placed several federal clerks coming out of clerkships-notably, several out of the United States Court of Appeal who were on their second or third clerkships. What made these placements notable was that most of them had never worked in a law firm-even as a summer associate and a few were in their mid-30s. This would never have happened in a normal market.
• I placed several attorneys out of government jobs, with zero law firm experience in major law firms. This would never have happened in a normal market.
• I successfully relocated several very senior attorneys with no business in a variety of practice areas to small markets (Salt Lake City, Portland, Milwaukee, Orlando, Long Island, Maine, Vermont, Rochester, Albany, Grand Rapids, Sacramento-and many more). In fact, niche markets were extremely busy. This would never have happened in a normal market.
• Numerous senior attorneys in practice areas such as litigation, environmental, executive compensation, bankruptcy, and others were placed in law firms. This would never have happened in a normal market.
• Several attorneys were placed from major law firms to very small boutique law firms. Smaller law firms typically never used legal recruiters in the past-now many are doing so.
• I worked with three separate solo practitioners attorneys in their 70s (one in his late 70s) that I was able to get offers for with established, larger law firms. This was unusual and never would have happened in a normal market.

Our activity throughout the year was a virtual firestorm of placements with several of our recruiters making multiple placements in a given week. Even during the week before Christmas, we were continually getting interviews and offers (in what is almost always a slow part of the year). In the week between Christmas and New Year's, we even made a few [unexpected] placements and had several interviews scheduled. Law firms sent us numerous jobs the week before Christmas and the week before New Year's as well.

For the 2017 calendar year, each of our recruiters collectively averaged 30% more placements than in the prior year. I made 40% more placements and took six months off during which I wrote a book about diversity. Read the book here: Law Firm Diversity: How Race, Gender, Age, Social and Economic Divisions Impact the Hiring, Retention and Advancement of Law Firm Attorneys. The market was very hungry for the right sort of attorneys-but with several caveats.

Despite all of this activity, the sorts of placements we were making and the competitive landscape have changed a great deal. Placement activity has been moving away from many of the larger firms to smaller law firms.

• The largest law firms have become more competitive places to make placements in. These law firms are more difficult for lateral attorneys to get positions in and have become better at understanding the sorts of attorneys that are likely to be more committed to the practice of law than they were in the past. See The #1 Attorney Career Killer That Attorneys Are Never Taught for more information. The largest law firms in major cities (New York; Washington, DC; and San Francisco) are more difficult to get positions in than they have ever been. The bar continually goes up in regard to how difficult it is to get positions in the largest, most competitive law firms-except for some attorneys in niche practice areas. Attorneys that confine their job searches to the largest law firms do so at their peril because there is a lot more opportunity in smaller to mid-sized law firms.
• There is more demand in smaller to mid-sized law firms for attorneys. Smaller to mid-sized firms are becoming very busy. Countless smaller to mid-sized firms are using legal recruiters for the first time. Our phones in our offices were ringing with multiple calls per day from small to mid-sized law firms that were seeking attorneys. This activity was something we have never seen before. Smaller to mid-sized law firms are getting very busy and are seeking talent. As they remain interested in hiring new attorneys, they continue to reach out to us for assistance. This is a welcome development: Many millennials are more interested in smaller law firms, and they are going to these law firms.
• Lots of new law firms are starting and becoming very successful out of the gate. Over the past year, I saw several smaller law firms start and become quite successful right out of the gate. I spoke with several law firms that were less than three years old, have fewer than ten attorneys and were already generating tens of millions of dollars a year. While I have certainly seen this sort of thing in the past, there seems to be much more entrepreneurial activity with more law firm start-ups in the market than there have ever been.
• Markets outside of major cities are also becoming far busier than they have ever been. We have seen a lot of activity in smaller to mid-sized cities-particularly those outside of large cities. This is an indicator that there is not enough talent in these markets as well. In slow legal markets, there is traditionally plenty of talent to go around even in smaller markets. In good legal markets, there is not enough talent in smaller markets, and law firms hire from outside of the market. In 2017, we placed several attorneys in new markets, and this indicates that the overall market is getting much better.
• Corporate activity in major markets is slowing down going into 2018 and there are not a lot of openings. Concerning corporate, the slowdown was substantial enough towards the end of 2018-and the absence of new openings in many major markets (outside of Silicon Valley) notable enough, that there are some indications that there might be an overall market correction and slowdown in 2018. The presence of a robust corporate market has traditionally been an indicator of a healthy legal market overall. Here, the slowdown is meaningful because it does not show an expansion of this sector but, instead, indicates that it appears to be slowing down-or at least leveling off. Whenever I have seen this before, an overall slowdown in the market has followed shortly after that. While the market for corporate attorneys typically tracks a rising stock market (which we saw throughout 2017), something is going on that is driving a slowdown in corporate positions in major law firms and I am not sure what this is.
• Litigation has increased significantly. Litigation had its best year on record. There was significant demand for litigators. Most of this demand, however, was not from major law firms. Major law firms have not been actively hiring litigators-most of the activity appears to be occurring with smaller to mid-sized law firms. All across the country, our recruiters were busy making placements in smaller law firms. One area where there was not a lot of placement activity for attorneys who are litigators was in New York City. The West Coast, Chicago, and other areas of the country were busy.

Read the full report for an in-depth breakdown of the health and outlook of over 30 practice areas in 2018: http://bcgs.li/W5X1E

About the Author

Harrison Barnes has one true passion: getting lawyers jobs. His tireless drive to succeed, his extensive contacts in the legal world, and his uncanny ability to draw out the best in his candidates have made him one of the most sought-out, respected legal recruiters in history. His company, BCG Attorney Search, places more attorneys in law firm jobs than any recruiting firm in the world.

Harrison Barnes is also the founder and CEO of The Employment Research Institute, an umbrella of 500 job search websites, employment publications, placement firms, and companies. The institute employs several hundred people and is headquartered in Pasadena, California.

A prolific writer in his own right, Mr. Barnes pens a daily career blog that circulates to 800,000 readers. He has published numerous books and is a frequent lecturer on recruiting issues. He cares about his candidates and genuinely wants to help them find fulfillment in every aspect of their lives.