Law360 released results from its fifth annual Diversity Snapshot, which surveyed 300 law firms on their minority representation at the non-partner and partner level. According to Law360’s report, minorities make up 16.4% of all attorneys and 9.5% of partners in law firms across the country. Firms with the highest levels of minority attorneys offered benefits including formal mentorship programs, business marketing workshops, and integration into the firm’s community at large, the report revealed.
In the biggest category of ‘Big Law’ firms (600+ attorneys), Wilson Sonsini tops the list as the largest firm with the most minority lawyers this year, with 20.4% minority equity partners. Additional ‘Big Law’ firms with the highest percentage of minority attorneys included Morrison & Foerster (17.3%), Paul Hastings (13.8%), and Cleary Gottlieb (13.1%). For medium to large sized firms (300-599 attorneys), the top firms for minorities included Fragomen, Del Rey (23.5%), Fenwick & West (13.8%), and Shearman & Sterling (13.2%). For the smallest sized firms (150-299 attorneys), the best firms for minorities were Atkinson Andelson (32.1%), Best Best & Krieger (23.2%), and Munger Tolles (19.0%).
“The top firms in each size category have demonstrable diversity levels of at least 20% of all attorneys at the firm, creating examples of what a more diverse and more inclusive workforce can look like” Law360 notes. “It’s no secret that the legal industry is one of the least diverse professions in the country. But some law firms have made notable progress, and the firms listed are making some headway and turning longstanding diversity goals into workplace realities,” (as quoted in Law360).
See the full article and rankings on Law360.
Contact Bill Sugarman for more information.
The National Law Journal released its annual NLJ 500 rankings, which analyzes data on the largest law firms by headcount. According to the report, the number of lawyers in the NLJ 500 grew 2.5% in 2018 to 169,477, and the average firm size rose by eight lawyers last year to 339. By comparison, the NLJ 500 grew by 1% in 2017 and by about 2% in 2016. Partnerships expanded by just over 1% last year, driven by non-equity partnership growth of 3.8% in 2018, the report also revealed.
According to the report, three firms in the top ten saw upward movement, including Latham & Watkins, Kirkland & Ellis, and Morgan Lewis. New York, Washington D.C., Chicago, Los Angeles and Boston were the top cities with the most lawyers in this year’s listing. Additionally, one group that showed unexpected growth in the 2019 National Law Journal rankings was the category of “other” lawyers, which encompasses counsel, senior attorneys, of counsel and staff attorneys. This cohort showed a net gain of 1,171 lawyers—up 6.4% in 2018. That’s compared to a net gain of 99 lawyers, or just 0.5%, in 2017.
“The 2019 NLJ 500 tells the story of more growth in 2018 than we saw in the previous two years,” said Lisa Helem, Editor-in-Chief, The National Law Journal. “Overall, the 2019 NLJ 500 findings, especially at the top of the list, along with profit increases for much of the Am Law 200, reflect an industry enjoying rising demand and faster growth. The average head count increase—still in the low single digits—is a far cry from the 4% or 5% growth firms saw in the pre-recession period from 2005 to 2008. But given the ugly contraction that followed, there’s something to be said for this year’s more modest gains,” (as quoted in The National Law Journal).
See more highlights from NLJ 500 rankings on The National Law Journal.
Contact Bill Sugarman, a legal recruiter, for more information.
The American Lawyer published results from its annual Am Law 200 report, which includes data and rankings for the nation’s Second Hundred highest grossing law firms. Overall, gross revenue increased on average by 3.1 percent, net income grew by 2.9 percent, profit per equity partner grew by 2.8 percent, revenue per lawyer increased 1.6 percent, and overall headcount rose 1.5 percent. According to the report, eleven Second Hundred firms saw double-digit revenue growth and thirty-eight firms saw revenue increase more than five percent.
The 2019 Am Law 200 report shows a tempered version of the financial strength demonstrated by the Am Law 100 notes Gina Passarella, Editor-in-Chief of The American Lawyer and ALM’s Global Legal Brands. “Firms, on average, performed well, but the growth was significantly less than what the first 100 firms experienced, highlighting the added pressures faced by smaller firms with less differentiation. In that sense, the Am Law 100’s better performance in 2018 is emblematic of another feature of that larger group: greater historical volatility. Second Hundred managing partners need not look upon that with envy,” (as quoted in The American Lawyer).
See more highlights from The Am Law 200 on The American Lawyer.
Contact Bill Sugarman for more information.
Law360 released its sixth annual Glass Ceiling Report, which surveyed 300 law firms on gender diversity and ranked firms based on the percentage of female equity partners in the United States. According to the report, women make up 36% of all attorneys and 25% of equity partners in law firms across the country. Firms with the highest levels of female equity partners tend to focus on building a clear pipeline to equity partnership for women and offer benefits like work schedule flexibility, mentorship programs and greater leadership opportunities in order to retain top-performing attorneys.
Among the 300 law firms surveyed, small firms (20-149 attorneys) had the highest percentage of female equity partners, including Sideman & Bancroft (63.6%), Culhane Meadows (60.0%), Brundo Testan (60.0%), Wilson Turner (55.6%) and Walsworth (50.0%).
For medium to large sized firms (150-599 attorneys), the top five best firms for female partners were Fragomen Del Rey (47.1%), Nossaman (42.9%), Hanson Bridgett (38.2%), Shipman & Goodwin (32.2%) and Best Best & Krieger (32.1%).
In the biggest category of ‘Big Law’ firms (600+ attorneys), Littler Mendelson tops the list of the biggest firms with the most female representation this year, with 29.6% female equity partners. Additional firms with the highest percentage of female equity partners include Jackson Lewis (28.3%), Faegre Baker Daniels (24.3%), Akerman (22.9%), and Ogletree Deakins (21.7%).
See highlights from the full article and rankings on Law360.
Subscription may be required to view the article
Contact Bill Sugarman for more information.
In a recent article, The American Lawyer takes a deep dive look at the strategies and practices of a small group of firms that have delivered year-over-year growth since the Great Recession. According to ALM Intelligence data, only 27 of the 100 firms on the Am Law rankings have had year-over-year growth in revenue since the 2009 fiscal year. To understand how a select group of firms turned the recession into an opportunity to thrive, not just survive, The American Lawyer spoke with a group of leaders who played a pivotal role in reimagining their firms’ trajectories.
So, what characteristics do these law firms have in common? Janet Stanton of law firm consultancy Adam Smith, Esq. elaborates on the subject, noting “They tend to operate in a more business-like way, which means a focus on profitability, intentional planning, strategic intake and succession planning for leadership roles and client management. From the 1980s to 2008, law land didn’t have to do any of these things, so these firms that are pulling away changed their strategy, notes Stanton. These firms have been able to get it right for nearly a decade, and each had to develop a unique strategy to make it happen,” (as quoted in The American Lawyer).
According to the article, the law firms that have delivered year-over-year growth since the 2009 fiscal year include: Akin Gump; Baker & Hostetler; Barnes & Thornburg; Cooley; Davis Polk; Duane Morris; Fox Rothschild; Fragomen; Gibson Dunn; Goodwin Procter; Holland & Knight; Jackson Lewis; King & Spalding; Kirkland & Ellis; Latham & Watkins; McGuireWoods; Milbank; Morgan Lewis; Ogletree Deakins; Paul Weiss; Perkins Coie; Polsinelli; Proskauer Rose; Ropes & Gray; Sheppard Mullin; Simpson Thacher; and Williams & Connolly.
See highlights from the full article on The American Lawyer.
Contact Bill Sugarman for more information.
The American Lawyer released their 32nd annual Am Law 100 report, which includes data and rankings for the nation’s 100 highest grossing law firms. Overall, gross revenue grew by 8 percent in 2018, coming in at a record breaking $98.7 billion. Additionally, net income increased by 7.8 percent, profit per equity partner grew by 6.5 percent, revenue per lawyer moved up 4.2 percent, and total attorney headcount rose 3.6 percent.
According to the report, thirty-seven firms posted gross revenue over $1 billion in 2018, six more law firms than in 2017. Additionally, ninety-three firms reported gains in revenue, up from 85 firms last year. For 2018, the top 10 firms accounted for 26 percent of the Am Law 100’s total revenue. The next 17 firms accounted for the next 25 percent of revenue. Firms No. 28 thru 53 accounted for another quarter of the revenue, and the final 47 firms generated the remaining 24 percent of the total Am Law 100 firms, (as quoted in The American Lawyer).
For the second straight year, Kirkland & Ellis landed the No. 1 spot as the highest grossing law firm in 2018, with $3.757 billion in revenue, up 18.7% from 2017. Latham & Watkins remained in the No. 2 spot, rising 10.5% in total revenue to $3.386 billion. Baker & McKenzie retained the No. 3 spot, with $2.900 billion in revenue. DLA Piper remained in its respective spot from last year coming in at No. 4 with $2.836 billion. Skadden Arps claimed the No. 5 spot, up 3.5 percent to 2.673 billion in 2018.
See more highlights from The Am Law 100 on The American Lawyer.
Contact Bill Sugarman for more information.
The U.S. legal industry climbed to 1,142,700 jobs last month, returning to last year’s highwater mark set in October, according to recent data released by The U.S. Department of Labor’s Bureau of Labor Statistics on Law360. Professional and business services, which includes the legal sector, showed stronger gains, adding 42,000 jobs last month, in line with the average monthly gains for those services over the past 12 months, the report said.
In addition, some other recent reports indicate that the legal industry as a whole is performing well financially. One report, released in late January by Wells Fargo Private Bank’s legal specialty group, in a check-in on 2018’s year-end results found the strongest annual performance among law firms in a decade, with firms reporting average revenue growth of 5.9 percent and average net income growth of 7.6 percent.
That was consistent with another report published in December by Citi Private Bank Law Firm Group and Hildebrandt Consulting, which found that last year was the U.S. legal industry’s best for financial growth in nearly 10 years, Law360 reports. According to the report, law firm revenues during the first nine months of 2018 grew by 6.3 percent on average, due to increases in billing rates and, to a lesser degree, demand growth.
The Citi report was generally optimistic about the industry’s outlook for 2019, predicting that law firms will become more adept at using technology, project management and alternative pricing to become more efficient. It also predicted an uptick in equity partner retirements, putting the onus on firms to invest more time and energy into client transitioning.
“We are optimistic about 2019 and do not anticipate a downturn in the industry. When the inevitable downturn does occur, the biggest expense management opportunity for firms will be to study whether the composition of their leverage models makes sense from a profitability standpoint,” Brad Hildebrandt, chairman of Hildebrandt Consulting, said in a statement at the time the report was released. “That said, experience tells us that law firms are typically quick to recover from economic downturns, so long as their internal fundamentals are sound,” (as quoted in Law360).
See highlights from the full article on Law360.
Contact Bill Sugarman for more information.
Buoyed by a strong economy and expectations of continued growth in demand, the increasingly dynamic lateral market shows no signs of slowing in 2019, Law360 reports in a recent article. According to a report released by Citi Private Bank Law Firm Group and Hildebrandt Consulting, the lateral market had been the “primary driver of consolidation in the legal industry” in 2017 and 2018. During both of those years, the report found, lateral recruiting outpaced internal promotions, and that trend was unlikely to reverse in the near future.
In the article, Law360 reflects on the most effective hiring and integration strategies for attracting and retaining top talent at the fastest growing law firms in 2018. According to the article, law firm leaders at the most actively hiring firms identified a variety of strategies aimed at improving lateral hiring including seizing on opportunities from potentially flagging firms and building a competitive platform that integrates new talent and retains them for the long haul. Managing Partner of Akerman Scott Meyers weighs in on the success of the firm’s tactical lateral hiring strategies, which attributed to 47 lateral partners last year. According to Meyers, “None of this growth has been in the mold of, ‘If we build it, they will come,’ It’s been going to places where there is existing client demand, both in terms of geography as well as subject matter expertise,” (as quoted in Law360).
Another firm featured in Law360’s article was Kansas City-based Polsinelli, which also brought on 47 lateral partners in 2018. Polsinelli chairman and CEO Chase Simmons attributes its lateral growth to the firm’s 10-year focus on growing its bench in certain core practice areas, namely, real estate, financial services, mid-market corporate work, intellectual property and health care, as well as adjacent litigation and labor and employment matters. “We’re looking for people that fit culturally. If we see an opportunity that’s off-strategy, we’ll consider it,” notes Simmons. “We’re large enough as a firm that we can always be considering a few things that are maybe not right down the middle of what we’ve done in the past, but we know that that’s a different process,” (as quoted in Law360).
See highlights from the full article on Law360.
Contact Bill Sugarman for more information.
The American Lawyer reports that law firm demand in 2018 was the highest on record since 2011, according to a recent report by Thomson Reuters. Further amplifying evidence that law firms, especially the largest, reached new financials highs in 2018. Another report, conducted by Citi Private Bank’s Law Firm Group, found that revenue growth was up 6.4 percent at the 191 firms surveyed by the bank. And in the last two weeks, Wells Fargo reported average law firm revenue growth at 5.9 percent and average net income growth at 7.6 percent, the strongest numbers since before the Great Recession.
Thompson Reuters report specifically revealed that law firm demand, billing rates and lawyer productivity all rose during the year. According to the analysis, demand, measured as the number of hours billed, rose 1 percent for the year among all firms. Among the Am Law 100 firms, that number was 2.8 percent. Am Law Second Hundred firms and midsize firms saw demand growth in 2018 of 0.4 percent and 0.2 percent, respectively. The Am Law 100 was the only segment of firms that saw demand growth in all four quarters of the year, the report found, (as quoted in The American Lawyer).
Fortunately for smaller firms, rate growth was more evenly distributed, the report notes. The Am Law 100 saw rates grow 3.8 percent in 2018, compared to 2.9 percent for firms in the Second Hundred and midsize categories. The report also notes that Am Law 100 firms were the only segment of firms to show positive full-year growth in productivity, which measures hours worked per lawyer. The 100 largest firms by revenue grew productivity in 2018 by 0.8 percent, while that figure was flat at Second Hundred and midsize firms, (as quoted in The American Lawyer).
Mike Abbott, a Thomson Reuters vice president for enterprise thought leadership and content strategy, said that while 2018 was a banner year for law firms— especially the nation’s largest—there remains uncertainty around 2019, especially after the fourth quarter was somewhat softer than earlier quarters. “Whether the tailwinds will continue in 2019 remains to be seen, as client rate pressure and a shifting competitive landscape for legal services continue to pose challenges,” Abbott said in a statement. “And while the entire market was improved in 2018, we saw an increasingly segmented market where the very largest firms gathered the lion’s share of the gains last year.”
See highlights from the full article on The American Lawyer.
Contact Bill Sugarman for more information.