Much has been made of the economic crisis and its impact on the job market, but other than some anecdotal evidence (“Latham just made a capital call!” “Howard Rice is paying new associates to go away for a year.”), there hasn’t been much insight into the way jobs are being affected at top law firms.
Thanks to a recent article in the Sunday edition of The New York Times, we finally have a little knowledge on the subject. According to the article, Latham & Watkins decided to freeze associate salaries – a move that was emulated by several other major firms. This ends a cycle of escalating associate salaries that began in earnest during the early part of this decade as a recruitment and retention tool to both draw new attorneys to the firm and to keep junior and mid-level associates from jumping ship to either in-house legal jobs or more lucrative financial posts.
The good news is that salaries are not dropping (even though the retention needs have obviously softened – because what lucrative finance jobs are there to jump to?) and that the salary freeze actually seems to be fending off the more drastic move of cutting associates.
On balance, the news is pretty good. A JD from a top law school continues to show strong earning potential and a high level of job security. This certainly calls for another application increase during the next admissions cycle.