NEW YORK Dec. 4, 2005- LAWFUEL – The Law News Network -The American Lawyer(R) reported today that managing partners of the nation’s largest law firms are bullish on their prospects for the upcoming year, predicting that their revenue and profit increases will outpace the economy in 2006. Almost half of the respondents plan to raise billing rates more than five percent and 68 percent expect profits per partner to increase by more than five percent. But, the leaders surveyed continued to lament growing discontent among the younger associates who drive firm billings. These and other results from the magazine’s annual survey of Am Law 200(R) law firm leaders are featured in the December issue of The American Lawyer, available beginning today, and will be available on the Web at www.americanlawyer.com and www.law.com.
While managing partners expressed concern regarding associate turnover and low job satisfaction ratings, some associates see the problem as rooted in pay equity. Associate salary levels have been essentially frozen since 2000, while partner profits have steadily increased. Despite that fact, almost 40 percent of respondents said they do not plan to raise associate salaries next year.
Litigation is expected to remain the number one practice area, with 38 percent of respondents seeing it as next year’s fastest-growing practice area, while 30 percent cited corporate work. As a result, 47 percent of respondents expect litigation to be the most significant area for firm hiring.
“The largest U.S. law firms have proven remarkably resilient, growing in good times and bad. Their biggest challenge seems to be managing the war for talent. And most haven’t figured out a new approach,” said Aric Press, editor in chief of the magazine.
Despite their optimism, firms continue to manage their businesses conservatively, with only one-third of respondents planning to increase their hiring of first-year associates and with most firms carrying little or no debt. Almost 80 percent said five or fewer lawyers in the firm spend more than half their time on management, about the same proportion as in last year’s survey. And, although overseas outsourcing continues to grow in many sectors of American business, it has gained little headway among law firms. Ninety-four percent of respondents said they do not send work overseas and had no plan to do so.
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The American Lawyer is the legal industry’s leading monthly magazine. Read by partners at corporate law firms, in-house counsel, government lawyers, and litigators at firms of all sizes, its trailblazing features about attorneys and the work they do has led to 23 National Magazine Award nominations and five coveted awards for general excellence, essays and criticism, and single-topic issues. The magazine is published by ALM.
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Peters & Feldman for ALM
Lee Feldman, 802-366-9001