Post a CommentLaw Firm Layoffs and What to Do about Them, Part 1: Advice for Law Students
By Irene Hahn
4/22/2008 In the past year, a declining economy has led to a steady stream of associate layoffs in large law firms. Dechert, Thacher Proffitt, Cadwalader Wickersham & Taft, Edwards Angell Palmer & Dodge, O’Melveny & Myers, and Clifford Chance are among the firms that have laid off significant numbers of associates in the past year; the trend, in all likelihood, is not over. Obviously this is a concern for current law students looking to choose a firm, as well as associates in firms who might be wondering if they’re next. This post is the first in a two-part series about layoffs and what it means for your career. This week we have advice for law students; stay tuned next week for advice for Associates.
Know thy Firm: Evaluating a Firm for Job Security
As a law student going into fall recruiting, the best thing you can do for yourself during the job search is to talk to attorneys at the firms you’re interested in. Ask questions during your interviews. Call up contacts you may have through friends and peers. Use your alumni network. Don’t just rely on what’s reported in the news; law firms don’t like to reveal publicly that they’re laying people off, much less admit that business might be slow. Blogs such as Abovethelaw.com and Thelawyer.com can be useful for tracking attorney attrition—check back regularly, or subscribe to the blog if you want updates as soon as they come in. And while doing your research, be mindful of the following questions.
- Has this firm been laying people off lately? And if so, has the firm been re-purposing people to other departments, or have they let them go entirely? Some firms such as Clifford Chance have done their best to feed associates into other departments; other firms have not been as kind. Remember, however, that even those firms that place associates in other departments are not necessarily doing them a favor—if funneled into a tough department where they have to scramble to learn a new set of skills, these associates may be at risk of being laid off later “for cause.”
- Does the firm’s hiring and firing practices fall into any sort of pattern? Look at the firm’s history. What sorts of cycles have they had with hiring and firing in the past? For instance, do they bulk up on associates in good times, then slash them when things get tough? One thing you can ask in an interview is, “Do you have excess capacity?” If they do, your job may be at risk.
- Is the firm hiring laterals? If they are, chances are that there’s plenty of work available; firms won’t hire laterally unless they have work for those laterals to do.
- If they’re firing people, where are they firing? If the firm has been firing people but you want to work at the firm anyway, look at where they’re firing. If they’re firing people across the board, it might be best to stay away. If, on the other hand, they are firing only within specific practice areas, none of which interest you, it might be worth trying your luck there.
- How many partners have left the firm recently, and why? Partner attrition can be used as a barometer for gauging the health of a firm. If partners have been leaving, find out why. Is it that one partner got offered a job as a managing partner somewhere and took his two closest colleagues with him? Or were they just looking for any other job, at any other firm? Situation one would set up less of a red flag than situation two, which may be a sign of a firm under stress.
Know Thyself: Choosing a Practice Area, Evaluating Your Goals
Besides doing your homework on each firm, have a heart-to-heart with yourself and figure out what you want to get out of your job experience. Ask yourself, What kind of law do I want to practice? And how much risk am I willing to take on? Some practice areas, like real estate, are inherently more cyclical than others, and you need to be prepared for this if that’s the kind of law you want to practice.
In terms of the current legal climate, if you want to do litigation, job security probably won’t be a problem, at least for now—litigation is hot, particularly in IP. Corporate practices, on the other hand, are suffering. Many firms have taken hits in their capital markets and real estate practices; Structured Finance at Clifford Chance, Finance and Real Estate at Dechert, and Structured Finance and Real Estate at Thacher Proffitt all laid off Associates this past year.
If you’re intent on moving into a particular practice area then you should do what you like, but if you’re really not sure and value job security, then look at which practice areas are hiring. In an economic downturn, for instance, bankruptcy work will be brisk. Do make sure, however, that you only pick a practice area you’re actually interested in. If you’re going to be miserable, then no amount of risk will make it worth it for you.
Besides your practice area, ask yourself, What are my short-term and long-term goals? In general, law students tend to fall into two categories when it comes to choosing firms. Some students want a job at the most prestigious firm possible. These students plan on working there for 2-3 years, just long enough to get some legal experience and boost their resume, and will ultimately move into another job, not necessarily at a firm. Other students want to work at a mid-tier firm straight away, with the intention of one day making partner. Your long-term and short-term goals will figure into the calculation, so it’s a good idea to think about it early, before you’ve picked a firm.
What To Do If You’re Not Getting Offers
Even if you’re diligent with your research, it may be that you still don’t get offers in the practice area that you’re looking for. If this happens, don’t panic and look into your alternatives. If you were thinking you’d go in-house eventually after working at a firm for a couple years, maybe the time to go in-house is now. Alternately, consider spending two years getting non-traditional legal experience to best position yourself for a job when the market picks up. So for instance, try working in the financial crimes section of the District Attorney’s office or the US Attorney’s office, or going in-house in a state government office. Another option is Attorney General offices. Though traditionally looked down upon, their caché is rising, particularly now that the recent Mark Spitzer fiasco has brought them into the spotlight.
If government isn’t your cup of tea, there are plenty of jobs in finance, insurance, or banking to chase down. Enter one of those areas, and in two years you will have the knowledge and experience to make you an attractive candidate to law firms. Public interest jobs or clerkships are also great options—granted that they don’t pay firm salaries, but the important thing is getting legal experience so that you can make yourself competitive once the legal market improves.
If you strongly prefer working in a firm but can find nothing domestically, consider working in a foreign office, either of a U.S. firm or a foreign firm—Brazil, India, China, and Japan are just some of the countries with strong legal markets. Plus, you get to explore another country, while gaining international experience that will great on your resume.
The views expressed in this article are solely the views of the author and not LexisNexis. Return to Building a Better Legal ProfessionBack to top
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