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Recently we tuned into a very interesting (albeit somewhat depressing) conference call, Staying Competitive During an Economic Downturn,
sponsored by the National LGBT Bar Association. Three experts provided
their thoughts on the current legal job market and advice for
navigating it:
Robert Depew.
A Managing Director in Major, Lindsey & Africa's San Francisco
office, Depew helps lawyers evaluate career alternatives and places
attorneys at top tier law firms and select in-house positions in the
Bay Area.
Christopher LaFon.
As director of recruiting at Kelly Law Registry, one of the nation's
largest job placement firms, LaFon builds careers and aids in career
transitions for attorneys, paralegals and other legal professionals.
James Leipold.
The Executive Director of the National Association for Law Placement
(NALP), Leipold helms the legal profession's leading association
dedicated to research, education and career development.
When will the legal economy return to normal? What can laid-off
lawyers do while they wait for recovery? Is there any hope, for any of
us?
Find out the views of the experts, after the jump.
Here's a rough write-up of the discussion. Please consider these
remarks to be paraphrased (unless otherwise indicated, with quotation
marks).
The call began with James Leipold of NALP offering an overview of
the legal market (which should be familiar to regular readers of ATL;
but Leipold's summary was especially clear and concise). He was
followed by Robert Depew and Christopher LaFon, who offered advice for
dealing with the grim realities. The call concluded with a
question-and-answer session.
JIM LEIPOLD: Unfortunately it's my job to start
this phone call delivering the bad news. Everyone knows the legal
economy is very difficult right now. Unemployment recently reached a 25-year high, 9.4%, and the legal sector has seen proportionate job losses.
The slowdown has hit the largest law firms in the largest markets hardest. Some smaller firms in smaller markets are thriving.
How long will this state of affairs last? "Financial institutions
advising law firms are predicting a difficult economy through calendar
year 2009, and perhaps longer than that."
Things were already tough late in 2008. By the end of calendar year
2008, law firms were having a hard time with collections, and corporate
work was drying up. At the start of 2009, it was very difficult for law
firms to obtain the credit they need for their operations.
Law firms are under tremendous pressure to bring down their
expenses, largely through reducing headcount. But they're also taking
other measures, from cutting discretionary travel to trimming bonuses.
In 2009, some firms announced salary freezes and salary cuts.
The biggest impact is being felt by recent graduates. Students just
finishing law school face a particularly difficult legal job market.
Class of 2009 graduates are seeing start dates deferred
for as long as a year. There's a collision in the marketplace between
graduates from 2006-2008, who are competing with jobs for the class of
2009, and soon the classes of 2010 and 2011.
The recent changes should be viewed in context. We've been part of
an industry that has had a remarkably robust 7 to 10 year run. The
class of 2007 had a 92 percent employment rate after graduation, an
all-time historical high. Starting salaries also reached a new high.
At NALP, we expect the employment rate for the next several classes
to fall into the mid 80-range. But it shouldn't go as low as it did for
the class of 1993 (83.4%).
The news isn't all bad. Small and midsize firms that have lower
price points are doing quite well in some markets, from Detroit to St.
Louis. These firms are actually growing in some cases, because they're
seeing credentials from laterals and new associates they didn't see in
the past. There is tremendous pressure in corporate America to reduce
total legal spend, so work is flowing down to smaller firms and smaller
markets.
The legal hiring market in the public interest arena is very difficult. Many public interest groups are funded through IOLTA
funds -- escrow funds held for clients that generate interest, with the
interest being used to fund civil legal services. Because interest
rates have fallen to near zero, the IOLTA funding mechanism has
collapsed.
Many public interest groups have had layoffs, furloughs, and pay
freezes. Into this mix you add deferred associates, bearing stipends
from their firms. Although it's commendable of firms to support public
interest, deferred associates are displacing lawyers who trained for
three or so years in preparation for a move to public interest. So
there has been a fair amount of disruption to the public interest legal
market as well.
Is this just a temporary blip? Probably not: "The large law firm
model is undergoing a period of structural change as a result of this
economy, in a way that suggests that things will not return to normal
after this is over." For example, we probably won't see a resumption of
the practice of large law firms hiring large classes of summer
associates two years out.
One benefit is that you're seeing experimentation in terms of new models. For example, one firm in Philadelphia
has announced that it will take new lawyers on a for a six-month
mini-apprenticeship of sorts: the lawyers will be paid less than market
for the first six months, during which they will focus on training and
learning, and their salaries will be escalated over time.
When will things get back to normal? NALP doesn't expect a return to
a normalized legal market until probably 2012 -- and it's uncertain
what "normal" will look like then.
ROBERT DEPEW: My goal is to pass along advice to people who have survived layoffs or are worried about layoffs.
A mentor of mine told me in law school: As an attorney, you have a
brand. You are your own brand. You build, market, and protect your own
brand. You're looking out for the profit of it and the reputation of
it. It travels with you throughout every interaction and case that you
work on. Think about your career development as something you need to
be strategic about. You need to have goals and think about where you
want to be.
My first word of advice is to be professional in everything you do.
Any written work that you do should be client-ready when you turn it
over for review. The first people to be let go are people who have
submitted questionable work product or work that was less than their
best.
Second, be productive. Law firms value billable hours. It's the
structure firms are based on. There's no escaping this. Firms reducing
headcount will focus on who is least productive.
This is easier said than done when work is hard to come by. Be
proactive. Make sure colleagues know you have time available. Ask them
for advice on how to use your time productively.
Take on meaningful pro bono work. But be conscious of the fact that
it isn't generating revenue for the firm. Even firms that treat pro
bono work as "billable" don't give it the same weight as work that
generates money for the firm.
Be flexible about the kind of attorney you want to be. "Hold your
dream loosely." Let's say you want to be a transactional attorney.
Unfortunately, there are very few opportunities to do corporate work
right now. Maybe you'll have to do restructuring or bankruptcy work
that might help you transition back to corporate work later.
Don't be shy about selling yourself. The emphasis on salesmanship in
the legal profession often disproportionately affects minority and
female and LGBT lawyers. Don't brag, but do take the opportunity to
share your sense of pride and accomplishment with senior colleagues.
Develop and maintain mentor relationships -- with attorneys you work
with, or attorneys you know in other contexts, like bar associations.
Try to find mentors who are five to 20 years ahead of you in their
career path. These are relationships that will follow you throughout
your career.
Networking is key to career advancement. Explore your local bar
associations, state bar associations, affinity bar associations, and
national and local LGBT bar associations. Pick one organization and
volunteer or try to find a leadership position.
Finally, remember to be nice. Be likable. Treat everyone you work with with respect.
CHRISTOPHER LAFON: Approach the job search process
with a sense of how you're marketing yourself. If you're trying to
transition into a new field, tweak your resume to emphasize experience
relevant to that field.
To the extent that you can get yourself into a mental state where
you can buy into what you're doing, you'll be able to sell yourself
more effectively. You have to believe it in order to sell it.
Go to in-person events. Be positive. Realize that what you might
have to do right now to get by -- say, contract work -- is temporary.
This too shall pass.
QUESTION AND ANSWER SESSION
Is this downturn affecting minorities / women / LGBT individuals more than the rest of the profession?
LEIPOLD: It's a question that's on everyone's mind. NALP held its
annual diversity summit last week, and participants expressed a
perception that layoffs have disproportionately affected women and
minorities. It is too soon to know in a quantitative way is true. But
the fact that there is this perception is important in and of itself.
Minority communities are feeling beleaguered or disproportionately
affected.
Are minority lawyers affected disproportionately because they are younger or more junior?
LEIPOLD: It's not clear that young lawyers are being hardest hit by
layoffs. Some firms have been making deep cuts to the ranks of fairly
senior lawyers, including non-equity partners.
Members of the LGBT community are not the most vulnerable because we
can "pass." Women of color are probably the most vulnerable -- and have
been for some time.
Given the economy, do firms still value diversity?
LEIPOLD: This is a real litmus test for whether diversity is a core
value. Law firms absolutely have to cut their expenses across the
board. We've seen a disproportionate number of diversity directors
losing their jobs as compared to recruiting directors losing their jobs.
Anything that's discretionary is being scrutinized carefully. And some law firms see diversity as discretionary.
How can I highlight my diversity on my resume?
DEPEW: Be a member of an affinity bar association, like an LGBT bar.
LEIPOLD: Highlight pro bono activities related to a minority
community. Also, business development is key. Your membership in your
community can create opportunities.
LAFON: Another benefit of volunteer work: you won't have as big an experience block on your resume.
LEIPOLD: Well, one of the benefits of this downturn is that gaps in
your resume are more understandable. There's no shame in taking a job
that lets you pay the bills, while you also do volunteer work.
What practices are recession proof?
LEIPOLD: The only true one is bankruptcy. Bankruptcy is booming. The
other historically countercyclical practice, litigation, has proved to
be less resilient. This is partly because litigation was changing even
before the recession in terms of its profitability, due to developments
like alternate dispute resolution. Regulatory litigation has picked up;
securities litigation has picked up, a little less.
The federal government has been hiring -- not necessarily entry-level lawyers, but some lawyers who have been displaced.
DEPEW: Labor and employment has been busy. It has been picking up.
What other parts of the country are seeing better employment rates?
LEIPOLD: New York and San Francisco have been hard hit. So has Chicago,
belatedly. Some cities, like Minneapolis and Dallas, have done better.
In general, the smaller the market, the better the market.
The same goes for firms. The Am Law 200 have proved to be more resilient than the Am Law 100.
Often members of our community [the LGBT community] want to head to
bigger cities -- they're safe, they have larger LGBT communities. But
I'd urge you to think about whether that can be deferred and whether
you can ride this out in a smaller market where there are jobs.
DEPEW: You're better off in markets that don't depend on financial
services. Charlotte is a small market, but it has been decimated.
When will this end?
LEIPOLD: The legal sector is often a leading economic indicator. Law
firms are one of the first sectors to see increased activity when
economy turns around. It's hard to start a company or do an IPO without
hiring lawyers.
In the large law firm world, people are talking about a return to
something like normal in 2012. A caveat: the "normal" will be different
from what we left behind. In the financial press, the predictions for
the general economy is that recovery is not likely to be sudden and
dramatic, but gradual over a period of years. The problem is that
global economy has been weakened in so many different areas.
DEPEW: The layoffs have been fueled in part by the virtual lack of
attrition. Folks who might have otherwise moved to a secondary market
or left the practice of law, people in years 3-8 of practice, did not.
In an act of self-preservation and fear, they decided to stay where
they are. But firms expected and planned for high attrition, which
didn't happen. Hence layoffs.
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In closing, Jim Leipold directed everyone's attention this free webinar, Managing a Legal Career Transition in Tough Times, put out by NALP and ALI-ABA. You can check it out here.
Job Prospects for Attorneys in a Difficult Economy [National Lesbian, Gay, Bisexual, and Transgender (LGBT) Bar Association]
Managing a Legal Career Transition in Tough Times [NALP]
Abovethelaw.com
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