I think sites like Abovethelaw are making it worse. Firms think it's okay to lay people off like crazy because everyone else is doing it. I like the transparency ATL gives associates, but think it is ironically starting to work against us.
in seems like the axe if falling in every practice group (not just corporate)....I am a second year in Chicago. It seems like there is not a project to go around
Very sorry to hear that, 4:33. Hopefully you've at least had the opportunity to get some good experience so far. I know a few first years who haven't gotten to do much of anything; if they're laid off, they'll really have nothing to hang their hat on. Tough situation for everyone...hopefully things turn around soon.
Things are not AS bad as it seems. Lit at my firm is busy as ever, and provides, I think, a decent balance to the cap markets and private equity practices.
I think sites like ATL are especially helpful during normal economic times. When the economy is stable, ATL and the like ensure that firms are held accountable for their actions. Firms, afraid of how layoffs and decreased perks will affect recruiting, think twice before taking actions that detrimentally affect associates.
However, in today's recession, layoffs, salary freezes and decreased benefits have become the norm. ATL is no longer there to hold firm's accountable for their actions- such accountability is now impossible. These drastic actions taken by Firms are the unfortunate reality of today's economic environment. Instead, all ATL does is add to the mass panic of Big Law associates and law students.
I think the salary reduction is a good general idea of how the market is shifting---non-NY based firms really cannot justify a 160K salary for a first year associate
I think hat 5:22 has a point that it is tough to justify equal salaries across the board for associates in every city. Maybe a lot less people would be let go if base salaries had a better COL adjustment? I don't know.
I am convinced that NY has the undisputed highest cost of living--at least with respect to its peer cities.
What scares me more than anything about the slew of bad news on ATL, is that law firms are particularly privy to the state of the economy. The bottom line is, at least arguably, that widespread firm layoffs reflect a consensus that the poor economic outlook is here to stay. Another possibility is that firms over-hired in past years, etc.
But assuming the layoffs are driven by pervasive pessimism, this will have a domino effect. With transparency about what other firms are doing, those that had positive outlooks now know that their competitors are considerably less optimistic; that has to change management at least somewhat, I'd think.
The WSJ ran an article today saying that over the next year, roughly 2.2 million jobs will be lost.
By my count, 893 lay offs happened today in the legal community. That is, those that were published.
this is not going to get better any time soon. I can only hope that the economy picks up come september/october when firms start extending permanent offers. But I guess there is nothing I can do about that.
Our goal is not to perpetuate the negativity, but we cannot stay true to our objective of providing a law student's perspective to legal employment, law school and legal issues without paying heed to the unfortunate reality the legal profession and, more broadly, all Americans are now facing.
At least to the extent our posts concern employment. And, for what it's worth, our most popular posts in our short blogging history have related to the legal hiring market.
Obama is going to drive this economy futher into the ground with his wreckless spending bill (disguised as a 'stimulus bill'). We're going to 10% unemployment.
i think all of this is going to profoundly change current law students' attitudes toward employment, especially since this will be most people's first jobs. If we were hired a few years ago, most get ingrained w/ an attitude of entitlement.
I won't purport to speak for all law students, but I'll say this: I personally do not feel entitled to a full-time position at the firm I'll be spending my summer with. But, to be honest, I wouldn't have felt that way even in better economic times--I always try to put my best foot forward.
Agreed. I think that, while it may be true to pin that attitude on a few, there are a lot of legitimate hard workers who do not feel entitled to their positions...they just want to make a better life for themselves.
A cursory review suggests TARP money is only for financial institutions (http://en.wikipedia.org/wiki/Troubled_Assets_Relief_Program). This may be wrong, but who knows...
I cannot speak for others on this thread, but I honestly don't think that there is not work out there. I mean everyone I know at my firm is busy as ever (V30) in every practice group...there has to be something in common with the firms that are going belly up.
I think there is definitely still work, but it's going to firms smaller than BigLaw. I would guess that all those laid off today will eventually find jobs, albeit most likely lower-paying ones. As for entry-level lawyers, grads from lower-ranked schools are probably the ones that are gradually being pushed out of the market. Smaller firms are seeing so many more over-qualified applicants.
Wow, this is crazy--just got home from work and saw the "news" on ATL. It's hard to make sense of these lay-offs where I'm coming from: BigTex and MidTex have not had ANY lay-offs yet, no salary freezes, bonuses were paid, summer programs are still going forward. It feels a bit like living inside a bubble... I just don't know enough about the difference between NY-based BigLaw and Texas-based BigTex to understand if this bubble will burst, or if we'll make it through ok. My minimal understanding (or perhaps wishful thinking) is that BigTex is run a whole lot differently than BigLaw, and thus is a little more stable in this kind of economy.
9:42--I say that smaller firms may be hiring, because when I was just on the market recently after the Heller debacle, smaller to midsize firms were the only ones I could get interviews with. Yes, some small firms have closed shop, but other ones are inundated with work.
It has certainly been a scary day. I feel for all those affected by today's events. I am, nonetheless, trying to remain optimistic about the future of the legal profession. I would like to believe that the worst is over, but I doubt that's the case. Other professions were more immediately impacted by the economy, but the legal profession is often the last to be hit and the last to recover. Still, brighter days will come. But just how far away are they? And what will the damage be? Will BigLaw ever be the same?
10:27pm: My mid-size law firm is very busy right now, no layoffs as of yet, none in the future. I haven't heard of any layoffs in our area yet... and I'm talking about Michigan!
I was a senior associate (6th year) at a mid-to-large firm. Several of us between 5th and 7th year were let go late last year. The only openings right now in my practice area are for partners with fairly substantial books. I do feel for you guys in school right now. I don't have any idea how things will shake out, and I decided to take the opportunity (yes, I'm treating this layoff as an opportunity and not an obstacle) and leave lawyering for something different. I'm back doing my "old" job--the one I did before law school--and I'm starting a Ph.D program in the fall. The loans are in forbearance, and I'll probably never pay them off now. I'll do what I can, and that's just going to have to be enough. Thankfully, I never ran up any credit cards, never bought a house, never bought a car or anything like that. Keep ALL your skill sets current and just hang on. This situation will stabilize and you'll all be able to make some plans, set some goals and move ahead. It just might not be quite what you'd expected. And that could be a really GOOD thing.
You are fooling yourself if you think BigTex is not laying off associates...I know 3 associates personally who were laid of by my firm and they just laid me off this week...
This is the kind of mentality that i wish most law students would have. I think as a general matter that our profession needs to become less obsessed with entitlement, prestige, and risk aversion. There is an opportunity in every corner, and this downturn is not Armageddon.
Today is the day of reckoning; Friday the 13th! The President will have a stimulus plan to sign, but it won't be nearly enough to save the BigLaw clients.
Prediction: over 1300 3L offers rescinded, and 400 more attorneys axed. Staff reductions to follow. Happy St. Valentine's Day...
I'd really like to be a 1L or 2L right now. At least then I'd have a couple of years before the job search. As it is, I graduated, took and passed the CA bar precisely at the economic meltdown (results 11/08). My timing is extraordinary.
What bigtex law firm is laying off? I work for one and have friends at the major bigtex law firms and they say nobody at their firm has been laid off and there are no plans to do so. All of them are corporate associates and say they are decently busy as am I.
171, there are a couple of things that Texas has that make them more immune, not immune. Large Texas law firms are not run the same way as firms based out of New York. The factor most important in this current economy is leverage. Large Texas firms are usually leveraged 1 to 2 or less. Some of the NY firms are leveraged 1 to 4 or 1 to 5 even. This has several effects. The first being that when times are good Texas firms are going to make less PPP. They simply don't have enough bodies doing the work to drive that figure up. (However, their PPP are still about 1.3 million so I would take that). Another effect of being less leveraged is you don't have as many bodies sitting around without work to do in a downturn. Instead of each partner having to generate work for 5 other associates they only have to generate work for 1 or 2. That makes a big difference in this economy.
Another factor that we haven't seen yet (but most are stating that we are starting to see as the credit markets become unfrozen) is that downturns in the economy lead to a lot of deal activity in the energy industry. You have larger companies picking up smaller ones, etc. This has happened in every economic downturn over the past 80 years.
Finally, personally I work for a BigTex firm and while I was really slow in November and December work has picked up again. I'm billing quite a few hours and I don't know anybody who doesn't have full days of work to do in corporate.
2:20, it's usually because of the depressed value of companies during a downturn. Larger energy companies are able to pick off the smaller ones in downturns and be better positioned once the economy turns around.
7:40...it is true for other sectors. The problem is that banks, etc., are precisely the ones being hit hardest by this recession, and as you are probably aware, this is where a majority of NY Biglaw draws its business
2:09, interesting. I didn't notice that particular take on the crisis. I still think that the credit crunch has to have some effect on BigTex' and other markets' ability to draw sufficient capital to make these transactions. Or, is it just that these companies already have massive pockets already?
I don't understand why this is being excaserbated. We knew that the Magic Circle was having problems 8 months ago. I don't think it has any relation to domestic firms.
Undeniably believe that which you said. Your favorite reason appeared to be on the web the easiest thing to be aware of. I say to you, I definitely get irked while people think about worries that they plainly do not know about.
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I think sites like Abovethelaw are making it worse. Firms think it's okay to lay people off like crazy because everyone else is doing it. I like the transparency ATL gives associates, but think it is ironically starting to work against us.
ReplyDeleteWe will update independently through comments.
ReplyDelete@ 4:19 --
ReplyDeleteI think that is generally true for a lot of different things ATL illuminates. I think there are some good things that can come out of this though.
This comment has been removed by the author.
ReplyDeletethis sux...I am worried sick about my job. Still have 100K in loans and I don't know where to go from here.
ReplyDelete@ 4:28 --
ReplyDeleteHow slow are things really? What does it entail? As law students, it's hard for us to gauge what it means for work to be slow...
Hang in there...
Craig,
ReplyDeletein seems like the axe if falling in every practice group (not just corporate)....I am a second year in Chicago. It seems like there is not a project to go around
Very sorry to hear that, 4:33. Hopefully you've at least had the opportunity to get some good experience so far. I know a few first years who haven't gotten to do much of anything; if they're laid off, they'll really have nothing to hang their hat on. Tough situation for everyone...hopefully things turn around soon.
ReplyDeleteatl is like drudgereport for the legal profession...nothing but bad news anymore
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteThings are not AS bad as it seems. Lit at my firm is busy as ever, and provides, I think, a decent balance to the cap markets and private equity practices.
ReplyDeleteWhat city, 5:04? Things are terrible in my secondary market
ReplyDelete5;07, NY
ReplyDeleteI think sites like ATL are especially helpful during normal economic times. When the economy is stable, ATL and the like ensure that firms are held accountable for their actions. Firms, afraid of how layoffs and decreased perks will affect recruiting, think twice before taking actions that detrimentally affect associates.
ReplyDeleteHowever, in today's recession, layoffs, salary freezes and decreased benefits have become the norm. ATL is no longer there to hold firm's accountable for their actions- such accountability is now impossible. These drastic actions taken by Firms are the unfortunate reality of today's economic environment. Instead, all ATL does is add to the mass panic of Big Law associates and law students.
This comment has been removed by a blog administrator.
ReplyDeletemy heart drops every time I get a call from any partner at my firm
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteI think the salary reduction is a good general idea of how the market is shifting---non-NY based firms really cannot justify a 160K salary for a first year associate
ReplyDelete5:22...so LA, DC, CHI associates aren't in this picture?
ReplyDelete@ 5:24 --
ReplyDeleteI think hat 5:22 has a point that it is tough to justify equal salaries across the board for associates in every city. Maybe a lot less people would be let go if base salaries had a better COL adjustment? I don't know.
I am convinced that NY has the undisputed highest cost of living--at least with respect to its peer cities.
This sucks!
ReplyDelete-Worried 2L
Should I be worried? 3L with offer at V75
ReplyDeleteWhat scares me more than anything about the slew of bad news on ATL, is that law firms are particularly privy to the state of the economy. The bottom line is, at least arguably, that widespread firm layoffs reflect a consensus that the poor economic outlook is here to stay. Another possibility is that firms over-hired in past years, etc.
ReplyDeleteBut assuming the layoffs are driven by pervasive pessimism, this will have a domino effect. With transparency about what other firms are doing, those that had positive outlooks now know that their competitors are considerably less optimistic; that has to change management at least somewhat, I'd think.
Craig,
ReplyDeleteYes, particularly if sites like ATL keep up the doom and gloom
5:35, or sites like this
ReplyDelete5:34...anyone with an "offer" anywhere should be worried
ReplyDeleteThe WSJ ran an article today saying that over the next year, roughly 2.2 million jobs will be lost.
ReplyDeleteBy my count, 893 lay offs happened today in the legal community. That is, those that were published.
this is not going to get better any time soon. I can only hope that the economy picks up come september/october when firms start extending permanent offers. But I guess there is nothing I can do about that.
-Worried 2L
but...I thought OBAMA's stimulus was going to save us all?
ReplyDelete@ 5:36 --
ReplyDeleteOur goal is not to perpetuate the negativity, but we cannot stay true to our objective of providing a law student's perspective to legal employment, law school and legal issues without paying heed to the unfortunate reality the legal profession and, more broadly, all Americans are now facing.
At least to the extent our posts concern employment. And, for what it's worth, our most popular posts in our short blogging history have related to the legal hiring market.
BAILOUT BIGLAW!!! Think about it. It makes sense. We need lawyers to handle the bankruptcies and vexatious litigation arising out of this
ReplyDeleteactually not a bad idea for law firms to start going after some of this TARP money...I mean, better them than some of the other places
ReplyDeleteAre law firms allowed to go after TARP money???
ReplyDeleteObama is going to drive this economy futher into the ground with his wreckless spending bill (disguised as a 'stimulus bill'). We're going to 10% unemployment.
ReplyDeletei think all of this is going to profoundly change current law students' attitudes toward employment, especially since this will be most people's first jobs. If we were hired a few years ago, most get ingrained w/ an attitude of entitlement.
ReplyDelete@ 6:11 --
ReplyDeleteI won't purport to speak for all law students, but I'll say this: I personally do not feel entitled to a full-time position at the firm I'll be spending my summer with. But, to be honest, I wouldn't have felt that way even in better economic times--I always try to put my best foot forward.
Agreed. I think that, while it may be true to pin that attitude on a few, there are a lot of legitimate hard workers who do not feel entitled to their positions...they just want to make a better life for themselves.
ReplyDelete6:02, I thought eveyrone could go after TARP money...there was a form you just had to fill out.
ReplyDeleteChina owns us now.
China owns a bunch of toxic assets if that's true
ReplyDeleteA cursory review suggests TARP money is only for financial institutions (http://en.wikipedia.org/wiki/Troubled_Assets_Relief_Program). This may be wrong, but who knows...
ReplyDeletewow! this is really bad...ATL has the tally at 400+ Is it gonna get worse?
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeletewe'll get through this
ReplyDeleteTomorrow, I will post and request ideas for changing the legal educational model to enhance practical skills. Stay tuned.
ReplyDeletenightmarish scenario...but truthfully, I think everyone who is now laid off will be able to find work somewhere. The market will adjust...I hope
ReplyDeleteI cannot speak for others on this thread, but I honestly don't think that there is not work out there. I mean everyone I know at my firm is busy as ever (V30) in every practice group...there has to be something in common with the firms that are going belly up.
ReplyDeleteI think there is definitely still work, but it's going to firms smaller than BigLaw. I would guess that all those laid off today will eventually find jobs, albeit most likely lower-paying ones. As for entry-level lawyers, grads from lower-ranked schools are probably the ones that are gradually being pushed out of the market. Smaller firms are seeing so many more over-qualified applicants.
ReplyDeletewhy did I enroll in law school?!?!?!
ReplyDelete8:55-how can you say that? The smaller firms are disappearing fast
ReplyDeleteblatantly put, everyone is suffering...there are no prisoners here
ReplyDeleteyeah, I agree w/ 10:16...it's definitely across-the-board
ReplyDeletehow many here were actually part of the casualties today?
ReplyDeleteWow, this is crazy--just got home from work and saw the "news" on ATL. It's hard to make sense of these lay-offs where I'm coming from: BigTex and MidTex have not had ANY lay-offs yet, no salary freezes, bonuses were paid, summer programs are still going forward. It feels a bit like living inside a bubble... I just don't know enough about the difference between NY-based BigLaw and Texas-based BigTex to understand if this bubble will burst, or if we'll make it through ok. My minimal understanding (or perhaps wishful thinking) is that BigTex is run a whole lot differently than BigLaw, and thus is a little more stable in this kind of economy.
ReplyDeleteThe sky is falling. Act accordingly.
ReplyDeleteNice "The Departed" reference, 10:50
ReplyDelete10:27-----In what sense is the BigTex market immune from this?
ReplyDelete9:42--I say that smaller firms may be hiring, because when I was just on the market recently after the Heller debacle, smaller to midsize firms were the only ones I could get interviews with. Yes, some small firms have closed shop, but other ones are inundated with work.
ReplyDeleteIt has certainly been a scary day. I feel for all those affected by today's events.
ReplyDeleteI am, nonetheless, trying to remain optimistic about the future of the legal profession. I would like to believe that the worst is over, but I doubt that's the case. Other professions were more immediately impacted by the economy, but the legal profession is often the last to be hit and the last to recover.
Still, brighter days will come. But just how far away are they? And what will the damage be? Will BigLaw ever be the same?
10:27pm: My mid-size law firm is very busy right now, no layoffs as of yet, none in the future. I haven't heard of any layoffs in our area yet... and I'm talking about Michigan!
ReplyDeleteI was a senior associate (6th year) at a mid-to-large firm. Several of us between 5th and 7th year were let go late last year. The only openings right now in my practice area are for partners with fairly substantial books. I do feel for you guys in school right now. I don't have any idea how things will shake out, and I decided to take the opportunity (yes, I'm treating this layoff as an opportunity and not an obstacle) and leave lawyering for something different. I'm back doing my "old" job--the one I did before law school--and I'm starting a Ph.D program in the fall. The loans are in forbearance, and I'll probably never pay them off now. I'll do what I can, and that's just going to have to be enough. Thankfully, I never ran up any credit cards, never bought a house, never bought a car or anything like that. Keep ALL your skill sets current and just hang on. This situation will stabilize and you'll all be able to make some plans, set some goals and move ahead. It just might not be quite what you'd expected. And that could be a really GOOD thing.
ReplyDeleteYou are fooling yourself if you think BigTex is not laying off associates...I know 3 associates personally who were laid of by my firm and they just laid me off this week...
ReplyDeleteBigTex = KING OF STEALTH LAYOFFS!!!
YIKES!
ReplyDelete12:00 AM
ReplyDeleteThis is the kind of mentality that i wish most law students would have. I think as a general matter that our profession needs to become less obsessed with entitlement, prestige, and risk aversion. There is an opportunity in every corner, and this downturn is not Armageddon.
Today is the day of reckoning; Friday the 13th! The President will have a stimulus plan to sign, but it won't be nearly enough to save the BigLaw clients.
ReplyDeletePrediction: over 1300 3L offers rescinded, and 400 more attorneys axed. Staff reductions to follow. Happy St. Valentine's Day...
@ 1:39--
ReplyDeleteI think you have a great point...we'll likely address these characteristics of the law student mentality in a main post soon.
I'd really like to be a 1L or 2L right now. At least then I'd have a couple of years before the job search. As it is, I graduated, took and passed the CA bar precisely at the economic meltdown (results 11/08). My timing is extraordinary.
ReplyDelete10:26, how do you think thsis will helP?
ReplyDeleteWhat bigtex law firm is laying off? I work for one and have friends at the major bigtex law firms and they say nobody at their firm has been laid off and there are no plans to do so. All of them are corporate associates and say they are decently busy as am I.
ReplyDeleteI still don't understand what advantage Big Tex has that would make them purportedly immune to this recession ... can someone please explain?
ReplyDelete171, there are a couple of things that Texas has that make them more immune, not immune. Large Texas law firms are not run the same way as firms based out of New York. The factor most important in this current economy is leverage. Large Texas firms are usually leveraged 1 to 2 or less. Some of the NY firms are leveraged 1 to 4 or 1 to 5 even. This has several effects. The first being that when times are good Texas firms are going to make less PPP. They simply don't have enough bodies doing the work to drive that figure up. (However, their PPP are still about 1.3 million so I would take that). Another effect of being less leveraged is you don't have as many bodies sitting around without work to do in a downturn. Instead of each partner having to generate work for 5 other associates they only have to generate work for 1 or 2. That makes a big difference in this economy.
ReplyDeleteAnother factor that we haven't seen yet (but most are stating that we are starting to see as the credit markets become unfrozen) is that downturns in the economy lead to a lot of deal activity in the energy industry. You have larger companies picking up smaller ones, etc. This has happened in every economic downturn over the past 80 years.
Finally, personally I work for a BigTex firm and while I was really slow in November and December work has picked up again. I'm billing quite a few hours and I don't know anybody who doesn't have full days of work to do in corporate.
1:04 PM ... makes sense. I figurued energy was a huge cash cow for BigTEx, but why would a down economy encourage deals?
ReplyDelete2:20, it's usually because of the depressed value of companies during a downturn. Larger energy companies are able to pick off the smaller ones in downturns and be better positioned once the economy turns around.
ReplyDelete3:34, why wouldn't that also be true for other sectors (not just energy)?
ReplyDelete7:40...it is true for other sectors. The problem is that banks, etc., are precisely the ones being hit hardest by this recession, and as you are probably aware, this is where a majority of NY Biglaw draws its business
ReplyDelete2:09, interesting. I didn't
ReplyDeletenotice that particular take on the crisis. I still think that the credit crunch has to have some effect on BigTex' and other markets' ability to draw sufficient capital to make these transactions. Or, is it just that these companies already have massive pockets already?
Any news on more movement? ATL was silent today...
ReplyDeleteI practice in Montreal...markets thus far have been slow to move to the downturn, and business seems to be operating as usual
ReplyDeleteNorthern Cal (V20) here. I am very worried. Hope things are back to normal next quarter.
ReplyDeleteBank mayhem!!! Things could get nasty in the next two weeks...
ReplyDeleteANOTHER BLACK THURSDAY???!!!! This sux ... News about firms laying more people off!
ReplyDeleteFrom V10 in DC --- Things are getting scary
ReplyDeleteINSANITY!!! When is this going to stop?
ReplyDeleteI don't understand why this is being excaserbated. We knew that the Magic Circle was having problems 8 months ago. I don't think it has any relation to domestic firms.
ReplyDeletejust heard some very bad news :(
ReplyDelete2:47, What bad news???
ReplyDeletepink slip
ReplyDeletebesides 2:47, any ACTUAL news of layoffs?
ReplyDelete...
ReplyDeleteAdvised to leave V10 ny w/in month
ReplyDelete3:03, OMG! That is horrible.
ReplyDelete3:03 ...
ReplyDeleteWhat practice group?
3:03 here: it's a group that's supposed to be countercyclical, 3:10
ReplyDeleteHow were your hours?
ReplyDeletebloody times we're living in, no?
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteI am a 2nd at a V5 in NY, and I am very worried about my job. I just bought a new apartment...
ReplyDeletebarbaric!
ReplyDeletelayoffs in LA....the ship is going down.
ReplyDeletecalifornia is a dead market
ReplyDeleteOMG it's happening again...this is endless, my loans will never be paid offl
ReplyDeleteAs a gentle reminder, please refrain from posting anything pertaining to specific firms. Thanks!
ReplyDeleteUndeniably believe that which you said. Your favorite reason appeared to be on the web
ReplyDeletethe easiest thing to be aware of. I say to you, I
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