First it was bankers, then the techies — now lawyers are the biggest earners in the graduate jobs market.
An industry once associated with grey suits, tedious paperwork and arrogant partners — Suits’ Harvey Specter wasn’t plucked from thin air — has found itself engulfed in an intense battle for talent that’s sparked a salary arms race.
New law graduates are being handed starting salaries as high as £156,000 thanks to a boom in corporate deal-making and property transactions after Brexit and Covid.
“Since the pressure valve was released, deals are flying and pushing huge demand on lawyers,” says Ian Roberts, founder of recruitment firm NQ Solicitors, which specialises in junior lawyers.
“Senior associates — the ones running the deals — are leaving the profession as it’s catching up with them and it’s juniors being recruited.”
Scott Gibson of legal recruiter Edwards Gibson says: “Partners in almost every practice area, in every class of commercial law firm, need additional support.”
Hefty workloads and the solitude of working from home have led to high incidences of burnout “and law firms have responded with double-digit pay rises and generous bonus payments triggering an associate salary war.”
US law firms are leading the charge.
New York-headquartered Milbank recently announced a $10,000 pay hike for newly qualified lawyers, taking their salary to $215,000 (£160,000).
US rivals with London offices have responded with pay hikes of their own.
The money isn’t quite as good at London’s leading law firms, the so-called Magic Circle, but it’s heading that way.
Roberts says: “The gap is widening between London [pay] and the rest — it’s already almost double in London.”
Pay isn’t the only thing going up: perks are getting better too.
Sign-on bonuses to being offered in some cases, as well as relocation packages.
Once you’re through the door, law firms are also offering “anything to make sure lawyers are kept at their desk,” as one insider puts it.
“Dentists and doctors in the office, chefs making meals after certain hours, flashy offices. They try to make your existence more bearable.”
With higher pay and sweeter perks comes more work.
The joke goes that new lawyers can save 100% of their salaries as they are given no free time to spend it.
Roberts says: “I’ve spoken to [junior lawyers] who are working 3000 billable hours a year — and that doesn’t include any holidays, any time spent on training, or an appraisal, or a catch up with your boss — so it’s 12-hour days seven days a week, which is not sustainable.
"This kind of workload isn’t going to go away, but there’s a line up of people saying ‘I’ll do this for four years, get my house bought and then do something else.”
A senior figure at a US law firm asked Roberts “to find me grunts — junior lawyers with almost zero chance of partnership, who only might do it for a few years, but will churn through the hours”.
Junior corporate law work involves zoning in on very detailed parts of transactions, running verification exercises, and gathering data: “It’s important work, and it’s got to be done right, but it’s long and arduous,” Roberts admits.
A junior corporate tax lawyer recalls being in the office till 1am, walking through his front door and getting a phone call from a client demanding an urgent conference call.
He got into bed, dialled into the call for two hours — and didn’t have to say a word. But the client was involved in a $5 billion deal, and if he wanted to pay £800 to have a junior listen mutely to a phone call, he could do just that.
Is it all worth it?
Most lawyers say no, and yet they remain in the profession.
A senior in-house lawyer at a FTSE 100 firm, who spent a lucrative decade working his way up up at a Magic Circle firm, tells me today’s graduates prize flexible working and work-life balance.
The bulge-bracket salaries City firms are dangling in front of newly qualified solicitors are not enough.
“All the pay and fancy meeting rooms can’t make up for photocopying and correcting someone else’s typos at 3am,” the FTSE lawyer says.
“If you want some meaning in your work life, you’re unlikely to find it in a law firm.”
Where will it end? Salary wars are usually “a portent of a market correction,” Gibson says.
“I’ve seen two major associate salary wars: during the dot.com boom and in the run-up to the global financial crisis.
"Both ended badly for associates when the market cooled — in the UK, associate compensation fell sharply in both 2002 and 2010, and hundreds [of lawyers] were fired.”
London’s newest legal hires might do well to save their bumper pay cheques while they can.
