Optimistic Outlook for In-House Hiring of Lawyers

The Wall Street Journal Law Blog reports on "a breath of spring in a job market that’s been wintry for far too long." Given our recent post documenting the latest dismal numbers for law firm hiring of law students, it's refreshing to hear from the Association of Corporate Counsel’s (ACC) 10th Annual Chief Legal Officer Survey that things seem to be looking up for hiring of in-house lawyers.

According to the ACC survey, the outlook for Chief Legal Officers is showing signs of optimism, with increased job satisfaction and internal hiring plans for 2010.

Some key points to note from the survey:

• Uptick in hiring/staffing: There was a greater focus on internal hiring in legal departments, as well as an increase in corporate attorneys outside the U.S. Despite the recession, more than a quarter (29%) of the respondents plan to hire staff for their in-house legal departments in 2010,up from 23% who had hiring plans in last year’s survey.

• Job satisfaction is strong: Even with increased scrutiny and expanded duties, an overwhelming majority of respondents (91%) reported they are still satisfied with their chosen career, up from 88% in 2008.

• Increase in workload, demand for alternative fees and decrease in outside counsel work: Even with this uptick in staffing, the recession has impacted legal departments’ workload, budget and outside counsel spend. More than one-third (34%) of respondents reported a cut in spending on outside counsel, and those who did employ outside counsel used more alternative fee arrangements. (Of course, the downside is that this could mean less work for law firms, and fewer jobs for lawyers and law students at those firms).

While the optimistic outlook for hiring of in-house lawyers is a bright spot on the legal employment horizon, Ashby Jones, Lead Writer of The Wall Street Journal Law Blog notes in his post that, "of course, this doesn’t mean that the floodgates have opened. Nor does it mean that in-house jobs are going to be easy to get."

The increase in in-house hires may just be a glimmer of hope or it could be more of a restructuring caused by the recession, as suggested by ACC deputy general counsel, James Merklinger. Merklinger says in a recent post on Corporate Counsel: "The added hiring most suggests that the recession is forcing chief legal officers to change the way they operate. They're bringing more work in-house, spending less on outside counsel, and boosting spending on alternative fee arrangements, the survey shows."

Still, someone has to get those in-house jobs, right?

Ashby Jones of The Wall Street Journal's Law Blog was a guest on a recent Law School Podcaster segment, “The Current Economic Environment: What It Means for Law School Applicants and Students.” Check out the full show to hear more on this topic.

The Latest Numbers on Recruiting Law Students

It's hardly news, at this point -- we know that law school grads face layoffs, deferrals and increased competition for fewer jobs. Yet somehow the numbers from the fall 2009 recruiting season seem worth noting. As reported in the ABA Journal, the National Association of Law Placement's (NALP) annual Perspectives on Fall Recruiting (PDF) was released Tuesday and, not surprisingly, recruiting volume by U.S. legal employers on law school campuses "nose-dived."

Some key stats to note:

• Summer associates: the median number of offers dropped to seven for 2010 hiring. The median number of offers for students recruited in 2008 was 10, dropping from 15 in 2007, NALP reports.

• At large firms with more than 700 lawyers, offers extended to 2Ls dropped to eight in 2009, down from 18.5 in 2008 and 30 in 2007. And while larger firms of more than 500 lawyers were the most likely to cut back on-campus recruiting efforts, smaller firms with 100 lawyers or fewer were more likely to have kept to their regular on-campus recruiting schedule.

• Acceptance rates were 42.8 percent, the highest ever recorded -- evidence that law students quickly snapped up offers of employment.

• Almost two-thirds of offices reported that their summer program was at least one week shorter than in 2008. Among firms of 251-500 lawyers and 701 or more lawyers, over 70% did so.

• Deferrals were also way up, with 85 percent of law schools reporting that at least one 2009 graduate faced an offer delay well into 2010. NALP estimates that at least 3,200 and as many as 3,700 graduating law students faced deferrals.

• Third-year hiring all but dried up, with just a handful of offices reporting any activity at all, and with those that did typically making 1 or 2 offers. In total, only about 3% of employers reported recruiting any 3L students.

NALP Executive Director, James Leipold, said in a statement about the report, "this represents an enormous interruption in the usual recruiting and employment patterns that we have come to expect.” Leipold noted "the largest impact was the deferral phenomenon" for the Class of 2009.

While many deferred associates have now started to work, deferrals are still present and, NALP expects those who don't have solid start dates at this point will be deferred.

There is, of course, "tremendous variation in legal hiring -- both by region and by individual employer" but these numbers tell a story and NALP doesn't expect big improvement in this picture for the short term. The ABA Journal reports that "NALP expects law school recruiting to continue hobbling along until at least the class of 2012 graduates, "though the worst does now seem, we hope, to be behind us."

NALP's Jim Leipold was a guest on Law School Podcaster's segment, "The Current Economic Environment: What It Means for Law School Applicants & Students." Tune into the full show to hear more on this topic.