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First-year associate hiring remains flat

Law firms conservative when it comes to entry-level jobs, starting salaries

First-year associate hiring at the major law firms in Maryland has remained relatively steady, with most firms reporting only a small difference in the number of beginning attorneys joining their ranks this fall compared to last year.

Venable LLP will have six first-year associates starting this year in Maryland, according to Baltimore hiring partner W. Bryan Rakes. That’s the most of the 11 major law firms in the state that responded to a Daily Record survey. (Maximilian Franz/The Daily Record)

Venable LLP will have six first-year associates starting this year in Maryland, according to Baltimore hiring partner W. Bryan Rakes. That’s the most of the 11 major law firms in the state that responded to a Daily Record survey. (Maximilian Franz/The Daily Record)

Several managing partners responding to a Daily Record survey described their firms’ attitudes toward entry-level hiring as conservative, emphasizing both the value of adding young attorneys as well as the importance of not over-hiring.

At some firms, partners said a balance of lateral and first-year hiring is the key to meeting clients’ needs while keeping rates at a level they’ll be happy with. Still other firms have avoided hiring first-year associates entirely, citing a more flexible, as-needed growth plan or clients who prefer working with experienced attorneys.

Three firms — DLA Piper US LLP, Saul Ewing LLP and Gordon Feinblatt LLC — will bring on two first-year associates in Maryland this fall. That’s the same number of entry-level attorneys who began at Saul Ewing and Gordon Feinblatt last year, and an increase of one for DLA Piper, a 4,200-lawyer firm with 127 attorneys in the state.

“I think there’s always a need for entry-level lawyers,” said Matthew Gorra, hiring partner at DLA Piper’s Baltimore office. “There’s certainly more pressure — thinking back to who we serve, which is our clients — to ensure that every lawyer that works on their matters is appropriately trained and equipped to handle their legal needs, and so we hire conservatively, I would say, at the entry level.”

DLA Piper is not the only firm that’s been conservative in hiring first-years: Both McGuireWoods LLP and Tydings & Rosenberg LLP had no first-year associates in Maryland last fall and will only bring on one each this year.

Of the 11 firms who responded to The Daily Record’s survey on first-year hiring, Venable LLP and Miles & Stockbridge PC will have the most first-year associates starting in Maryland this year, with six and four new, entry-level attorneys respectively — a year-over-year decrease of one for Venable and increase of one for Miles & Stockbridge.

Venable planned for eight first-year associates to begin in the fall, but two will join the firm after completing clerkships, according to Baltimore hiring partner W. Bryan Rakes.

Outside the Baltimore area, Potomac-based Shulman, Rogers, Gandal, Pordy & Ecker P.A. has hired about three summer associates per year recently with the goal of bringing on two or three as first-year associates, said Samuel M. Spiritos, the firm’s managing shareholder.

“We feel that we have an extremely robust hiring plan at all levels,” Spiritos said. “We could have a much larger summer associate pool, but we don’t want to dilute our ability to hire.”

Salaries inch up

Most firms have kept first-year salaries stable in recent years as well, although there have been some small increases.

Among firms that bumped up their first-year salaries for the fall 2014 starting class, none saw particularly dramatic increases this year, however: Saul Ewing’s rose by 8 percent, Gordon Feinblatt’s by 4.5 percent and McGuireWoods’ by 3.7 percent.

At other firms, entry-level salaries will rise slightly this fall. Tydings & Rosenberg paid $100,000 to first-year associates who started at the firm in fall 2013, whereas the firm will pay this year’s first-years $102,500. (No entry-level attorneys started at the firm last fall). Venable’s starting salary rose from $150,000 last year to $160,000 this year.

“The firm generally reviews first-year salaries relative to the market on an annual basis,” said Rakes, the Venable hiring partner. “What are our competitors in Am Law 100 firms doing? Our goal is to always be competitive — if not at the top, then in the range of the top-paying law firms in the country.”

The new $160,000 starting salary puts Venable on equal footing with DLA Piper, which has kept first-year salaries at that level for the past several years.

“We set the starting salary for our associates in a way that we think can attract the best talent and reward hard work and excellent client service. Those decisions are impacted by the markets in which we compete,” Gorra said. “Although the economy has certainly rebounded, I think across the board you haven’t seen, nationally, a significant increase in associate starting salaries.”

According to the National Association for Law Placement’s 2015 Associate Salary Survey, the national, median first-year associate salary is $135,000, while $160,000 is the most commonly reported starting salary at the largest firms in the largest markets — such as Washington, D.C., New York City and Los Angeles.

Finding a balance

Even though first-year hiring at some firms has stabilized, several managing partners said they consider lateral hires just as important an aspect of their growth strategy.

Because decisions about first-year hires are often made long before the attorneys start at the firm — a potential summer associate who interviewed with a firm in fall 2012 would have worked at the firm during the summer of 2013 but wouldn’t begin his or her first year until fall 2014 — it’s difficult to predict the firm’s needs so far in advance, and lateral hires can help bridge that gap, several partners said.

‘I think there’s always a need for entry-level lawyers,’ says Matthew Gorra, hiring partner atDLA Piper US LLP’s Baltimore office. (File photo)

‘I think there’s always a need for entry-level lawyers,’ says Matthew Gorra, hiring partner at
DLA Piper US LLP’s Baltimore office. (File photo)

“Because of that reality, it is definitely an imperfect science. We’re seeing that right now,” said Rakes, of Venable. “We’ve had to hire quite a few laterals in the Baltimore office to fill the need. We’ve gotten busier than we anticipated however many years ago when we set those numbers.”

And because the economic downturn several years ago resulted in firms shrinking their summer associate class sizes — which in turn led to lower numbers of first-year associates in the following years — it can be difficult to find qualified laterals to hire now, Rakes said.

“The number of associates that went into larger law firms over the course of a three- or four-year period were down, so you have a smaller lateral pool from which to choose today,” he said. “It’s been a little more difficult in the last few years to fill with laterals, simply because the numbers in the pool have shrunk so much. Everybody’s competing for the same people.”

At Shulman Rogers, Spiritos credited much of the firm’s success and growth to its lateral partner program. The firm hires based on which practice areas need support at a given time, rather than aiming to add a specific number of lawyers, he said. Areas like cybersecurity and intellectual property have recently received increased focus at the firm, for example.

“We are strategic and opportunistic, but we don’t have any objective criteria in terms of how much and when we’re going to grow,” Spiritos said.

Worthwhile investment?

At least four firms don’t plan to bring on any first-year associates in Maryland this fall. Hogan Lovells LLP, which has 36 attorneys in Baltimore out of more than 2,500 worldwide, hired three entry-level lawyers to start in Maryland last year but will have none working in the local office this fall. Lerch, Early & Brewer Chtd. in Bethesda hired one first-year in 2014 but also won’t bring on any this year.

Ober | Kaler and Offit Kurman P.A. did not bring on entry-level attorneys last year and do not plan to do so this fall, either. Howard Kurman said Offit Kurman’s growth strategy revolves around lateral acquisitions, such as bringing other firms under its umbrella or adding solo practitioners to its ranks.

For the mid-sized firm, the investment of time and money that first-year associates require doesn’t make sense, Kurman said.

“In the market that we serve, businesses that are entrepreneurial themselves, frequently they want to associate with and be advised by experienced attorneys,” he said. “They don’t want to pay for the education of a first-year law graduate. That’s one of the reasons our recruiting efforts have been directed toward acquiring experienced attorneys.”

But from a different standpoint, Rakes said, the value of first-year associates becomes clear as they put in more time with the firm.

“The longer you’ve been here [at Venable], you build relationships with people you work with; you build relationships with clients,” he said. “For a fifth-year associate who’s been here five years, we know what you’re capable of.”