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Large Numbers of Law, Latham II

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From January 1, 2008 to December 31, 2010, large law firms canned 15,435 employees. That was 5,872 attorneys and 9,563 staff.

Those are just the numbers known through either official firm announcements, or through tips to the gossipier parts of legal media. They don't take in to account stealth layoffs, hiring freezes, rescinded job offers, and layoffs that just happened to go under the radar.

According to NALP, the total job loss across the entire legal sector for that period was 45,000. Since small firms tend to have far less staff (your 20 person firm doesn't have an HR department, much less a dedicated HR secretary), we can assume a very large number of those 30,000 outside of BigLaw are attorney jobs.

Law school cheerleaders have all been talking about how this downturn is cyclical, and not a sign of the new normal. Cyclical, despite now moving in to year 4 of the down turn.


When the Latham I happened, we had basically two different phases. First, firms cut the fat by dropping excess staff and then their excess lawyers. The second phase was reducing hiring, either by rescinding offers, reducing summer associate class sizes, or no-offering more summer associates.

A question worrying a lot of young law students and young lawyers now is what if it happens again? What would Latham II look like?

What we won't see are flashy headlines about mass layoffs. A few firms that didn't have layoffs the first time around will reduce their headcount. We've already seen this happening with Dewey, Bingham, Linklaters, Fulbright, Goodwin, O'Melveny, Paul Hastings, Pillsbury. [ATL] But, those cuts are over many months, it's not the constant day after day barrage we saw in 2009 and 2010. And, as the few remaining firms still hauling around their pre-recession fat finally do make those cuts, the news of layoffs will slow down even more.

Rather than layoffs, Latham II will simply be the non-hiring of junior associates.


In 2007 the median summer associate class size was 17, for people summering in 2012, the median class size is only 5. In 2007 the average class size was 39, in 2012 that number is only 22. That 22 is a good ways up from the low point of 16 two years ago, but it's hardly a good sign of a recovery. These are 2L students, the people law firms expect to be starting in the Fall of 2013, or if delayed start dates continue, Spring of 2014.

Law firms are projecting that the market will still be severely depressed come 2014. That will be the 6th year of the downturn. The depressed market is already longer than the average law professor's legal career. By 2014, the legal depression will be old enough that it'll need to start looking at expanding its book of business to bolster its upcoming partnership bid. People who went back to school after being Lathamed will be working on their PhD dissertations.

Latham I saw nearly 6,000 BigLaw associates laid off over a 3 year period. At current hiring levels, over 3 years Latham II will produce nearly 10,000 first year BigLaw associates who simply never get hired. For those of you bad at numbers, Latham II, the new normal, will be significantly worse than Latham I.

[Law Shucks Layoff Tracker]

[NALP March press release]

[More Large Numbers of Law]

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