Legal profession feels economic pain
By Meir Rinde
Dec. 6, 2009
TRENTON — After graduating from The College of New Jersey, Bradford Bondor headed to law school with the aim of combining his interests in science and writing to become a patent litigator, helping companies protect their ownership of profitable high-tech innovations.
But as he finished up his final term of law school earlier this year, it became clear to the Holland Township resident that the days of moving directly from law school to a high-paying legal job were over. As of this week he’s still looking for a job.
“By the time we graduated, we knew we’d have a tough time of it,” Bondor said Wednesday during a reception at the Trenton War Memorial for newly sworn lawyers. “I know some people who are still looking, and others who have found something.”
“There’s a job out there. I just have to be optimistic,” he said.
Other young attorneys who were milling around the New Jersey Bar Association reception following their swearing-in told similar stories of extended job searches, rescinded offers and part-time jobs taken to pay the rent.
“I don’t know too many people from my class who had a job before they graduated, and even after graduation they still struggled to find a job,” said Drexel Hill, Pa., resident Theodore Choi, who attended Widener Law School. “I’m doing some contract work for some labor law attorneys in Philadelphia.”
In good times, the law is a top-earning profession. Until recently, new hires at large firms in New York could earn $160,000, while partners and experienced in-house corporate attorneys earned multiples of that figure.
But as corporate profits fell and individual clients lost their jobs or saw business revenues decline, a wave of belt-tightening swept the industry. Corporate transactions like mergers and acquisitions dried up, payment for legal judgements slowed or stopped, and bankruptcies rose, lawyers say.
New attorneys have been left to fine-tune their resumes while watching their student debt mount.
Experienced lawyers have been pushed out of their jobs and face starting anew as solo practitioners.
Firms’ real estate departments were gutted and firms instituted across-the-board salary reductions and bonus reductions.
In Mercer County the number of law jobs, including lawyers and other legal positions, has sunk 15 percent since October 2006, according to figures from the state Department of Labor.
“We know there are very, very few opportunities and they’re hard to get,” bar association president Allan Etish told the new lawyers during their swearing-in ceremony. “Remember, we all faced similar challenges at different times. There have been economic ups and downs, none quite as dramatic as the last 12 or 15 months.”
Princeton’s large legal community has seen layoffs and hiring reductions as part of the national downturn in legal employment, said David Garber, an attorney who heads a headhunting firm, the Princeton Legal Search Group.
“There really is no associate law firm market to speak of,” Garber said. “Quite the contrary, there have been thousands and thousands of lawyers who have been laid off. I mean the best of the best. That seems to have stabilized, but the hiring really has not returned yet.”
The crisis appears to have hit late last year and escalated over the spring and summer. While the locations of layoffs are not always named, the Princeton offices of some firms were reportedly affected.
Nationwide, Drinker Biddle dismissed 20 lawyers in December 2008, according to Above the Law, one of several blogs that closely track industry layoffs. The firm has about 50 attorneys at its College Road East office.
Reed Smith, which has more than 40 lawyers in Forrestal Village, announced in May that it was cutting associate salaries by 10 percent, according to another blog, JDJournal. Blank Rome, in Carnegie Center, reduced entry-level pay from $145,000 to $130,000, the Philadelphia Business Journal reported.
Buchanan Ingersoll & Rooney eliminated administrative positions, slashed its associate hiring nationwide, then deferred their start dates and cut all associate salaries, JDJournal said.
Pepper Hamilton, in Carnegie Center, offered jobs to just half of its summer interns, compared to 79 percent last year, while Morgan Lewis offered jobs to less than a third of summer interns, canceled next year’s summer program and sharply reduced associates’ base pay, the blogs reported.
Garber, who counts Drinker Biddle among his clients, said the economic crunch is restructuring the legal industry.
“There has been a lot of pushback from clients of law firms, who have said, ‘We don’t want you to increase your billing rates this year, in fact we want you to go in the other direction, and at the same time we don’t want very junior level associates billing on our cases,’” he said.
“Four or five years ago, we would have been talking about how being a law firm with multiple offices across the country would have been the only way to go, because that’s what clients wanted. Now clients are realizing that smaller firms can do very good work for them,” he said.
Small firms and solos have been feeling the pain, too, however, since they depend heavily on the fortunes of individuals who have been battered by job losses and small businesses plagued by the drop in consumer spending.
William Boyd, a solo practitioner on South Broad Street in Trenton, said it’s often barely worth it for him to pursue cases because the defendants often have no money.
“To say it’s been rough is an understatement,” Boyd said. “At least in my practice, when I’m representing either a creditor or a customer who is defending a collection suit, it’s not a question of them not wanting to pay, it’s that because of the economy and the recession, they just can’t pay.”
The recession has increased the amount of bankruptcy work available, but such cases do not necessarily provide much income, he said.
The New Jersey Bar Association has been offering free seminars on setting up a legal office for lawyers who have been laid off or are looking to leave their firms. Boyd, though, had his doubts.
“I probably would not recommend going into private practice as a sole practitioner, just because the economies don’t make sense,” he said. “I still think it’s a profitable career, and I wouldn’t say the recession isn’t a reason not to become a professional to practice law. But it’s going to be some lean years.”
The job market for attorneys is not entirely bleak. Garber said the recession has created more work in some fields, like bankruptcy and employment law.
Compared to other professions, pay rates remain high and layoffs are relatively rare. But for many new graduates and some older attorneys, jobs will remain hard to find for the foreseeable future.
“While this is all kind of doom and gloom, I think things are turning,” Garber said. “I’m starting to see some positive things in the market, although we’re not anywhere near where we were two or three years ago.”
An excerpt of this article is also available on NJ.com.
Copyright © The Times of Trenton 2009