The Foster Group Featured in Law360 on Mid-Law Firms' Advantage in Legal Talent Market
/Advantage Shifting to Mid-Law Firms In Legal Talent Market
As the market for legal talent shifts following two years of high demand, recruiters say that Mid-Law firms may be able to gain an advantage in recruiting quality candidates by playing to their strengths and offering candidates more flexibility and career development opportunities.
After more than a year of breakneck hiring, the legal talent market slowed in the second half of 2022 back to what several recruiters describe as more normal conditions, which could create an opening for the midsize, regional and boutique firms that found themselves struggling to compete against sky-high BigLaw compensation during the boom times.
Law360 Pulse spoke to seven recruiters from around the country about their perspective on where things stand for Mid-Law firms in the legal talent market today and how firms can attract lateral talent.
“For the right firms … they will have access to talent now that they didn’t have before,” said Larry Watanabe, a California-based recruiter.
The Market Is Changing
Most recruiters said that the lateral talent market has cooled since early 2022, though this depends on region. Andie Viele, founder of VCG Attorney Recruiting in the Miami and Fort Lauderdale area, said that candidates she’s seeing, especially associates, are still focused on the BigLaw firms that have moved into the market, and many would prefer to wait for an opening there than go with a Mid-Law firm.
“Candidates are paying close attention and are vying for the few slots that have been available at firms that have recently entered the market,” Viele said by email. “This, coupled with the widened gap in compensation between BigLaw and smaller firms, has increased candidates’ patience in waiting for the ‘right fit.’”
However, most recruiters told Law360 that the balance in their regions is shifting more toward Mid-Law.
“Firms over the course of the pandemic, over the last couple of years, they overhired,” Watanabe said. “They hired for what was necessary during that period, but that workload has diminished severely now.”
Meanwhile, recruiters said, Mid-Law is often still as busy as ever. “Most of the partners I know who practice in the midmarket space are not slowing down,” said Brian McMahon, a recruiter with Major Lindsey & Africa who is based in Minneapolis.
This creates a situation where midsize, regional and boutique firms may finally be able to afford the talent they are looking for.
“I would say that in terms of smaller law firm clients, this seems to be a nice turn of events for them,” said New York-based recruiter Bill Davis of the Davis Group. “They find themselves in a situation where they’re back in the driver’s seat a bit, whereas in the last hiring frenzy, they were really outgunned by BigLaw salaries.”
Candidates Still Look for the Same Things, Mostly
Even as the talent market itself changes, however, the things that candidates find attractive tend to remain constant at all times - though there are some exceptions. For instance, the COVID-19 pandemic has added remote work options to the candidate wish list, and some of the dynamics in the current talent market are particular to the current moment.
Some of the attorneys looking for new opportunities may have been affected by the wave of layoffs that hit BigLaw recently. And Josh Shirley, a Denver-based recruiter with Kinney Recruiting, said that many of the candidates he’s seeing are people who are influenced by trends they are seeing at other firms right now.
“The large majority of attorneys didn’t (move during the pandemic),” Shirley said. “So we’re seeing a lot of partners especially that are starting to look because they have stayed put … and maybe are starting to feel like they’re not seeing the growth in their compensation that they’re reading about at other firms.”
Chris Batz, a recruiter with The Lion Group based in Kansas City, noted that many BigLaw attorneys, especially associates, are also experiencing burnout after the past two years and may be explicitly looking for a firm that will let them bill fewer hours.
McMahon echoed this. “Lawyers always worry when things slow down, but at the same time, I don’t know any lawyers who want to work as hard as 2021 again,” he said.
Overall, however, firms looking to recruit can rely on candidates being interested in the same tried and true factors.
“Many people are moving for the same factors that always impact laterals’ careers,” said Elaine Oh, a Senior Legal Recruiter with The Foster Group who is based in New York. “They’re looking for a better platform, better compensation, more support.”
Mid-Law Firms Have Advantages in the Current Environment
In this environment, recruiters said, Mid-Law firms should play to their strengths. And they have many potential advantages.
“An important (factor) is midmarket firms tend to be a bit more conservatively managed,” Oh said. “They didn’t go gung-ho crazy in hiring, and they are now in a good place financially and have opportunities.”
Shirley noted that many Mid-Law firms have seen their profits per partner increase substantially, putting them in a position to pick off top-tier talent.
“We’re seeing a lot of those firms that are able to court and pick up partners from even AmLaw 100 firms,” he said. “It shows that there has been a lot of growth in profitability from among the midsize, regional and boutique firms.”
Mid-Law firms also have their more traditional qualities to pitch to candidates, such as flexible billing rates and opportunities for partners to grow their book of business.
“They are able to offer comp packages to partners who are underpaid and feel their books are going to be stagnant for the next couple of years because of rate pressure,” Shirley said. “They should be opening the doors to partners who are a little more junior in their careers, are growing their books of business.”
Smaller firms can also typically offer a quicker route to leadership for partners, more client interactions and partner mentoring for associates, and other career development opportunities.
The key, recruiters said, is providing a place for attorneys to progress in their careers.
Recruiters recommended that Mid-Law firms take advantage of the current environment to focus on talent, even if they still find themselves behind on salary. Viele, for instance, said that in light of the tight Miami talent market, she is encouraging clients to widen their parameters and give “maybe” candidates an interview.
And recruiters are still keeping busy.
“It doesn’t feel frenzied, but I am working 12-hour days,” Davis said. “If the BigLaw hiring has slow a bit, it certainly has been replaced a bit by smaller firms and boutiques.”