Salaries at Largest Firms Peak in 2009

July 30, 2009

NALP has just released its 2009 Associate Salary Survey. With salary information collected as of April 1, 2009, this year’s report reflects what is likely to be the apogee of large firm salaries for the foreseeable future, and represents the culmination of increases since 2006. The prevailing salary at the largest firms in many cities, including Austin, Boston, Chicago, Dallas, Houston, Los Angeles and Orange County, New York, San Diego, San Francisco, San Jose, and Washington, DC, stood at $160,000. Just two years ago the prevailing salary had reached $160,000 only in New York. However, the fact that during the period following April 1, 2009, some large firms were cutting salaries means that the $160,000 figure may not be sustained in many markets.

The overall median starting salary was $130,000, and ranged from $70,000 in firms of 2-25 lawyers to $135,000 in firms of 501-1,000 lawyers, and $160,000 in firms of more than 1,000 lawyers. (See table below.) Most medians in firms of 500 or fewer lawyers were fairly stable compared with 2008.

A total of 642 offices provided salary information as of April 1, 2009. With 14% of respondents representing firms of 50 or fewer lawyers and 42% representing firms of more than 500 lawyers, the survey report sheds valuable light on the breadth of salary differentials among employers of varying sizes at the national level.

As expected, each year of associate experience brings several thousand dollars in increased compensation: median salaries for eighth-year associates ranged from $111,625 in small firms to $258,000 in the largest firms, with a median for all reporting firms of $171,275.

The volume of data reported on this year’s survey allowed analyses for 29 individual cities as well as many additional states and regions not encompassed by those cities. These analyses reveal a wide range of law firm compensation. For example, the median salary for first-year associates in all firms of more than 250 lawyers was highest in the West, at $160,000, followed by $145,000 in the Northeast and the South, and $117,500 in the Midwest. The highest first-year salary reported was $165,000. Salaries of $160,000 were not typical everywhere — medians in areas such as Cincinnati, Detroit, Grand Rapids, Indianapolis, Las Vegas, Portland, OR, and Tennessee, ranged from $91,000 to $107,500. Contrasts between large and smaller metropolitan areas are also evident. For example, in large metropolitan areas of more than 5 million, the prevailing starting salary in firms of more than 250 lawyers was $160,000; in metropolitan areas of fewer than 1.5 million, the median was $100,000.

The 2009 Associate Salary Survey also gathered information on salaries for intellectual property lawyers as well as on salary levels for staff attorneys and law clerks. Information on salaries for intellectual property attorneys was more limited, and in large part reported by firms of more than 250 lawyers. The information reported suggests that, compared with these size firms as a whole, IP lawyers may command a salary that is $15,000 to $20,000 higher among junior associates but that the differential is larger among more senior associates. However, when IP salaries are compared with those of the very largest firms (those of more than 1,000 lawyers) as a whole, medians are very similar.

Additional findings show that salaries for staff attorneys are typically just over $100,000 per year, while the median hourly salaries for law clerks range from $19 to $50 per hour depending on firm size.

The survey also reports on bonus systems at participating firms and the prevalence and size of bonuses for prior judicial clerks. Among the findings on bonus systems: about 68% of firms use discretion as a factor to determine eligibility for bonuses. About 35% use “meeting fixed goals” as a determinant of eligibility, although firms of more than 1,000 lawyers are most likely to do so — about 48%. Bonus amounts were based on various factors, the most common of which were billable hours (74% of offices offering associate bonuses), merit (68%), and discretion (60%). Nearly all of the largest firms of more than 1,000 lawyers reported paying a bonus to prior judicial clerks. Relatively few smaller firms did so. Bonuses of $10,000 to $25,000 were most typical.

More detailed results by city and region, including medians, averages, and ranges of base salaries for associates through the eighth year, as well as information on aggregate compensation for associates, and compensation structures, are found in the complete 2009 Associate Salary Survey, now available from NALP’s Bookstore.

Median Base Salaries by Associate Year and Firm Size (as of April 1, 2009)
Associate Year FIRM SIZE — Number of Lawyers
2-25 26-50 51-100 101-250 251-500 501-1,000 1,001+ All Sizes
Median # Rept Median # Rept Median # Rept Median # Rept Median # Rept Median # Rept Median # Rept Median # Rept
First $70,000 27 $92,500 30 $104,000 53 $110,000 76 $125,000 121 $135,000 117 $160,000 126 $130,000 550
Second 71,000 26 92,000 34 101,500 48 112,000 73 128,950 112 140,000 103 160,000 95 130,000 491
Third 70,000 25 98,000 35 102,000 48 115,000 71 135,000 108 143,500 106 170,000 95 135,000 488
Fourth 77,175 26 101,750 30 105,500 48 116,250 66 140,000 109 148,000 109 185,000 95 141,000 483
Fifth 94,950 20 104,000 33 110,750 48 120,000 67 147,325 102 160,000 101 210,000 95 150,000 466
Sixth 99,600 20 109,250 30 120,500 46 125,000 71 150,000 103 162,075 106 230,000 94 155,000 470
Seventh 116,000 14 110,700 25 121,500 42 127,775 66 165,000 95 170,000 105 237,250 86 165,000 433
Eighth 111,625 24 126,500 22 123,950 36 133,000 55 165,000 105 180,000 107 258,050 82 171,275 431
Summer Associates ($/week)
1st year 800 11 1,325 22 1,575 24 1,800 45 2,350 70 2,600 72 3,075 93 2,500 337
2nd year 1,000 22 1,550 29 1,800 45 1,900 79 2,400 91 2,700 101 3,075 112 2,400 479
3rd year 950 6 1,700 10 1,400 13 1,800 11 3,075 27 3,075 23 3,075 79 3,075 169

The "# Rept" columns indicate the number of offices reporting. Medians have been rounded to the nearest $25.

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About NALP: Founded in 1971, the National Association for Law Placement, Inc.® (NALP) is dedicated to facilitating legal career counseling and planning, recruitment and retention, and the professional development of law students and lawyers. NALP maintains an online archive of press releases at www.nalp.org — click on Research & Statistics > Press Releases. For additional information about NALP research, contact Judith Collins (jcollins@nalp.org), Director of Research, or James G. Leipold (jleipold@nalp.org), Executive Director, at 202-835-1001. Mailing address: National Association for Law Placement, 1025 Connecticut Avenue NW, Suite 1110, Washington, DC 20036-5413.

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