NALP Bulletin, April 2020

Lateral hiring volume decreased sizably during the recession in 2008 and 2009, and then experienced a substantial rebound as the legal economy recovered in 2010 and 2011. In the eight years since that recovery, changes have fluctuated from double-digit losses to double-digit growth. In 2019, aggregate lateral hiring was relatively stable, down by just 0.7 percent compared to 2018. This follows an aggregate increase of more than 14% from 2017 to 2018. While overall lateral hiring declined ever so slightly in 2019, partner lateral hires were up 1.4 percent over 2018. However, decreases in lateral associate and other lawyer hiring, down 0.9 percent and 2.7 percent, respectively, drove the overall decline.

Overall, lateral hiring averaged 16.4 lateral hires per office/firm in 2019, down just a bit from 16.5 in 2018; however, the median number of lateral hires increased to eight in 2019 compared to seven in 2018. Nearly 46% of offices/firms reported an overall increase in lateral hiring in 2019. Volumes and per office figures varied greatly by firm size and geography, with the highest figures recorded, perhaps not surprisingly, in New York City, where the average was almost 20 and the median number of 16 was twice that of the national median. In contrast, offices in San Diego reported the lowest lateral hiring figures, with an average of just above four. These are the overall findings about lateral hiring from NALP's "Survey of Legal Employers on 2019 Recruiting," which requested information from law firms on lateral hiring in both 2018 and 2019.

The results shown in Table 1 and Table 2 are based on data from 459 law offices that reported at least one lateral hire in either 2018 or 2019. Table 1 reports aggregate information for partners, associates, and all other lateral lawyers. Table 2 shows lateral partner and associate hiring, which accounted for 83% of the lateral hiring reported for 2019, and includes cities and states with at least five offices reporting office-specific information and collectively reporting at least 25 lateral hires in 2019.

Key Findings:

• Overall, based on aggregate hiring information on over 7,500 lateral lawyers in 2019, the volume of hiring was down 0.7 percent compared with 2018 in these same offices/firms, with a median of eight and an average of 16.4 lateral hires per office/firm (Table 1). Despite an overall small dip in total lateral hiring, partner lateral hiring was actually up just over one percent, while associate lateral hiring was down by just under one percent. The average number of lateral associates hired per office/firm in 2019 was approximately 10 and the median was five compared to an average of about three and a median of one for lateral partner hires. Lateral associate hiring accounted for 63% of lateral hiring in 2019 and lateral partner hiring accounted for 20%. Other lateral hiring comprised 17% of lateral hiring in 2019, and, as the median figure of one suggests, many offices did not do any hiring of this type in 2019. Aggregate hiring in this category was down the most, by nearly three percent.
  
  
• However, as Table 2 shows, changes in aggregate hiring and the level of hiring, measured by either the median or average number of hires, varied considerably by both firm size and geography. For example, for firms reporting their lateral hiring on a firm-wide basis (in the section of the table labeled "Firm-wide Reports"), lateral hiring as measured by medians ranged from 10 - 72.5 depending on firm size, and changes in aggregate volume ranged from a decrease of about two percent to an increase of nearly six percent. Lateral hiring by region ranged from a volume decline of nearly 22% in the Northeast to a volume increase of 15% in the West/Rocky Mountain region. (Regional figures in this section of the table reflect firms reporting firm-wide information, but whose offices are wholly or predominantly in one region.)
  
  
• Among offices reporting activity for a single office, offices averaged from less than 1 to 2.2 lateral partner hires depending on firm size, whereas associate lateral hiring averages ranged from 3.6 to 6.8 per office. Firms of 500 or fewer lawyers saw overall gains in lateral hiring, while larger firms of 501 or more lawyers experienced overall declines in lateral hiring volume.
  
  
• On a regional basis, the level of lateral hiring per office was highest in the Northeast, with a median of 13.5 and an average of nearly 19 lateral hires in 2019, compared with medians of four to eight in all other regions and averages that ranged from about six to 10. In terms of change in aggregate volume, however, volume was down by 19% in the Southeast and up by almost 10% in the Mid-Atlantic region. The median number of lateral hires was also highest by far in New York City, at 16, followed by Atlanta at 10.
  
  
• Among cities reporting at least 100 lateral hires in 2019 (Atlanta, Boston, New York City, Washington, DC/Northern Virginia, Chicago, the Los Angeles/Orange County area, San Francisco, and the Silicon Valley), lateral hiring declined in half of these cities, as shown in Chart 1. Los Angeles had the largest increase in lateral hiring volume (28%), while Chicago experienced the largest dip (-22%) in hiring volume. Interestingly, changes in lateral hiring volumes by city can fluctuate widely from year to year. For example, all four cities with declines in lateral hiring volume in 2019 reported increased volume ranging from 17% to 49% in 2018 when compared to 2017.
  
  
• Needless to say, despite the overall slight decline in lateral hiring, not every office or firm hired fewer laterals in 2019 compared with 2018. In fact, almost 46% of offices/firms increased their lateral hiring volume compared with 2018. The last column in Table 2 reports the percentage of offices that increased their lateral hiring in 2019. Among cities with at least 10 offices reporting, Miami (55%) and Washington, DC (53%) had the largest proportion of offices reporting increases in lateral hiring. In contrast, the share of Silicon Valley offices that experienced growth in their lateral hiring was just 21%.
  
  
• This year's survey results document a relatively stable amount of overall lateral hiring volume, following a large increase of 14% from 2017 to 2018. Survey results, of course, reflect the respondent pool for each year. Nonetheless, to the extent that the survey pool is relatively consistent with respect to firm size and location, it appears that the average number of lateral hires per office/firm remains well above the levels measured from 2008 to 2010, and the 2018 and 2019 figures were the two highest on record in this 17-year period. Though total volumes and changes in total volume have fluctuated, the general direction has been upward since 2010. The average has stood at close to 15 or above since 2015, shown in Chart 2 and Table 3. (For full results of prior year surveys, see NALP Bulletin columns posted at www.nalp.org/entry-levelhiring.)

Table 1. Summary of Lateral Hiring — 2019

Source: NALP Survey of Legal Employers on 2019 Recruiting

Table 2. Lateral Hiring in 2019 and Comparison with 2018

Source: NALP Survey of Legal Employers on 2019 Recruiting.
This table includes offices/firms which reported at least one lateral hire in 2018 or 2019 and which also reported complete information for both years. Collectively these 459 employers reported 7,537 lateral hires in 2019. Cities shown had at least 5 offices/firms collectively reporting at least 25 lateral hires in 2019. Following the overall total shown in the first line, the table separates out surveys which reported information firm-wide, or for multiple offices, from those which reported office-specific information. Firm-wide information by region includes firms whose offices are predominantly or wholly in that region. However, office-specific information includes some instances of firms with most attorneys located in that city or whose additional offices are located primarily in adjacent areas, and of multi-office nationwide firms consolidating two geographically adjacent offices onto one survey.

Table 3. Summary of NALP Survey Findings on Lateral Hiring — A 17-year Retrospective, 2003-2019

Source: NALP Survey of Legal Employers on Recruiting, 2003 - 2019