It appears that law schools and business schools have nothing to worry about, and may actually see a silver-lining in the economic cloud. Registrations for the LSAT are up 6.2% and GMAT registrations are up 10.4%. For more information click here.
In the long run, law firms will also benefit. The biggest contributor to current high associate salaries, was the war for talent caused by flat law school admissions. Will that continue to be the case? It doesn’t look like it. Combine increased law school enrollments with lay-offs, and firms will be able to pick and choose who they hire and at what price.
Does that question send chills down your spine? At a recent symposium on legal education, Professor David Chavkin of the University of Washington School of Law, put it this way:
“If the goal of medical school were to teach students not how to be doctors, but how to think like doctors, would you want to be a graduate’s first patient?”
Practical legal education has been a topic of discussion for at least the last 20 years, but the noise seems to be growing louder and louder. In today’s world of increased competition, the need to hit the ground running and be immediately productive, is extremely high. Those new lawyers who were exposed to the actual practice of law, are bound to be more successful than their counterparts.
While law schools continue to add more clinics and practice-based classes, I would argue that it is incumbent upon law firms to implement comprehensive training programs that address the needs of new lawyers, including legal research and writing. Surveys show that new lawyers will spend 80% of their time in the first three years on legal research and writing. If that is true, then sharpening those skills is even more important than almost anything else.
The results of the 2008 survey were published yesterday, and there are some surprises given what’s been in the news. First, 38% responded that they are “optimistic” about 2009. Second, 72% expect their firm headcount to increase over the next year. And third, 58% expect their 2009 first-year associate class to be the same as 2008 or larger.
However it wasn’t all good news, with associate retention still an issue.
How much of a problem is associate retention for your firm?
A major problem 7%
A minor problem 46%
Not a problem 46%
Additionally, most clients are showing continued cost-sensitivity to law firm billings.
What changes are you currently seeing in client behavior regarding billing?
More clients are requesting discounts 75%
Clients are paying bills later 65%
Clients are requesting deeper discounts 51%
Multiple responses were allowed.
There have been so many changes to the practice of law over the past five years, with the ubiquitous nature of the Internet being one of the most important. It looks like these changes could have a major impact on law firms in 2009.
Some high-profile general counsel have suggested that due to the advent of new technology and increased commoditization of legal services, many, if not most, Am Law 200 firms will have to change their business and billing practices. Do you agree?
The full results can be found here, and the article here.
I found a link to this intriguing article from Ad Week on the (non)billable hour blog. Although the article is focusing on graduates in the marketing field, the author’s observations apply to 20-somethings generally. We’ve been hearing about this generation for the past few years, but have law firms adapted? Are we ready for this generation and the next? As Matt Homann points out on his blog…”love ’em or hate ’em, they’re not just your children, they’re your future clients, employees and partners.”
Here are some interesting quotes from the article:
How they live has everything to do with how they work. They time shift. Favorite shows happen online on-demand. News is 24/7. There’s not much use for e-mail. Instead, they’re YouTubing, Stumbling, Digging, Twittering, blogging, updating. They’re Loopted and LinkedIn. Caffeine drives the day and night. In this world, wristwatches and alarm clocks are as necessary as rabbit ears. They grew up IMing, and the cell phone rules. Area-code identity is mobile but long lasting — a virtual network.
All this makes them, at their best, unbelievably creative and productive. On the other hand, they also think they have all the answers. Morley Safer wrote recently of this generation’s entitlement issues: They’ve grown up with everyone as winners, with inspired birthday parties and planned events, with middle-class privilege and opportunities at every camp, academy and take-your-kid-to-work experience. They expect careers, not jobs.
Buckle up. This group does not look or work the same as generations past.
To read the article in its entirety, click here.
In an article earlier this year, Big Firm Associates: Why They Go and How to Keep Them, I found a very interesting quote: “…most importantly, firms could spend as much time on professional development as on marketing.” I don’t know if firms are using this type of benchmark to measure the amount of resources committed to professional development, but it is an interesting idea.
The link between retention and professional development is one that makes sense, and inspired us to develop a workshop series to help firms. Visit our site to learn more (prepare2practice).
Two recent items about “work/life balance” that were in the news caught my eye. First, Balch & Bingham, an Atlanta-based firm, is allowing staff to work four 10 hour days. For a temporary period of time, staff can choose to take off Tuesday, Wednesday or Thursday. This came about when the managing partner overheard a secretary asking to leave early so she could get in line at a gas station. The managing partner says that this just makes sense right now “from an efficiency and productivity standpoint.” ABAJournal
Second, Calfee Halter & Griswold in Cleveland just announced that they will be providing a wide range of services to firm personnel as part of a new program called Calfee Lifestyle Resources. Employees will pay for the goods and services and the firm will cover the delivery costs. The services include grocery and prepared-meal delivery, dry-cleaning, shoe repair, fitness classes, office organizational consulting, and stamps. Calfee’s managing partner states that “Calfee Lifestyle Resources is a way for the firm to give “the gift of time” to those who might put in 60 to 90 hours a week.” He goes on to say that, “if things aren’t getting done at home, I’m distracted at work. If I’m happy, I’m going to be more productive.” Cleveland.com
I think that both of these programs are commendable. They demonstrate that a law firm can respond to the needs of its employees and fashion solutions that make their lives easier. From a cynical standpoint, one could say that “self-interest” (e.g. more time at work billing clients) is the only motivating factor, but I think we need look beyond that. Law firms are for-profit businesses, and every decision is made to further the business, from cleaning the carpets to providing extra services to employees. So let’s not look a gift horse in the mouth, and instead hope that other firm’s follow these examples.