With the increase of legal costs to companies, one would expect a tremendous rise in the law firm headcount. Yet, here we are in the midst of a hiring freeze. What might be the reason and is there a silver lining for the 2025 batch?
Increase in legal costs? That's not something proportional to an increase in business for law firms YOY.
Firms usually face a high attrition every year, and hire A0s to over just that. So basically most firms have a 50 to 70 percent rate of people leaving yoy, mostly in house.
The problem is that this year large companies are cutting cost centres, the biggest being legal in house teams and not hiring as rapidly, thereby preventing attrition from these law firms. Without vacancies being created, there is no need for A0s really, but experienced people at some levels to actually run the deals. Hence the freeze.
Firms usually face a high attrition every year, and hire A0s to over just that. So basically most firms have a 50 to 70 percent rate of people leaving yoy, mostly in house.
The problem is that this year large companies are cutting cost centres, the biggest being legal in house teams and not hiring as rapidly, thereby preventing attrition from these law firms. Without vacancies being created, there is no need for A0s really, but experienced people at some levels to actually run the deals. Hence the freeze.