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Legal Layoffs Relatively Few So Far

published August 13, 2008

By Author - LawCrossing
Published By
( 52 votes, average: 5 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.
08/13/08

<<The National Law Journal recently examined the most recent law firm layoffs, and the picture is not quite as bad as news stories have sometimes implied. Since October of 2007, there have been a reported 338 individuals laid off from the top 250 law firms, with only 12 of those firms accounting for all the cuts.


Of course, that's not the full story. Law firms are a conservative lot when it comes to announcing bad news, and announcing layoffs is something firms are traditionally very reluctant to do. Such an announcement can negatively impact a firm's reputation and recruiting, among other things. For instance, who would want to go to Cadwalader right now?

So, most firms try to do "stealth layoffs," meaning that they cut people and simply don't announce it. This procedure is becoming increasingly risky, however, with the rise of blogs that can ferret out those kind of moves and expose them. Being caught making stealth layoffs is really bad — just ask Paul Hastings, which caught a firestorm of bad publicity when they tried it.

Still, most layoffs are stealth ones. All the same, even if it is assumed that three times as many attorneys are laid off stealthily, that'd still be a small number overall since last October. Attorney layoffs in the last ten months equal about 3.5 percent of the total number of attorneys at the 12 firms (of the 250 largest firms) reporting layoffs. It's fairly safe to say that the other firms aren't laying off substantial numbers, either, as any large cuts would have been found out.

Why so few layoffs, then, when all you hear is doom and gloom? One word supplies the answer: diversity. Diversity of practice areas have enabled most firms to weather the crisis, which has been mostly limited to one sector of legal work so far. Cadwalader, for instance, was heavily exposed to the mortgage crisis and has suffered as a result. Most firms don't rely on one practice area so much. Cadwalader has been forced to lay off 18 percent of it's workforce so far since last October, an unusually high casualty rate.

The law firms reporting layoffs so far:
Blank Rome
Cadwalader, Wickersham & Taft
Dechert
DLA Piper
McKee Nelson
Patton Boggs
Pillsbury Winthrop Shaw Pittman
Powell Goldstein
Sonnenschein Nath & Rosenthal
Sutherland Asbill & Brennan
Thacher Proffitt & Wood
Thelen Reid Brown Raysman & Steiner
These may be firms you wish to avoid in a job search! At least, that is, until they are clearly back on their feet.

published August 13, 2008

By Author - LawCrossing
( 52 votes, average: 5 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.

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