I have been in the legal profession for many years and currently work as a legal recruiter for over two decades, so I know a thing or two about the legal industry. And what I have noticed is that every law practice area goes through waves and temporarily self-destructs itself approximately every eight years. If an attorney is caught in this situation, it can have fatal consequences to their legal career. Read on to find out when and why are particular practice areas affected and what you can do to have the best chance for a stable job.
Why Do Practice Areas Slow Down and What It Means for Attorneys?
Practice areas slow down regularly and there is nothing that can be done about that. About one third of these areas because of the law firm structure are very connected to the state of the economy and financial market so they slow down because of economic forces. Others in the legal industry are connected to other markets in the geographical area and are affected as well. People within the traditional partnership model and their seniority levels can also slow practice areas down. There are many forces that affect legal practice areas and no area is free from danger.
When this happens, most attorneys practicing law in the affected area could no longer do so and have difficulty finding a new one. This is because senior partners must decide in most law firms to let some associates go to remain viable. This can last a few months or a year for a law firm; however, the area might be affected for several years if not a whole decade.
As this happens approximately every eight to ten years, if an attorney sticks to their area for more years, they will inevitably be affected. Some are unlucky and it hits them just as they are graduating from law school and starting their legal career, which is usually devastating. Others have more luck and are able to build up some experience and contact list before their area dies down and their position is endangered.
Many unfortunately live with the naive idea that if their area is currently booming, nothing can happen to them. They have worked hard in their prestigious law school, had great academic results, got a position in a prestigious large firm, and are now billing thousands of hours and working their butt off to ensure that they have a setup path to success and advancement. However, this self-destruction inevitably happens and everything they have worked for all these years disappears within a few days.
When this happens, attorneys do not have a lot of great options. Finding a legal placement is almost impossible. They might find some positions in smaller law firms or in smaller legal markets. However, many attorneys are forced to change practice settings and become in-house corporate counsel, start their own law practices, go to government offices or non-profit organizations, and some even change their profession completely. Some go to business school to be able to successfully start their own business, but I have seen also attorneys from wonderful law schools that had to start working in restaurants or shops for a minimum wage. This change in position also inevitably comes with a lower salary, so many of these lawyers have to move to smaller flats, and some even back with their parents because they are not able to sustain themselves. Mental health issues and dealing with this stress and feelings of failure with substance abuse are also not uncommon. This can happen to anyone. Not even senior associates from top firms or even partners are safe.
When the affected practice areas start to pick up their speed again, the situation does not get much better for the attorneys who were let go. Even when they are qualified, law firms do not want to re-hire attorneys they previously fired. Other firms do not want to hire attorneys who were let go by a different firm as well.
When something like this happens, attorneys in that area lose their jobs in a short period of time and they never get back into that law firm. Some law firms do not want to hire these attorneys either because of a bad employment track record and they have been let go. For those who were able to keep their jobs, advancement is almost impossible and attorneys on the partner level can very easily lose their equity partner status. Many law firm partners lose their partner position altogether. Unemployment grows very quickly and can last for years, so attorneys are forced to relocate, change practice settings, or change careers. They often move back to their hometowns and have to start again from the bottom.
Find out how to cope best as every law practice area self-destructs itself periodically:
Litigation
Litigation is one of the most at-risk practice areas and the state of the area can go south very easily. Litigation attorneys are often at risk of suddenly not having work at any time.
I have spoken to many litigation lawyers who were hopeful when they were able to get big clients with huge cases, billed thousands of hours to finalize the litigation but were let go once these issues were resolved and there was not enough work to be done. After something like this, other law firms did not want to hire them because they were already fired and firms often have hundreds of litigators queuing for every position. It can be devastating.
Litigation is a practice area that is very dependent on the state of the economy and economic movements. Unlike some other practice areas and other companies, litigation tends to thrive the most when the economy slows down and gets into a bad shape. It is understandable because, during economic slowdowns, most people and companies are losing money, so they are looking for ways to recover some of it.
Many companies that were doing very well when the economy was booming are also struggling during an economic downturn. They are the perfect clients for litigation law firms and attorneys. These firms persuade them to sue their banks or anyone who might have wronged them and cost them money they now need. These litigation firms and attorneys then bank huge checks thanks to contingency fees or high hourly rates.
Did someone advise a company to invest in stock options that turned out as a money-losing machine? Did a bank manipulate the company's investments in a way that was not as profitable as they expected? Sue them all! It is a golden age for litigation. Many people and companies get sued during times of economic downturns.
Many attorneys who are fresh out of law school during the time when litigation is booming are employed as litigators in every legal market there is. Corporate law will not do that well when the economy is slow, so law students and attorneys understandably start out as litigators. Established law firms and partners in these firms also become dependent on their litigation departments as those are the only ones bringing in any significant money. This is often a huge hit for law firms, who were used to bringing in their own business.
The year 2022 brings in new challenges for litigation, according to Bloomberg Law Research. In a published report, Bloomberg Law said that coming in the third year of the COVID-19 pandemic might be challenging for litigation "to invoke it as a force majeure clause in court."
The Self-Destructing Cycle of Litigation
The cycle of litigation when the area is booming is almost always the same and in the end, leads to self-destruction. When everyone starts suing, litigation attorneys can increase their rates. They try to prolong the lawsuits and charge stellar sums to increase their salaries. Many litigators switch firms to get a "better deal" and get more money for all the business they are generating. After some time and a lot of client bills later, people start to realize that litigators are the only ones getting any money from these lawsuits. They suddenly start to settle all of their litigation issues to avoid paying any more money to the attorneys. Understandably, this situation and the high bills discourage companies from getting into lawsuits and suing anyone. That leads to litigation slowing down again.
The cycle gets to the point when there is no work for litigators. They are let go from firms, struggle to find positions in their specialized field, and are forced to either switch areas to those currently booming or switch careers completely to be able to take care of themselves.
Another issue with litigation is that the skills litigators need do not really get more technical or specialized with seniority. The core of what litigators need to do their job lies in their ability to research, write and argue in writing. A good junior associate is often comparable to someone with 10 years of experience in these abilities.
This is not really true in other areas, such as tax, patent, or corporate law. The skills in these areas get more technical, sophisticated and specialized with experience. Senior attorneys are more skilled and proficient, which makes them more marketable and employable. Firms are looking hard for attorneys with these specialized skills because there is not a lot of them, so when they find them, they are not that strict with the attorney's background.
In litigation, every attorney has almost the same level of skills and there are a lot of litigators everywhere. That means that every law firm is extremely picky with the attorneys they choose to hire. Everything in the background matters - the quality of the law school, academic results and rating, previous employers, etc.
Corporate Law
Corporate law is dependent on the economic situation as well; however, when the economy is booming, corporate law is doing great as well. When the economy slows down, corporate lawyers are in big trouble.
Approximately every eight years, the economy slows down significantly or there is a recession. When this happens, every corporate lawyer becomes unemployable. It does not matter what credentials they have, corporate law is dead during economic downturns. I have seen attorneys who were at the top of their class at Harvard Law School who could not find a legal placement when corporate law was slow. Many attorneys lose their jobs and become unemployable.
During the recession in 2008, corporate law was in extremely bad shape. There was no work for corporate lawyers for a long period of time. They sat behind their desks without anything to do for months and once the firms could not afford to keep them on for any longer, they started to let them go. The ones with the worst credentials went first, of course. And as the work did not start coming in even after months, they went up the ranks and even attorneys from second and first-tier law schools started to be let go.
When the economy is booming, many corporate lawyers, even those who do not have the greatest background, get hired in major law firms because there is a lot of work to be done. This changes drastically when the economy slows down. Suddenly, there is no work, so firms have to start letting attorneys go. The ones with not such a good background go first.
This happens in cycles and the same thing repeats every few years. If you are one of the corporate attorneys in good law firms who do not have stellar credentials, you can expect to be among the first to be let go once the economy slows down. It would best to upgrade your skill set while employed in house in a a law firm whether big or small while the economy is booming.
When there is lack of work in a law firm, some corporate lawyers who have an accounting or any business degree or a bachelor's degree maybe, could temporarily switch careers until such time that the industry bounces back.
The caveat though when a lawyer changes careers, there is an apparent need for a law review, if they decide to go back to the profession. A general counsel for a company needs to be thoroughly familiar in corporate law existing for every state and jurisdiction.
Real Estate Law
Real estate law has had a good run for several years now and it has not slowed down for quite some time.
However, when I started in the legal recruitment business over two decades ago, the area was not doing so great. I had many real estate attorneys calling me because they were out of a job for months. No one wanted their legal services.
I started working with a real estate attorney who could not find a position for several years. After a few weeks of hard work both of us did, he was able to get an offer from a large law firm. However, they offered him significantly less money than was standard for someone with his experience. I was shocked and tried to object to the firm. The law firm, of course, knew this but they also knew that they had the only opening in the market for a real estate attorney and they could offer what they wanted. Even though I thought it was crazy, the attorney was extremely happy that he was able to secure a position when the practice area was in a bad shape.
The state of real estate law is dependent on various things. It usually does well when the interest rates are low. The economic situation plays a role but it also depends on geographical forces and other things. That makes predicting when the area will slow down extremely difficult and real estate lawyers have to be prepared for the area freezing up any time. When that happens, the real estate attorneys are at a big risk and should be prepared beforehand.
Trademark Law
The trademark practice is usually active when many businesses are starting and they need a lot of trademarks. When no new companies are being established, trademarking is usually not needed and the area gets slow.
When trademark law picks up, a lot of junior trademark attorneys get hired in many law firms as in-house associates . However, they are the first to go when the economy slows down and people stop opening new companies. Even if a trademark attorney keeps their job when the economy slows down, one should keep their options open and prepared to tackle new tasks in international law trademarks in order to keep practicing. Large firms have big international trademark offices world-wide and could hire them as in house law specialists assigned in subsidiaries or affiliates in other countries.
Patent Prosecution
Patent prosecution is very interesting to study. Patent prosecutors have certain employment stability these days especially in the online market and vast internet of things if they can show that they are willing to work hard to protect the interest of their firm and their clients.
The most active sections of patent prosecution are always in the engineering, physics and hard sciences, although, it has slowed down a bit in recent years. Even though it is still an active practice area, there are a few things to be wary about.
There are areas of science patent prosecution that can slow down easily and will take down any patent prosecutors in that area with it. In recent years, many of the work had been limited in the Bay Area. Positions in other areas are at risk whenever patent prosecution slows down even a bit. Many patent prosecution departments rely on only one big client and that can be their downfall. If this client decides to switch firms, the prosecutors lose their jobs.
The other thing with patent prosecution in any branch or field is that education matters. Patent prosecutors with a PhD. will always be more in-demand than those with lesser education. If an attorney does not have a PhD., they have to be prepared or be replaced by someone who has.
Patent prosecution in life sciences suffers from the same issues. Some areas of drug patent prosecution pick up out of nowhere and slow down as quickly as they started. Apart from the Bay Area, patent prosecution in life sciences is also quite active in New Jersey, San Diego or Washington DC.
Patent prosecution operates in many different fields, so slowing and activating differ for patent prosecutors based on the field they are in. Currently, electrical engineer patent prosecution is booming because of the internet age. Before that, machine engineering was more in-demand. Drug patent prosecution is usually booming when the economy and governments invest in and protect drug development. At this time of the coronavirus disease 2019 (COVID-19) pandemic, there is more work for patent lawyers for drug patents these days. Pharmaceutical firms at the start of the COVID-19 pandemic were in need of in house lawyers as they prepare for patent prosecution because the race to discovering effective vaccines and other medicines to cure COVID-19 is far from over.
An important note to make is also that patent prosecutors are cruel and cunning toward other partners. I do not know why and it probably does not have a single explanation, but it is a thing to have in mind. It is now quite lucrative to be in the field of patent law if your law firm is highly valuable and knowledgeable in this field.
Labor and Employment Litigation
Labor and employment litigation is also dependent on the economy. When the economy is good, most people can easily find jobs and do not have reason to look for labor and employment attorneys. However, when the economy slows down, people start to have trouble getting employed and also start suing those who they think wronged them.
Because of this, there are usually much more positions for labor and employment litigation when the economy is slow. Even though there is still some work to be done when the economy is doing well, this work is less sophisticated, thus it is often done by the in-house general counsel or smaller less expensive firms.
Bankruptcy Law
Just like litigation, the bankruptcy practice area is highly dependent on the economy - when the economy is booming, there is not a lot of work for bankruptcy lawyers, when the economy slows down, the area picks up.
The issue with the bankruptcy practice area is that bankruptcy lawyers often get their work from one big client. When they finalize the work, they are left without anything else to do and have to start looking for a new placement. However, the nature of the job allows them to relocate to different states, which might ease the consequences of the practice area dying down in one legal market.
Tax Law
The tax law practice area is also dependent on the economy. When the financial market and economy are doing well, tax lawyers get hired in swarms regardless of the fact that they are coming from an accounting firm or an LLM program. There is a lot of work to be done and law firms want all attorneys who will be able to help them.
However, when the practice area slows down, this changes drastically. The requirements for tax lawyers get higher because there are only a few positions open for them. Law firms do not want to hire any attorney coming from an accounting firm. They only want attorneys with the best qualifications.
Immigration Law
Large law firms tend to have the most immigration work when the economy is doing well. During these times, companies are expanding and hiring people from around the world. This is often happening in the technology sector.
Conclusions
Unemployment is the worst thing that can happen to an attorney. The best and most important thing they can do throughout their career, especially if they are working in a large law firm, is to stay employed at all costs. It is not an easy task to do. There are many different forces in every practice area that work against attorneys keeping their jobs. However, knowing about these forces and knowing that in a regular large law firm model, an attorney has to stay on top of their game can help lawyers stay employed and avoid the mistake of losing their job even when the state of the practice area is not on their side.
