Biglaw firms were once eager to hire numerous associates and business professionals during the prosperous years following the pandemic. However, as demand has significantly decreased, these firms have been compelled to implement layoffs to align their headcount with the current market conditions.
Recently, Dechert, a prominent firm that generated $1,288,692,000 in gross revenue in 2022 (a 3.94% decline from 2021), ranking it as No. 36 in the latest Am Law 100 list, announced a global reduction in force. This measure cut 5% of the firm's workforce, including attorneys and business professionals. The total number of individuals affected by these layoffs amounted to 55 lawyers and 43 business professionals.
What led to the sudden surplus of employees at the firm? According to a source cited by the American Lawyer, it appears to have resulted from excessive hiring.
One source with knowledge of the firm attributed the cuts to overhiring. After a surge in demand that led many law firms like Dechert to hire associates beyond the normal scope of its hiring pool, “demand is returning to normal or maybe worse than normal, depending on how deep the recession goes,” the source said.
As per Am Law, the recent 5% reduction in Dechert's workforce is expected to bring their staffing levels back to approximately where they were in 2021. By the end of that year, the firm had 1,815 employees, and with these layoffs, the personnel count will be reduced to 1,798. It seems rather convenient, doesn't it?
