Law Firm Recruitment Sees A Sharp Decline Amidst Staff Layoffs and Reduced Demand

Lateral Hiring Trends


Lateral hiring in law firms witnessed a significant decline in 2023 across all ranks, marking a stark 35% drop compared to previous years. The National Association for Law Placement's (NALP) latest report reveals that associates experienced the most significant setback, with a staggering 45% decrease in lateral hiring.

Factors Contributing to the Downturn

The downturn in lateral hiring represents the second consecutive year of tightened recruiting in law firms, following a surge in demand during the pandemic. Slowing demand from corporate clients prompted several major firms to implement layoffs, scale back recruiting efforts, and reduce staff.

Impact on Associate Ranks

Summer Eberhard, a legal recruiter at Lateral Link, noted that law firms learned harsh lessons over the last three years regarding building up associate ranks. The exponential growth in 2021 was not sustainable as work declined, leading to an excess of attorneys.

Decline in Corporate Practices

The decline in lateral hiring was particularly pronounced in corporate practices, traditionally the most active area for hiring among firms. While there was a slight uptick in litigation, it was insufficient to compensate for the decreased demand in corporate areas.

Partner Hiring Trends

In contrast to associate hiring, partner hiring experienced a less severe decline. Stephanie Biderman, a recruiter at Major, Lindsey & Africa, explained that partners with portable books of business drive most partner moves, while associates serve as leverage for that business.

Prospects for the Future

Despite the challenges, there has been increased activity in the last few months, especially in finance-related roles. Recruiters anticipate firms gearing up for more lateral hiring, albeit not at the same pace as in 2021.

Summer Program Cutbacks

In addition to reducing lateral hiring, firms have also downsized their summer classes. NALP's separate report indicates that firms anticipate the lull in demand to persist for the next year or two.

Potential for Further Layoffs

NALP's executive director, Nikia Gray, warns of possible layoffs in the coming year, citing firms' reluctance to maintain excess capacity. Quick termination decisions for performance issues may become more common as firms adjust to market conditions.