Just this past Monday, news broke of New York law firm Simpson Thacher's plans to hike first-year associate salaries to $160,000. Since then, David Lat's Above the Law has been abuzz with news of other firm increases, including Weil Gotschal; Fried Frank; Dewey Ballantine and Morrison & Foerster. And increases aren't limited to New York, either. Today, from Legal Pad comes news that Quinn Emanuel is also matching the $160,000 starting salaries in New York. The post explains that Quinn is concerned about losing talent to New York firms and that other California firms will need to consider this new trend.
Naturally, bloggers have weighed in on what these salary increases mean. Eric Turkewitz of New York Personal Injury Blog views the recent increases as a wake-up call for increasing judicial pay, noting that at $160,000 a year plus bonus, first-year associate salaries surpass those of federal judges (who make $162,500 annually).
Peter Smith of Counsel to Counsel warns that the $160,000 salaries may be nice, but there is a catch:
No, it is not just "more hours." Associates and partners alike are already putting in "more hours." What this really signifies is that the "class" distinctions between lawyers are widening, and there will be no reversal of that trend....
This means that competition for the best talent will only continue to spiral. But more importantly, there will be less and less room for error. Associates at premier firms are already walking across a tight rope. That won't change—although the wire is getting higher and higher. The real, rubber-hits-the-road change, is that the safety net for those who falter is getting smaller, and farther away. Why? The largest firms are not only international powerhouses, of course, but they are grabbing up the premier domestic work. The market of "safety-net" firms has, and will continue to shrink. Bottom line: blink and you will be out of the promised land, your salary will shrink by a third, perhaps more, and the doors to ground-breaking work will be increasingly closed to you. You'll be on the outside, looking in, and the glass is getting thicker. Enjoy the money. No pressure.