Morale concerns shift from layoffs to compensation

In a subtle shift that reflects the slow ongoing recovery from the recession that hit the U.S. legal services industry in 2008-2009, a new survey of law firm employees found that the most common staff morale concerns are now compensation levels and training resources, rather than looming layoffs in the firm.

ALM Legal Intelligence recently released “Turf Wars: Defining New Roles and Competing for New Territories,” a report that provides an overview of current staffing issues affecting AmLaw 200 law firms, the largest law firms in the U.S.

The report based on a survey of partners, associates, paralegals, support staff and law firm administrators.

The survey found that the top three factors currently working against overall law firm morale are: too much “deadweight” in the firm (34 percent); compensation too low compared to other firms (31 percent); and too much work for current staffing levels (31 percent).

“This is a dramatic change from our 2011 survey, when the top three factors cited as having a negative impact on morale were layoffs, bonus cuts and low compensation,” said Kevin Iredell, vice president of ALM Legal Intelligence.

The survey also found that, in the coming year, 62 percent of firms are likely to be hiring new attorneys.

However, 49 percent plan to reduce support staff, continuing a trend in recent years as firms strive to better leverage technology for greater operational efficiencies.
Other survey findings included the following:

• In the next three years, significantly more respondents foresee legal process outsourcing growing at their firms (19 percent) than what was reported in 2011 (10 percent).

• In the past year, nearly half of responding firms (47 percent) have promoted associates to Of Counsel, rather than to an equity partner position.

• Law firms’ biggest challenges when it comes to staffing requirements are hiring (27 percent) and retaining key talent (26 percent).

• The top three qualities law firms look for when hiring new associates is practice expertise (29 percent), followed by Ivy League or top law school graduation (26 percent) and GPA
(16 percent).