An uncertain economic forecast is motivating a number of Biglaw firms to make layoffs as 2023 begins, a development that experts say could result in opportunities for middle market firms to add top talent to their rosters.
“Middle market firms who have operated and managed themselves conservatively throughout the Covid-19 pandemic are now in a prime position to capitalize on these layoffs,” says Elaine Oh, Senior Legal Recruiter at The Foster Group. “With the right approach, they can attract high-quality laterals from Biglawfirms.”
The Foster Group is a leading full-service legal recruiting firm that works with attorneys looking to advance their careers, as well as law firms and corporations looking for talent to support their strategic growth and service their clients. Its team has decades of specialized experience in the placement of partners, counsel, and associates.
Lawyers should not overlook opportunities at middle market and smaller firms
The team of experts at The Foster Group believes that middle market and smaller law firms have plenty of opportunities to offer lawyers who have recently been released from Biglaw firms. For boutique,midsize and middle market firms, these include better mentoring and advancement opportunities as well as better work-life balance. Boutique,midsize and middle market firms also provide lawyers opportunities for greater responsibility earlier in their careers, such as trying cases or taking depositions.
Michelle Foster, Founder and Managing Partner at The Foster Group, points to the different approaches to billing rates as another factor that can attract lawyers to this broad swath of the market.
“There is greater opportunity for business development at middle market firms because there is more flexibility on billing rates, which is attractive to partners who are looking for platforms to continue growing their business,” Michelle explains. “Many of the partners we work with want to take their practice to the next level and simultaneously keep their clients happy by not raising their billing rates past the point where clients are comfortable. That is an opportunity they do not always find at Biglaw firms, many of whom only want the choicest work at the highest rates . Likewise, for associates, rate flexibility at middle market firms enables younger attorneys to start building a practice.”
With law firms, bigger is not always better
Geoff Scollard, Director of Recruiting at The Foster Group, says lawyers who have been affected by layoffs should not assume that moving to a smaller firm means receiving less compensation.
“Oftentimes, partners at firms that are higher up on the Am Law list are hesitant to consider moving downstream under the assumption that their compensation cannot be matched,” Geoff says. “This is not always the case; in this market, we are seeing more and more middle-market firms beating offers from upper-market counterparts. Bigger is not always better.”
Geoff advises firms looking to secure lawyers who have been laid off by larger firms to consistently offer lateral partners compensation on par with that of upper-market firms and to develop a reputation for doing so. He also says middle-market firms should focus on growing their smaller offices and expanding their footprint.
“It can be valuable to establish a presence in territories outside of the major legal hubs where overhead is lower and where firms can provide greater value to middle-market clients,” Geoff says. “It is also important that firms keep their rates competitive in those regions. More and more firms seem to be adopting national rates, regardless of their location, which makes it challenging for partners in emerging markets to retain clients who are used to lower regional rates.”
Legal recruiters can provide invaluable guidance
For attorneys who have been laid off and the firms who have opportunities for them, legal recruiting firms can serve as an invaluable resource in this season.
“The work we do with middle market firms often involves lengthy and in-depth discussions with their key decision makers, giving us unique insights on the opportunities that are available, the career paths they offer, and the culture they promote,” explains Drew Foster, Managing Director at The Foster Group. “The access that we are given to that type of information is a key factor in our ability to effectively provide legal recruiting guidance. Laterals want to know real information about the opportunity, not standard facts pulled from a firm website. We have access to that information, which makes us a valuable partner to lawyers considering a search as well as law firms looking to hire strong talent.”