Robust and Cautiously Optimistic

2023 in review – How did the private practice recruitment market perform in 2023?

The boom experienced in the recruitment market in the two years immediately following the pandemic 2021/2022 were unprecedented and came, rather abruptly, to an end at the start of 2023. The aftermath of a boom and wider economic and political conditions resulted in a more cautious period. Primary transactional areas such as corporate and finance showed a sense of caution in regards to recruitment, at most large national and international firms, with some US firms announcing recruitment freezes. Litigious and niche practice areas showed more optimistic signs of growth. The slower pace continued through the first and second quarters of 2023 and into the summer months with an uptick in general recruitment activity from September onwards.
Although busier there was plenty of caution in the market with stricter measures put in place to ensure there was a real need to recruit in terms of utilisation and strategy.

Partner recruitment remained busy during 2023 with a significant number of partners leveraging their success from the boom to reconsider their options. There was also a continued interest in senior associates, with a strong business case, looking to move into first step partner positions.

Salaries rose at a steady pace as firms continued to rebalance pay at all levels in response to the unprecedented nature at which salaries rose during 2021 and 2022. Not all firms have achieved a level of harmonization, as compared to their competitors, with the perception of inconsistent salaries still being a driver for many considering a move. The use of sign-on bonuses was less common than in previous years – although still used in exceptional circumstances where needed.

Conversations around hybrid working continued to dominate much of the legal press. The vast majority of firms continued to offer a range of hybrid options, generally a 50/50 arrangement or ‘in more than you are out’, in other words ‘3 days in the office please!’ Whilst the press continued to report on firm’s hybrid arrangements, particularly the unpopular schemes, most firms continued to provide a degree of flexibility across practice areas and levels to take into account individual circumstances with an acknowledgment that there is no one size fits all solution for hybrid working.

The private practice market in 2024 – Robust and Optimistic

This year has already shown promising signs of a strong market, for at least the first six months of the year, with a continuation of increased recruitment activity that we saw at the end of 2023. There is a greater range of firms looking to recruit across a broader range of practice areas, including an increase in opportunities from US firms, predominantly in growth mode. Whilst we are cautiously optimistic for the year ahead, sign-off and business cases for roles continue to be carefully scrutinized. Firms are also taking time to find the right candidate, who ticks every box, resulting in longer more time consuming processes. There continues to be an interest in candidates that are able to support firm’s strategic growth plans, in terms of a portable and quantifiable following, from first-step to established partners, with these candidates often receiving multiple offers.

Salaries – What do we expect to see

Salaries are expected to increase at a steady pace although it remains to be seen which, if any, of the magic circle firms will be the first to report increases following the recent salary rises from US firms that follow the Cravath scale. This will undoubtedly create a ripple down effect through the magic circle and global elite firms. It is expected that firms won’t respond to these changes until later in the year in line with their normal salary reviews. Further headline grabbing salary increases centred around newly qualified rates are expected to continue throughout the year ahead. Salaries at a senior level (beyond circa. 5PQE) are expected to be more nebulous in nature and it’s likely to be where the greatest disparity exists.

Hybrid working – The story continues

Conversations around hybrid working are expected to feature significantly over the course of this year as firms remain keen to increase attendance in the office, with some firms already reporting that attendance in the office is now being monitored with more robust measures. Hybrid working has very much become a commodity in the context of recruitment, that sits alongside other variables such as salary, work-life balance, and opportunities for progression. Given the candidate driven nature of the private practice market, and firms often competing within the same small talent pools, bespoke hybrid arrangements are still being used as a recruitment tool, especially for those highly sought after candidates who are keen to replicate their hybrid working arrangement.

Overall Assessment for the year ahead

Our overall assessment of the year ahead, as we edge closer to the end of the first quarter, is that 2024 will be a positive year for candidates considering their options. We are confident that there will be a range of options at all levels across practice areas, with the expectation that future opportunities will increase as the uptick in associate recruitment continues. We also expect that the levels of associate recruitment will increase as a result of a significant number of partner hires made last year –  once these partners are embedded into their new firms and are showing positive signs of growth in line with their projected business plans.

If you are an associate or a partner considering their options and would like a realistic assessment of the opportunities within your practice area please contact one of our consultants for more information. All of our consultants are highly trained and experienced to provide advice to associate and partner candidates on market trends, salary benchmarking, interview preparation and CV and business plan reviews.