Trainee solicitors are the highest paid graduates in the UK, according to an Association of Graduate Recruiters (AGR) survey published last Tuesday (8 July).
The median starting salaries for trainee solicitors in 2008 is £36,500, putting law ahead of investment banking for the first time, according to the AGR summer survey.
The median graduate salaries paid by investment banks and fund managers is £35,000. The average graduate salary across all sectors has increased by a modest 1.8 per cent from £24,063 in 2007 to £24,500 this year.
Simon Pilcher, graduate recruitment partner at CMS Cameron McKenna, said he was not surprised by the survey’s findings, but added: “I’m not sure that this will be sustained in the long-term. Investment banking salaries track prevailing market conditions more closely than those of law firms.”
Many of the larger employers in the legal sector, however, pay their first-year trainee solicitors above the AGR average, despite a number of large City firms announcing below-inflation pay rises for their junior lawyers.
As highlighted in the Lawyer2B.com salary index, magic circle firms Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer and Linklaters pay their new joiners £37,000, £37,400, £39,000 and £37,400 respectively.
US firms, including Bingham McCutchen, Cleary Gottlieb Steen & Hamilton and Debevoise & Plimpton, pay their first-year trainees £40,000, while trainees joining Weil Gotshal & Manges and White & Case will receive starting salaries of £41,000.
That said, in a post on TheLawyer.com one reader warned that the good times for law firms are also on the way out.
“I think we’re going to be in for a period where costs will become a real issue for law firms, so I doubt there will be any great uplift in lawyer salaries for at least the next six to 18 months,” wrote the user.
Baker & McKenzie graduate recruitment partner Vincent Keaveny agreed.
“The big jumps in trainee pay during the past decade have often been triggered by external factors such as the dotcom boom,” he said. “There are currently no such pressures to boost salaries. That said, firms still have to be mindful of what their competitors are paying. Investment banking is a career with real peaks and troughs. During the peak periods the pay is very good, but bankers do have to work really hard for it. But when things go down it can get very bad.”
The credit crunch has not impacted on the number of graduate positions available, according to the survey, which revealed that vacancies for university leavers will rise by 11.7 per cent compared with 2007.
Although growth in vacancies ;has ;slowed slightly, almost three-fifths of employers surveyed by the AGR expected to report an increase in vacancies in 2008.
The top recruiting sectors continue to be accountancy and ;banking, ;which between them offer more than a third of all vacancies. The legal sector, meanwhile, makes up 7.4 per cent of the vacancies at AGR members.
The AGR survey also concluded that competition for graduate jobs is intensifying, with just over 30 applications per vacancy. Law firms, however, reported that they receive on average 26 applications per vacancy compared with the banking and financial services sector, where this figure is 34. The fast-moving ;consumer goods sector is the most competitive, ;with ;112 applications per vacancy.