US firms’ results soar while Dewey cave-in sparks hire-mania
If you happened to land on earth from a recession-free planet this month and had a quick nose around top US law firms’ financial results for 2012, you could be forgiven for crying out: “Financial crisis, what financial crisis?”
That is because this year’s US reporting season has so far been jam-packed with cheery buzz-words that make 2012’s results sound like a rising cake.
Take litigation firm Quinn Emanuel Urquhart & Sullivan, which weighed in this season with an 18 per cent increase in gross revenue. Or Californian firm Cooley, which saw revenue in 2012 rise by 9 per cent – the second year running the firm has achieved growth of at least that level. And then there’s Dechert, which has so far boasted a 44 per cent increase in revenue at its London office (although it is worth noting that the firm is keeping the mystery alive by not releasing a turnover figure for its London base).
The financials make life at a US firm seem a beach, particularly if you’re an equity partner: average profit per equity partner (PEP) last year rose by 7.4 per cent at Latham & Watkins, 15 per cent at White & Case, 10 per cent at Pillsbury and 6 per cent at Paul Hastings.
Even if the bump-ups are marginal, the theme is consistency. The figures are going up, and US lawyers must be grinning like Cheshire cats.
But could one man’s joy be another’s sorrow? There is, after all, one US firm that did not spend 2012 stacking up the coins, that firm being the now-defunct Dewey & LeBoeuf.
It would not be presumptuous to say the overall increase in lateral hires among US firms during 2012 was, at least partly, boosted by the firm’s collapse.
The breakdown triggered a hiring frenzy among US firms last year as they fought to pluck the choicest chunks from the dying carcass, with some consequently recording more than twice the number of lateral hires compared with the previous year.
This is something to keep an eye on as the rest of the financial results roll in, but for now let us raise a glass to US firms and ask, “what financial crisis?”