Magic circle trainees kept on despite recession

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  • Why bother?

    I'm amazed that retention rates for spring qualifiers are so high. It's pretty cheap to get rid of NQs as once a TC is finished then firms have no obligation to keep the trainee on. All these firms will end up doing is sacking them later in the year and that will cost them in redundancy packages.

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  • Alternative viewpoint

    Yes, but retention rates are looked at a lot by future potential trainees and it would seem foolishly short-sighted of the firms to save costs in the next few months at the risk of losing talent in the future, particularly given that they are already recruiting for 2011 and beyond when, presumably, things will be on the up again.

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  • Amazed

    If firms are shedding large numbers of partners and associates, it has to make sense to reduce the number of training contracts and retention rates. If it's not worth keeping experienced people for the longer term, it cannot be worth keeping completely inexperienced people for the longer term. And in terms of the bad publicity that might be created by such a course of action, I think students are intelligent enough to look beyond the trainee situation to the wider situation at firms. I would fully expect trainees and potential trainees to look at partner and associate redundancies in a similar light to reductions in trainee intakes and/or retention rates.

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  • Yes but...

    Trainees will be looking at longer term job prospects as well. It will be interesting to see what impact this current round of cuts will have on the trainee decisions. Do they want somewhere where job security is perceived to be an issue long term? If they can get on board with the concept that law firms may have to cut jobs in a recession then i don't see why they won't be able to apply the same logic to trainee retention in the same circumstances. If they can't get on board with that, then they won't be considering the firm and so trainee retention rates won't matter.

    Anyway, regardless of future trainee perception (important, but doubt it's the dominant factor when pep is on the line), trainees are being kept on because we always need bodies at the bottom of the pyramid when the market picks up. To do otherwise would mean there would be nowhere near enough juniors just at the time when you need them. Steady investment in juniors through good and bad times is the best strategy for ensuring you are well placed to take advantage of the uptick. If the uptick doesn't come then you undoubtedly need to "make some difficult decisions" before they adversely affect the shape of the firm, but it would be folly to stop investing at the bottom. I kind of wish the pyramid structure didn't dictate so much of what happens in law firms (so that those already in the firm could be kept on rather than being made redundant whilst we continue to recruit at the bottom), but i'm not aware of any other models being successful.

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  • Magic circle trainees

    The basic fact is that trainees are cheap laboutr and newly qualified solicitors are cheap labour. The market is saturated, employers know they can get away with paying as little as possible because most trainees/NQ's are just thank ful to have a job. In this market employers are more concerned with price as opposed to quality/experience.

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  • Trainee decisions?

    The previous poster mentioned that "it will be interesting to see what impact the current round of job cuts will have on the trainee decisions." In the current market, existing trainees have little scope for decisions. Whilst job cuts may affect perceptions for prospective trainee candidates, the NQ job market is dire, even non-existent. March qualifier retention rates at Magic Circle firms may be fairly high, but I understand the Simmons figure is actually below 66% and at a major US firm in London they are at 66%; it's even worse elsewhere.

    This, quite apart from appearing short sighted, has created a surplus of supply of NQs and zero demand. I am as yet unaware of any genuine NQ opportunities at mid- to top-tier City firms, even in fields such as litigation and insolvency that - being classically counter-cyclical - ought to be growth areas at present. Opportunities in these areas appear to be solely at 2+PQE. There are some NQ opportunities in the regions, but I have heard that even Magic Circle NQs haven't reached the interview stage. Recruiters and partners alike are commenting that they have never seen an NQ market like this. Which begs the question, what are those NQ who are not kept on supposed to do?

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  • Depends on the trainees too

    It's all very well looking at it from the firm's point of view but a large reason why retention rates are holding up so well will be the trainees reluctance to look elsewhere.

    When times are good a trainee may think the grass is greener elsewhere, but at the moment if they are offered a job, (even if it is far from their first choice specialism), they will snatch the firm's hand off.

    A good retention rate doesn't mean that firms are looking to the future or investing in their trainees, just that trainees are too scared to look elsewhere.

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  • What about us?

    It is fair enough to say that it is better to rid of trainees once their contracts are up as said by the above person, however what then happens to qualifiers like myself who have slogged away through the contract after going through the difficult process of securing one in the first place?!

    Yes we would grab any opportunity at our training firm - and why ever not in this current climate?! Unless more firms open up their gates to NQs from outside, what other choice do we have? If we are not retained or given a chance by another firm, then all our hard work and expense has been done in vain.

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