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The Running of a successful graduate training programme begins by hiring the very best people. Effective recruitment goes hand-in-hand with effective training; if an organisation can attract the top talent, its training schemes will be better received, understood and then put into practice. Given that it costs around £150,000 to train one lawyer at a top City firm, the importance of attracting the most suitable recipients cannot be underestimated.
But more than ever law firms are not only engaging in talent wars with other firms, they must also battle with other City-focused professions. The scale of that fight was highlighted by this year's survey by the Association of Graduate Recruiters (AGR).
The summer review of the AGR's Graduate Recruitment Survey 2005 quizzed 224 blue-chip employers with large graduate recruitment schemes. A good cross-section of more than 20 law firms took part, ranging from magic circle outfits Freshfields Bruckhaus Deringer and Linklaters to large City firms Herbert Smith and Lovells, through to regionals such as and Wragge & Co.
The research shows that investment banks and fund managers have 16.7 per cent more graduate vacancies than last year, while consulting and accountancy businesses increased by 20.4 per cent. The trend, which the AGR attributes to recovery from 9/11 and growing business confidence, spells bad news for law firms. The already stretched pool of talent will be plundered further by these sectors, which are already among the most prolific recruiters. While law firms recorded no change, the number of vacancies across all AGR members increased by 11.3 per cent in 2005 compared with last year.
The survey found that the legal profession more than holds its own in the area of salaries, but revealed there had been no change in the average graduate salary of £28,000. This is despite the overall average salary rising by 4.8 per cent, and 10 per cent within the accountancy and professional services sector.
Legal trainees are still among the best paid but are beaten by investment banking trainees, who receive an average of £35,000, and those at consulting firms, with take-home salaries of £28,500. The good news for law firms is that, in both these sectors, pay rates have recorded no change.
Out of the AGR employers in 2005, accountancy and professional services firms took 24.3 per cent of the total vacancies, with investment banks and fund managers taking 11.7 per cent. Law firms, meanwhile, took an 8 per cent share.
Kerry Jarred is the graduate recruitment manager at Herbert Smith and a board member of the AGR. "It's definitely becoming more competitive," she says. "The graduate recruitment market is quite buoyant and the investment banks and big professional services firms have increased their vacancies, but the pool of top talent remains the same."
The trick, she says, is to be a bit smarter with recruitment. Her firm has launched a scheme aimed at delivering the lowdown on the legal profession and Herbert Smith in an innovative way. Under the 'Campus Manager Programme', the firm plans to recruit second-year law students to act as its representatives in university campuses. The idea is that they will find out students' needs and be able to answer basic questions about the legal profession and Herbert Smith. Following an initial pilot in five universities, from October the scheme will be run in 18 institutions, including five not traditionally targeted by big City firms.
Jarred says the scheme will allow Herbert Smith to be more "targeted and tailored" with its recruitment and marketing. Not only will it help the students who become managers, but Jarred hopes that having students spread the word on a one-to-one basis to their peers will also give Herbert Smith the edge over other professions and other law firms.
The training contract structure used by law firms can also act as a pull for those deciding their career paths. Linklaters graduate recruitment partner Olivia McKendrick says that, increasingly, the issue of training is one of the considerations for applicants.
"It's a recurring theme raised by students," says McKendrick. "The vast majority of them will mention training quality and like the continuous learning that's offered."
"I think the structured training that the training contract provides, particularly with the large firms, is something which does attract people, both in terms of the experience they get in different practice areas and the fact that they become part of a profession at the end," says Clifford Chance graduate recruitment partner Julia Clarke. Unlike some other graduate schemes, trainee lawyers are not under pressure to specialise too quickly, she adds.
McKendrick says that, ultimately, students must make up their own minds on which routes to pursue, but she does tell prospective applicants that the solicitor profession offers flexibility.
"What I say is that you could go into investment banking, or you could go into something that gives you a range of options instead. Training as a lawyer can be a pretty good door into other things. If you want to go and work at Goldman Sachs after all, you can - but it's harder to do it the other way," she maintains.
Ruth Edwards, the graduate recruitment manager at Norton Rose, says the quality of training offered by firms is increasingly being considered and graduates are now looking at the "bigger picture".
"I think candidates have become more aware of what's available. They're actually quite savvy; they're thinking about the type of training a firm can offer beyond the training contract stage," she explains.
But Ashurst graduate recruitment partner David Carter argues that the talent pool is big enough to go around among the various City-focused professions. He says he is still seeing many talented applicants and has yet to see a drop in standards, an assertion made by all of the firms.
"It's all good that the brightest people are entering into the City. It improves the services that we as a city can offer clients," adds Carter.
The challenge going forward for the legal profession is to find ways to make sure it continues to draw in the cream of the crop.