US firms are worse than UK firms at holding on to lateral partner hires but in-house lawyers that move to private practice partnership fare the worst, with 43 per cent leaving their new firm within seven years.
In its third year conducting research in the area, Motive Legal Consulting analysed 2,763 partner hires in London between 2005 and 2012 looking at drop-out rates. Overall 32 per cent of lateral partner hires failed – meaning they left or were kicked out of their new firm – within seven years. Meanwhile, 61 per cent of partners that joined firms in 2007 are no longer at that place of business.
The research showed that US firms were worse than their UK counterparts at retaining talent in London with a 40 per cent failure rate. Transatlantic firms, that is merged UK/US firms, fared the best with just a 25 per cent drop out rate.
Those moving from in-house jobs to private practice partnership were most likely to fail, however. Here, 43 per cent of lateral hires failed within seven years, with that figure rising to 55 per cent when the hiring firm was American.
US firms are advised to hire from either other US firms in London, or from transatlantic firms if they want the hire to stick.
In terms of practice areas, real estate has taken a battering unlike any other. Eighty per cent of real estate partners that moved firms in 2005 have since moved again. Even 20 per cent of those that joined their new firm in 2010 have since left.
For more on trends in lateral partner hires, see the feature in The Lawyer here.