City lateral hiring rate returns to pre-crash levels

The number of lateral partner hires in the City is back up to pre-recession levels, according to new research from Motive Legal.

Statistics show that there were 130 partner moves in the first three months of 2012, a level that has not been seen since 2008. It is a 12 per cent increase on the same period last year.

The data, compiled by MotiveLegal and released as The London Lateral Hiring Trends Bulletin, is likely to be skewed during the next quarter because of the feeding frenzy around the carcass of Dewey & LeBoeuf (4 May 2012).

But the latest figures show that UK firms continue to dominate the London hiring market, with moves between two UK firms accounting for 40 per cent of total hires.

US firms made 23 per cent of total hires, with a net gain between them of 14 partners from 1 January to the end of March.

The research also shows that team moves remain popular – 16 per cent of partner hires were as part of two or more colleagues making the same leap. This is seen as a favourable move in the sense that it should encourage big clients to move with their lawyers and it is at its highest level for five years. This figure will be boosted further in the next quarter by entire practices jumping ship from Dewey.

The finance sector accounted for nearly a fifth of all hires, litigation (17 per cent) was next, with a recovery for real estate movement (15 per cent) in third. Corporate slumped to a below-average 11 per cent of all lateral partner hires.

The report also looks at where partners are moving to and from.

Mayer Brown is top of the table for Q1 partner losses, with nine, and has recently announced redundancy plans at its London office (4 May 2012). It is closely followed by DLA Piper and Nabarro, with five apiece.

Berwin Leighton Paisner heads the Q1 hiring list, with five new recruits as it continues its policy of recruiting form the magic circle, followed by Eversheds, Gowlings and Squire Sanders on four each.

Canadian firm Gowlings took a team from Manchester-based Cobbetts and Squire Sanders added a maritime practice made-up of DLA Piper and Thomas Cooper partners.

The report says that less profitable firms appearing at the top of the hiring charts could reflect bigger patterns.

It said just 10 per cent of finance partners moved up the food chain to firms with higher profits, whereas half of the corporate partners went to more profitable firms.

The trends bulletin speculated: “This could indicate that firms are shedding unprofitable finance partners who are moving to firms lower down the food chain, whereas more profitable firms are starting to cherry-pick the best corporate partners from smaller or less profitable firms.”

Total hires in Q1
2007 – 124
2008 – 130
2009 – 65
2010 – 120
2011 – 117
2012 – 130

Top hirers in Q1, 2012,
BLP – 5
Eversheds – 4
Gowlings – 4
Squire Sanders – 4
EMW Law – 3
Fladgate – 3
LG – 3
Orrick – 3
Reed Smith – 3
Ropes & Gray – 3

Partners lost to another firm in Q1, 2012 (Q1 net gain/loss)
Mayer Brown – 9 (-7)
Stephenson Harwood – 4 (-2)
DLA Piper – 5 (-4)
Nabarro – 5 (-5)
Cobbetts – 4 (-4)
BLP – 3 (+2)
Hogan Lovells – 3 (-2)
Norton Rose – 3 (-2)
SNR Denton – 3 (-2)