The divide between qualifying and making partner has continued to grow. On average, partner numbers at the top firms grew by 4.7%, compared with an 11% increase in leverage to 7:1.
The change means a greater proportion of assistants are entering the top firms than are making partner at the top end — a trend that is likely to fuel associate concerns over long working hours combined with decreasing chances of making partner.
Some of the
Travers Smith managing partner Chris Carroll commented: “It is doubtful whether the model favoured by many firms of as few equity partners as possible earning as much as possible by driving as many assistants as possible as hard as possible is sustainable in the long run. The assistants are showing what they think of that model by voting with their feet.’’
SJ Berwin managing partner Ralph Cohen said: “You get to a certain level — say the £500,000 partner profits point — and then squeezing more out of the machine becomes increasingly difficult; particularly if you are not going for the big de-equitisation push. You cannot ask associates to do much more than they are doing.”
National firms have the highest leverage, while City firms including Linklaters, Allen & Overy, Lovells and Berwin Leighton Paisner have increased their leverage in the last year.
The number of lawyers at all of the top 50 firms grew by around 10% over the year, with total fee earners now standing at slightly more than 40,000 compared with around 37,000 in 2006.
The number of equity partners across the top 50 rose by 1% during the financial year, but the percentage of equity partners as a proportion of overall partner numbers fell by 1.6%. Around two-thirds (63.1%) of partners at top 50 firms have equity status.
CMS Cameron McKenna managing partner Dick Tyler said the leverage rise was not all due to growth at the junior end of the profession, as firms such as Freshfields Bruckhaus Deringer have made de-equitisations.
“Changes in leverage are not due so much to rises in the numbers of associates but more to falling numbers of equity partners. You can only fiddle so much with leverage before you lose quality control.”
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