Things seem to have slowed down now, but what does the future hold for associates and staff when it comes to layoffs?
Law.com recently polled associates, partners, and staff on the matter, and it looks like they’re still a little cagey when it comes to job cuts — the prospect of layoffs is still top of mind, and they’re expecting more to happen before the end of the year.
The majority of Law.com’s poll respondents hailed from the biggest of Biglaw firms (63.8%), and when asked if their firms had already conducted layoffs this year, 17% said yes, while 76.6% said no (another 6.4% said they were unsure). But what was to blame for the layoffs at firms that did part ways with attorneys and staff? Here are the details, from Law.com:
Of those who answered “yes,” 40% said the reason given for the layoffs was that their firms had overhired during the pandemic and were now over capacity as demand slowed.
But in open-ended responses, several respondents were skeptical of that notion.
“Firm is saying we have too much headcount, but we all know this is to ensure partner comp remains unaffected,” one respondent said.
Unfortunately, it looks like lawyers and staff members simply aren’t buying the overcapacity song and dance that many firms soft-shoed to this summer while slashing jobs. With that in mind, Law.com’s poll respondents believe more layoffs are headed our way in 2023.
There was strong sentiment among respondents that layoffs among law firms are not done yet this year, with 76.6% saying they anticipate more cuts in 2023, mostly due to economic factors such as high interest rates tamping down demand.
Noting what happened with the tech industry, one Law.com respondent said, “[I]f every firm wants to maintain the profitability or their ranking, the whole industry will need to make layoffs when faced with a slower economy and less transactions.”
If more layoffs are, in fact, coming down the line, let us be the first to say that it’s probably not you — it’s them. We sincerely hope it doesn’t happen, but in case it does, best of luck to those who may be let go from their jobs.
If your firm or organization is reducing the ranks of its lawyers or staff, whether through deferrals, open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477). Thank you for your assistance.
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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter and Threads or connect with her on LinkedIn.