Retention remains flat at 76% with Skadden, Paul Hastings and Sidley the only firms to keep all trainees

The intake of newly qualified lawyers (NQs) at the largest US and international firms in the UK fell by 6% in the last year, highlighting the continued uncertainty for lawyers at the junior end of the profession.

Just a handful of firms in the group of 21 surveyed by Legal Week posted year-on-year increases in the number of NQs who were offered and accepted a training contract. These included Mayer Brown, Shearman & Sterling, McDermott Will & Emery and Sidley Austin. Sidley Austin, alongside Paul Hastings and Skadden Arps Slate Meagher & Flom were the only firms to retain 100% of their intake. 

The research also highlighted the sizeable impact US and international firms have had on the graduate recruitment market, with Reed Smith, Dentons and Baker & McKenzie each taking on at least 25 NQs in 2013. 

Mayer Brown took on 20 NQs in London, up from 16 the previous year, while its retention rate grew from 64% to 71%. Two of these recruits joined on one-year fixed-term contracts.

But average retention rates – defined as the proportion of trainees who were offered and accepted a contract – remained static at 76% across all firms surveyed. In 2011 it was 79%.

Orrick Herrington & Sutcliffe and Edwards Wildman Palmer – which each had two NQs join this year – posted the lowest retention rates of the group, at 25% (two out of eight) and 29% (two out of seven) respectively. 

The overall figures broadly reflect the picture at the top 20 UK firms, which this autumn saw a drop of 6% in the number of NQs accepting roles.

Several partners suggested the drop in retention rates and the number of NQs joining firms in London was a delayed effect of the recession.

"There has been a big rush into the UK market by several US firms, many of which came in without a clear strategy, and have found it a struggle," commented Shearman & Sterling EMEA managing partner Nick Buckworth. "Because of the importance the legal profession places on profitability, firms that have struggled will identify trainee programmes as one of the first things to cut."

Reed Smith graduate recruitment manager Lucy Crittenden (pictured) added: "When law firms do their recruitment, they don't necessarily know what the market is going to be like further down the line. It can be four years or more before students become NQs with a firm. It's crucial to have a bedrock of home-grown talent that knows the culture, clients and processes of the firm – they are the best people to help you build. There's a cost involved, but firms will ideally want to bring on all trainees, as it's a huge investment. It is really important that firms look to grow their own talent, regardless of their size."