Taking stock – partner hiring is down but acquisitive US firms remain a scourge for UK rivals
"They take our work and our partners and now they want our associates" – is how one senior partner at a leading City firm recently described the continued efforts by US law firms to make their mark in the London legal market
March 27, 2014 at 07:40 AM
3 minute read
"They take our work and our partners and now they want our associates" – is how one senior partner at a leading City firm recently described the continued efforts by US law firms to make their mark in the London legal market.
And of course he is absolutely right. What else would they be doing here? But our latest research may offer a glimmer of hope to those at UK firms sharing similar thoughts: partner-to-partner hiring by US firms in London actually fell last year. Significantly. Our research into the recruitment practices at 44 of the largest international firms in the City found they made just 77 lateral partner hires last year, compared with 127 across the same firms in 2012.
Now it is worth pointing out that 2012 was a pretty exceptional year – Dewey & LeBoeuf's collapse prompted a spree of opportunistic hiring by firms not normally that active in the recruitment market. Meanwhile, Locke Lord brought in 18 partners for a London launch and Dechert's eight-partner haul added more to the firm's City base than the previous three years combined. Neither of these firms made any hires in 2013.
But even without these exceptions, recruitment was still down to its lowest level in years – certainly since the financial crisis. While this could be partly Dewey-related caution, it also reflects the fact that most US firms have now been in the City for so long they don't need to make partner hires on a regular basis – not least because they are growing their own organically.
In fact, given that some 40% of the moves actually came from other US and international firms rather than UK counterparts, the real impact on home-grown operations was distinctly smaller than even the initial headline number suggests.
Not that Clifford Chance or Linklaters are likely to feel quite so detached about last year's raids on their private equity practices. Especially as the former has already suffered another high-profile departure to a US rival in 2014. In these cases it isn't so much about the quantity of the hires, as who they were and the impact their departures will have. Particularly as some client bases – such as private equity – are more transportable than others.
But while big cheques will always win some big names from UK firms, the senior partner quoted above was right to direct his concern at his junior ranks. The maturity of US firms in London means a degree of consolidation at partner level is likely, but the same is not yet true of associates. And here the chequebooks are likely to be even more tempting.
For more, see this week's feature: Taking London – the firms swooping in on the City's top talent.
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