Linklaters has the highest average costs per employee across the top 30 UK law firms, paying out almost £20,000 more on staff than the next highest firm, Freshfields Bruckhaus Deringer.

The 4,346 members of staff at Linklaters were paid an average of £137,410 over the 2013-14 financial year, according to the firm's accounts, amounting to a total staff cost of £597.2m. This compares to an average cost per employee of £118,520 at Freshfields, which, despite employing 275 more staff, had a lower staff costs bill of £547.7m.

Analysis of firms' limited liability partnership (LLP) accounts for 2013-14 shows that Clifford Chance (CC) and Allen & Overy (A&O) are the next most generous employers with Berwin Leighton Paisner completing the top five, replacing last year's fifth-placed firm, Simmons & Simmons.

The analysis, which excludes Slaughter and May as it is not an LLP, shows total staff costs across the group have grown by 5% year-on-year to stand at £4.9bn for 2013-14, with the group's LLPs employing a total of 59,795 staff, almost 1,000 more than the previous year. The group spent on average 39.7% of its total £11.7bn revenue on its employees.

Paul Heugh, chief executive of Skarbek Associates, a strategy implementation group that advises the legal sector, put the increase in headcount and staff costs down to a variety of factors, including the economic recovery, an increasing requirement for support staff as firms try to coordinate their activities over ever-wider geographies and the popularity of taking on paralegals for transactional work.

"Any good business person knows that during a period of growth you have to have the resources to service the opportunities that are there," says Heugh. "But you don't want to grow fat; firms need to stay lean otherwise in the down times they'll have to shed staff, which is horrid for morale."

Headcount in flux
DWF saw the greatest rise in both support staff and total staff numbers, which surged 31% and 37% respectively between the 2012-13 and 2013-14 financial years.

The rapid expansion in headcount at the firm comes as the 2013-14 accounts reflect four successive mergers and the acquisition of Cobbetts. "Through strategic investment in people, both through our M&A activity and subsequent lateral team and partner hires, we've significantly strengthened our corporate and banking, insurance, litigation and real estate offerings," explains the firm's managing partner and chief executive, Andrew Leaitherland.

He adds that efforts to expand the firm's City presence have built a "strong platform for future UK and international growth".

Unsurprisingly, DWF also saw the greatest increase in staff costs. The firm spent a total of £63.4m on staff in the 2012-13 financial year, rising to £85.9m for 2013-14, a jump of 35%. However, the average cost per employee is one of the lowest in the top 30, at £40,800.

Watson Farley & Williams and DAC Beachcroft were the only firms apart from DWF to see a double-digit percentage increase in total staff numbers, with Watson Farley reporting the largest percentage increase in fee-earner numbers of the top 30. Watson Farley added an extra 80 fee earners over the financial year, growing its total from 175 to 255. However, the firm remained the smallest overall among the group with just 375 total staff in 2013-14, 90 fewer than the next smallest firm in the top 30, Macfarlanes.

In contrast, A&O, legacy Wragge & Co and CMS Cameron McKenna all saw sizable decreases in total staff numbers. CMS UK cut staff numbers by 8%, while overall staff costs fell by 21% to £57.1m. However, the firm restructured its business and partner model in the early part of the 2013 calendar year, bringing more partners into the equity and changing how costs are reported, so the figures are not comparable. Following the restructuring it has the second lowest staff costs as a percentage of revenue of the group (28%).

At legacy Wragges there was an 11% drop in staff numbers, including 16% fewer support staff than in 2012-13. The firm's merger with legacy Lawrence Graham went live on 1 May 2014.

A&O was the only magic circle firm to cut its overall staff numbers in 2013-14 (although CC did cut lawyer numbers marginally), saving itself £15m by cutting 4% of people. Although not part of the analysis, Slaughters did confirm that it had 660 fee earners and 456 support staff in London in the last financial year, compared to 624 fee earners and 464 support staff for the previous year.

Across the top 30, total fee-earner numbers went from 31,202 to 32,139, an increase of 5%, while support staff numbers went from 26,989 to 27,026, staying broadly static.

"There have been some interesting staff dynamics over the last few years, one of which has been the increasing use of paralegals, meaning some people can have a lot more of them than lawyers," says Heugh. "In some instances that has allowed firms to increase headcount while reducing their wage bill.

"On the other hand there has been quite a lot of cross movement between firms – that's always existed but the amount seems to have increased over the last few years – allowing people to get senior expertise quicker."

Adding up the costs
Although the magic circle has both the highest total staff costs and staff numbers, other firms feature more prominently when ranked by costs as a proportion of revenue. DAC spends more than half (55%) of its revenue on staff costs, with a bill of £109.2m against revenue of £197.2m. The firm grew both its fee earner and support staff headcount by 11%, leading overall costs to rise by 10%. Senior partner Simon Hodson said: "Different law firms operate different business models, sometimes to reflect different business activities. Even using statutory accounts no two sets of statistics will be fully comparable."

At the other end of the scale, Macfarlanes spent the least money on staff as a proportion of revenue, at just 27%. The firm has the third lowest total costs in the group at £37.1m and the second fewest members of staff, with 465. Other firms spending proportionally little include CMS UK and Irwin Mitchell, both of which also have among the lowest average costs per employee in the group.

Watson Farley has the fewest support staff per fee earner, with 2.13 fee earners to every member of support staff. On average the top 30 have 1.29 fee earners to every member of support staff with just a handful – Norton Rose Fulbright, Ashurst, Simmons & Simmons, A&O, Withers and DLA Piper – having more support staff than fee earners within their LLPs.

Twenty of the firms have grown their fee-earner numbers over the period, while just 11 have increased the number of support staff they employ.

• Click here to view key figures from the LLP accounts