As many law firms contend with overcapacity after stocking up on transactional associates to keep up with last year's unprecedented levels of demand, the Philadelphia law firm community's lower compensation and lesser ability to attract talent may have saved area firms from the same problem.

After trailing national averages in compensation increases and lateral additions for the last year and a half, law firms based in the city are reporting lower productivity and profitability declines than the industry nationwide and tier-one markets like New York, according to the nine-month check-in survey results gathered by Wells Fargo's Legal Specialty Group.