ALM’s Survey of Law Firm Economics Shows Revenues on Upswing
Average compensation for lawyers in U.S. grew to $296,000 in 2012, gains largest in law firms with 150+ lawyers
NEW YORK – July 29, 2013 – ALM Legal Intelligence today published its annual Survey of Law Firm Economics, which found that average revenues at U.S. law firms rebounded last year with a modest 1.15 percent increase nationwide.
In 2012, law firm revenue per lawyer (RPL) inched up to $437,000, a slight increase from RPL of $432,000 in 2011, but still well below the record RPL of $451,000 recorded back in 2010.
The survey results were reported in today’s issue of The National Law Journal, which is accessible at www.nlj.com. The survey was conducted by ALM Legal Intelligence, in association with The National Law Journal, and is available online now at http://almlegalintel.com/Surveys/SLFE.
“This year’s survey benchmarks two diverging trends we’ve seen for a while now involving the law firms on opposite ends of the spectrum in the U.S.,” said Kevin Iredell, vice president of ALM Legal Intelligence. “The largest firms grew significantly last year, with a strong 9 percent increase in RPL for the firms with 150 lawyers or more. Meanwhile, the smallest firms continued to face revenue challenges, with a sharp 8 percent decline in RPL for the firms with fewer than 10 lawyers.”
The survey found that average compensation for individual lawyers in the U.S. grew from $292,000 in 2011 to $296,000 in 2012, a 1.5 percent increase in pay.
Other noteworthy findings of the survey included the following:
- Mergers are back on the table – more firms are either actively seeking or open to merger discussions than the previous year (47 percent in 2013 vs. 42 percent in the 2012 survey);
- Cautious optimism for growth – optimism for profits per partner is growing, with 21 percent of firms expecting their profits per partner to grow by more than 5 percent in 2013, vs. 17 percent one year ago;
- Alternative fee arrangements (AFAs) not taking off – for the vast majority of U.S. law firms, AFAs still represent a small percentage of billings, which has not changed significantly in each of the past four years; and
- Deleveraging continues — the associate to partner ratio fell again last year, from .54 in 2011 to .49 last year.
First published in 1972, the Survey of Law Firm Economics is one of the most complete, accurate and up-to-date set of economic statistics and financial data available about the legal profession. This year’s survey contains information about nearly 10,000 lawyers from 159 U.S. law firms. Data is presented nationally and by firm size, geographic location, practice area specialty, population area size, gender, year admitted to the bar, and years of experience.
About ALM Legal Intelligence
ALM Legal Intelligence offers detailed business information for and about the legal industry, focused on the top U.S. and international law firms. The division’s online research Web service, www.almlegalintelligence.com, provides subscribers with direct, on-demand access to ALM Legal Intelligence’s extensive database of surveys, rankings and lists related to law firms and the legal industry. ALM Legal Intelligence is a division of ALM.
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