Law Firm Partner Compensation Increases by 26% Since 2022, Nearly Doubles Over the Past Decade

Hanover, MD – October 24, 2024 – As billing rates surge and top law firms report record profits, average partner compensation has increased by a staggering 26% over the past two years, to $1.4 million, according to the 2024 Partner Compensation Survey released today by Major, Lindsey & Africa (MLA), the world’s largest legal search firm. This amount is the highest-ever average total compensation figure and the highest percentage increase in the survey's history. MLA’s Survey was conducted between June and August 2024 in conjunction with Western Management Group and is based on responses from over 1,700 respondents across the United States.

"The record increase in compensation in this year’s survey was driven in large part by a 26% increase in average partner originations and, to a lesser extent, a 36% increase in billing rates – the two variables that by far have the  most impact on compensation,” said Karen Andersen, a Partner in MLA’s Partner Practice Group and a co-author of the survey. “Law firm partners are continuing to reap the rewards of persistent high demand and increases in billing rates. Moving into 2025, especially with the Federal Reserve cutting interest rates, we expect these trends to continue.”

As more firms add non-equity partnership tiers, the pay disparity between equity and non-equity partners remains substantial. Equity partners took home average earnings of $1.9 million compared to $558,000 for non-equity partners.  While both groups experienced substantial compensation increases in 2023, equity partners’ pay increase (32%) outpaced that of non-equity partners (21%). Equity partners’ average compensation has also climbed more substantially over time, doubling since 2014, compared to non-equity partner compensation, which increased by 65% in that same time frame.

“This gap is primarily driven by revenue origination and billing rates: Equity partners consistently outperform non-equity partners in both these metrics, which directly translates to their substantially higher compensation,” added Louis Ramos, Managing Director in the Partner Practice Group at MLA, and co-author of the survey.

The gender pay gap among law firm partners also remains sizable, though it has consistently narrowed over time. In the 2024 Survey, average compensation for male partners was 29% higher than that of female partners, with male partners’ compensation reaching an average of $1.7 million compared to $1.2 million for female partners. The majority of this variation in compensation can explained by differences in average originations by gender, where male partners also continue to significantly outpace female partners (reporting average originations of $3.9 million compared $2.4 million for female partners). Notably, however, male and female partner compensation increased at the same rate since 2022, both up by 37% over the past two years.

“While it’s encouraging to see the gender pay gap narrow yet again, male partners are still outearning their female colleagues by 29%,” said Kirsten K. Vasquez, Vice President, Law Firm Recruiting at MLA. “Originations naturally play a big role in this disparity: Originations from men remain 60% higher than those from women.  Firms should continue to evaluate their compensation systems and business development policies with a critical lens to how existing models could contribute to gender pay imbalances.”

Other notable findings of the survey include:

• Corporate partners again take home the highest compensation: Corporate partners reported the highest average total compensation, of $1.9 million, an increase of 29% since 2022. Tax & ERISA partners and employment/labor partners, meanwhile, saw the largest percentage growth in compensation, up by 42% and 45%, respectively.
• Individual lawyer workload has stayed consistent: While the average billing rate for partners has skyrocketed by 83% in the past 10 years, average billable hours this year (1,721) were only 2% higher than the average reported in 2014.
• Partners in New York have the highest total average compensation, at $2.3 million. Meanwhile, partners in Silicon Valley, Seattle, and Philadelphia saw the largest percentage increases in compensation, up by 49%, 41%, and 35%, respectively, since 2022.
• Partner satisfaction with their compensation was strong, with 72% of respondents reporting some degree of satisfaction with their 2023 pay. Satisfaction was particularly high among equity partners, with 80% indicating some level of satisfaction, compared to 60% of non-equity partners.

The 2024 Partner Compensation Survey can be accessed here.