By Lizzy McLellan, The Legal Intelligencer
Recently released data on partner compensation and origination seem to paint a bleak picture for Philadelphia's legal market, but they may just be reflecting a return to normal after a particularly strong rebound from the recession.
According to Major, Lindsey & Africa's Partner Compensation survey, which was fielded in conjunction with ALM Legal Intelligence, Philadelphia was the only major U.S. city where partner compensation and originations declined since 2014, the year of the last survey. Each year's report is based on survey results from the year before, and includes responses from partners at large law firms.
Average total compensation for Philadelphia partners was $625,000 in 2016, down 11 percent from $697,000 in 2014. The only city with lower average compensation was Seattle, at $564,000. But that number showed growth for Seattle, which reported average partner compensation of $438,000 in 2014.
But Meredith Frank, managing director in Major, Lindsey & Africa's partner practice group, said it's not something for Philadelphia lawyers and firms to be concerned about.
"What we saw in 2016 wasn't necessarily what I would characterize as a decline … but more of a return to historical terms for Philadelphia," Frank said.
Frank noted that Philadelphia firms were also especially active in lateral hiring in 2013, and lateral hires often get bumps in pay. That activity could have contributed to the uncharacteristic highs in the 2014 survey.
But Jason Mandel, director of legal recruitment at Alevistar Group, said that may not have a huge impact, depending on the partner. Oftentimes a lateral move can negatively impact an attorney's first financial year at a firm, he said, even if it leads to long-term compensation gains.
Average originations in Philadelphia were also down, according to the 2016 survey, slipping from $2.07 million in 2014 to $1.9 million in 2016, a decline of 8 percent.
Again, Frank said that can be explained by Philadelphia returning to more usual conditions.
"In 2013 we were seeing a really robust turnaround in Philadelphia from the economic downturn," Frank said. But now "things have kind of stabilized."
Read more of this article at The Legal Intelligence.