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Partners suffering most in economic downturn

Partners suffering most in economic downturn

The latest survey from Mahlab Recruitment shows partners in particular are feeling the burden of tougher market conditions in the legal profession.

THE latest survey from Mahlab Recruitment shows partners in particular are feeling the burden of tougher market conditions in the legal profession. 

The survey, 2009 Now and Into The Future, shows partner earnings on average decreased by 5.26 per cent in Sydney and 3.70 per cent in Melbourne, compared to an 11.1 per cent increase last year and 7.1 per cent increase in 2006-2007. 

And it’s not just their pockets that are hurting. During this period there have also been a lower number of partners appointed because of greater financial pressures on legal practices during the global financial crisis. 

“I would be confident is saying there were fewer partners appointed this year and we will be seeing a lot more senior candidates in a holding pattern, up until things improve,” said Lisa Gazis, managing director of Mahlab Recruitment NSW. 

“There have been some firms who have moved more staff across into senior council roles, in part because it suits the lawyer’s aspirations, and in part as a way to give recognition to those lawyers and the seniority that they have, while recognising that they can’t celebrate them into the partnership pool.” 

The report also suggests partners are suffering from higher stress levels than in the past, which Gazis also puts down to the market conditions. 

“A very big thread that came out in the survey was the focus and pressure on partners to do more business development to try and maintain client base-and extract from client base. The requirement to develop business is always there, but in an up market it’s easier.” 

The report, which is supported by the Australian Corporate Lawyers Association (ACLA), Australasian Professional Services Marketing Association (APSMA), Young Lawyers Victoria, Queensland Young Lawyers, Victorian Women Lawyers, Women Law Association NSW and Legal KM, also revealed that partners we being called on to contribute more to the firm as revenue dropped. 

Gazis said: “With the drop in revenue they have been faced with the need to keep the business going and in order to create some buffer, and allow the firm to continue to meet their costs and have more capital to draw on, they have had to turn to partners and ask them to contribute more.”

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Partners suffering most in economic downturn
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