Academic

Further Thoughts On Law Firm Layoffs: Stigma Is Gone, More To Come

By Dan Filler

In the aftermath of Black Thursday, commentators are pondering the meaning of yesterday's big firm layoff frenzy.  Over at American Lawyer, Aric Press has this to say:

Law firms are actively considering the prospect of pay cuts, delayed starting dates, sharply reduced offers, and more lay-offs. The carnage of Black Thursday will likely continue. This is an ugly situation made worse by the peculiar hiring schemes that were tolerable during good times but now are under serious stress. Not every firm has swung the scythe and some never will. It?s notable though that with so many firms pushing out so many people, there is little of the usual talk about how firms are endangering their cultures. For the moment they are more concerned about managing their businesses.

The WSJ Law Blog adds:

The period between January and April is typically a fallow one for law firms. The year-end collection season has come and gone and firms have to ready themselves for a big tax bill come April 15. So it?s a reasonable time to cut overhead. But the jury still seems to be out on why there was so much cutting done yesterday. One hypothesis, from Jerry Kowalski, a legal consultant: Jump in when everyone else is doing it. ?In past years, law firms lost a lot of their reputation when they announced layoffs. Now, because all of the expectations for 2009 are so bad, it?s no big deal,? he said. ?You want to get buried in the tsunami of layoffs.?

Hmm...that sounds familiar!   

The Recorder adds this:

"There will be more," said consultant Peter Zeughauser. "Materially more. I'm aware of some big ones coming up."

I haven't spent the time aggregate all the local links, but naturally the press in many of the affected cities is reporting on this news.  Some examples: the Chicago Tribune covers DLA Piper; the Minneapolis Star-Tribune covers Faegre (and 7 local layoffs at IP shop Merchant & Gould); and the St. Petersburg Times covers Holland & Knight.  It doesn't look like some of the other big city papers have started covering the issue, but I'd look for Philadelphia Inquirer, Boston Globe, and NY Times coverage soon enough.  

Full post as published by The Faculty Lounge on February 13, 2009 (boomark / email).