NALP, Perspectives on 2017 Law Student Recruiting:
Following the near collapse of entry-level recruiting by large law firms in 2009, most law firms have rebuilt their summer programs and in many ways, Big Law recruiting volume and practices resemble those measured before the recession. On the other hand, for the second year in a row aggregate summer offer volume decreased compared with the year before, and a significant percentage of law firms said they made fewer offers for 2018 summer programs than for 2017 summer programs. Also, the average summer program class size at the largest law firms dipped in 2017. The data collected from NALP’s surveys of law schools and law firms at the end of the 2017 recruiting cycle present something of a nuanced picture, suggesting not so much a contraction as a leveling of recruiting volumes following years of growth.
Another characteristic of the most recent recruiting cycle and one that is consistent with patterns measured in the last several years is that the level of recruitment has not been consistent across law firms. Some firms are reporting increased recruiting activity and larger classes even as other firms are reporting scaling back recruiting activity and smaller summer classes. This is consistent with the dispersion and market segmentation in law firm performance generally that has been described by industry observers.
For instance, while about 29 percent of law firms reported visiting more campuses in 2017 compared to 2016, 34 percent reported visiting fewer, and 37 percent reported visiting the same number of schools compared to the previous year. We also saw variations by city, with the median number of schools visited by offices New York, Boston, and Silicon Valley offices decreasing compared with 2016. This is notable in that New York and Silicon Valley law firm offices led the recovery following the recession.
Similarly, while 45 percent of law firms reported making more offers for summer programs in 2017 compared with 2016, 43 percent reported making fewer offers, and ten percent reported making more than ten fewer offers than the year before. This follows survey data from last year that showed 50 percent of firms making fewer offers in 2016 compared with 2015, and thus marks two years in a row with significant numbers of firms reporting that they made fewer offers and follows several years during which a majority of firms reported making more offers year over year. Also of note, the aggregate number of offers made by offices in the New York was down, and nearly flat in the Silicon Valley.
The percentage of callback interviews that resulted in offers for summer programs remained essentially flat (between 52 percent and 54 percent) for the fourth year in a row after having grown from 2012 through 2014, and the yield on those offers also remained essentially flat (between 33 percent and 34 percent) for the last four years. Also, the extent to which firms recruited 3Ls was also flat after having fallen by five full percentage points between 2015 and 2016. The percent of law firms recruiting 3Ls fell precipitously from 2006 to 2009, from 59 percent to just 3 percent, and has since bobbled around in the 15-20 percent range, with figures of 18 percent measured in each of the last two recruiting cycles.
The average summer program class size was also flat, at 14 for the second year in a row, and has varied only between 12 and 14 for the last four years. Summer program class sizes, of course, vary a great deal, but the average is helpful in gauging national change. The most common summer class size was just 2, followed by classes of 3, but 17 percent of summer classes were larger than 20 and 7 percent were larger than 50. The average summer class size for the largest firms of more than 700 lawyers actually fell by 2 from 22 in the summer of 2016 to 20 during the summer of 2017. The aggregate offer rate coming out of summer programs has also been flat, at just about 95 percent for the last three years, but aggregate offer rates varied considerably by region and city, approaching 100 percent in the Northeast and more than 20 percentage points lower than that in the Southeast. Similarly, for law offices in New York City the aggregate offer rate exceeded 99 percent, while for offices in Washington, DC, it was below 85 percent. The acceptance rate on offers as a whole has hovered between 84 percent and 86 percent for seven years in a row now, essentially flat and significantly higher than the pre-recession norm of overall acceptance rates in the mid-seventies.
Members of the Class of 2019, those who went through the OCI process in the summer and fall of 2017, experienced a robust market quite similar to that experienced by the previous two classes, and with significant competition for top talent. Across employers of all sizes, the median number of offers extended has been at or about 12 for the last three years, still well-below the high of 15 measured in 2007, but well above the low of 7 measured in 2009. Similarly, the mean number of offers was completely flat at 38 for the past three years, having jumped up from 35 in 2014, 27 in 2013, and only 20 in 2012, and close to the figure of 39 measured in 2007. The percent of callback interviews resulting in offers for summer positions has been in the 52 percent to 54 percent range for the past four years, and though the percentage fell slightly from 53.3 percent down to 51.9 percent, it is still well below the figures of 62.7 percent and 60 percent measured in 2006 and 2007, and well above the low figure of 36.4 percent measured in 2009.
“The measures that describe law firm recruiting activity tend to describe a series of peaks and valleys, with rare periods of stability or flatness. In 2017, after a period of considerable volatility marked first by a prolonged slowdown in law student recruiting volumes following the recession and then a rapid escalation in recruiting volumes for two years running, we have seen the recruiting market stabilize over the last two years,” says James Leipold, NALP’s Executive Director. “Recruiting numbers were mostly flat compared to last year, and in some cases we saw some pulling back, particularly at the largest firms, suggesting that the most recent period of growth has ended. The picture is most accurately described as flat in 2017, though there are differences by market. In New York in particular, the competition for top talent remains fierce, but there and in Silicon Valley firms reported visiting fewer law schools. As with law firm profitability, there remain large differences between individual firms in terms of the number of offers being extended for summer programs and the size of the summer programs themselves. Economic predictions suggest that law firms will continue to face modest revenue growth, with wide dispersion and segmentation in the market. Law schools, for their part, having endured a period of dramatic decline in enrollment, now face several years of stable enrollment, at least through the Class of 2020. Absent a dramatic economic interruption of some sort, the picture for law firm recruiting is not likely to change dramatically in the short term.”