3 Asian Legal Business | September 2024 TheBriefs (Reuters) Large U.S. law firms had strong financial performance in the first half of 2024, with the highest-grossing firms exceeding other segments of the legal market, analysts at Wells Fargo said. Revenue increased an average of 11.4 percent during the first six months of 2024 compared with the same period last year, driven by billing rate and demand growth, according to data from Wells Fargo’s Legal Specialty Group. The group’s survey of more than 130 firms included 66 of the 100 highest-grossing U.S. firms. That’s higher than the 4.4 revenue growth in the first half of 2023, when firms faced continued financial challenges after productivity declines. The new survey data shows the best first half since 2021, Wells Fargo said, as capital markets and M&A activity picked up and work in areas such as litigation, restructuring, antitrust and investment management continued to drive growth. The top 50 highest-grossing U.S. firms had the strongest revenue growth at 13.8 percent in the first half of 2024, according to the survey results. The second 50 firms had 7 percent and the next 100 firms had 8.8 percent revenue growth. The top-grossing U.S. law firm in 2023 was Kirkland & Ellis, with $7.2 billion in revenue. The top 50 firms are “significantly outperforming” the other two segments, mainly due to “a lot more rate growth and a lot better realization,” said Owen Burman, a senior consultant at Wells Fargo’s Legal Specialty Group. Billing rates, demand drive strong US law firm financial performance Your monthly need-to-know Slaughter and May has joined the London law firm salary war, increasing newly qualified (NQ) associate salaries by 20 percent to 150,000 pounds ($196,000), aligning with other Magic Circle firms, according to media reports This move, effective from Sept. 1, was made earlier than planned to keep pace with competitors and retain top talent. The salary race extends beyond the Magic Circle, with firms like Macfarlanes, Herbert Smith Freehills, DLA Piper, and HFW also raising NQ rates. However, U.S. law firms operating in London offer even higher salaries, with Quinn Emanuel and Gibson Dunn leading at 180,000 pounds for NQs. Other U.S. firms, including Paul Weiss, Akin, Fried Frank, Milbank, Sidley Austin, and Goodwin Procter, offer between 175,000 and 180,000 pounds. Firms like Vinson & Elkins, Kirkland & Ellis, Latham & Watkins, and others are close behind, offering 170,000 to 174,000 pounds. This intense competition for top legal talent in London has led to unprecedented salary levels. The sustainability of these high salaries and their impact on the broader legal market and client fees remains to be seen. For now, newly qualified lawyers in London are benefiting from this fierce competition. London salary war escalates as Slaughter and May joins fray
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