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Law firm hiring committees are like restaurateurs. Neither party brings hard science to expensive decisions: how many first-year associates to hire, how much meat to hang in the locker for carnivorous customers. “Every day, a restaurant has to make an estimate on how many people are going to order steak, how many want chicken, how many want the veal Milanese,” said Robert J. Kafin, chief operating partner of Proskauer Rose. “Some days you have too much steak and not enough chicken. But you learn over time.” By way of this higgledy-piggledy path of experience, novice lawyers are hired and people eat. Few give a second thought to it all. But behind the scenes — at Manhattan’s biggest firms and biggest bistros alike — the process is distinct, divergent and far from streamlined, with precious few reliable numbers on which to predict future needs. How else to explain the scattered statistics of 25 international firms in terms of their New York office first-year associate classes from 2001 to 2003? At Clifford Chance, the first-year class slipped a bit between ’01 and ’02, from 56 young lawyers down to 52. But then between ’02 and this year, the downward slip was precipitous: from 52 to 34. On the other hand, first-years at Cadwalader, Wickersham & Taft rose from 51 two years ago to 63 today, but with a dip down to only 40 in ’02. Percentage-wise, some firms reported extreme swings. At Kramer, Levin, Naftalis & Frankel, for instance, hiring was up 70 percent in ’02, then down 41 percent in ’03. Others were steady to the point of statistical insignificance — for example, down 5 percent in ’02 and down 3 percent in ’03 at Paul, Weiss, Rifkind, Wharton & Garrison. This year, 16 of the 25 firms reported downward trends in their first-year classes, with the most severe drop being 52 percent fewer new lawyers at Latham & Watkins. Nine firms were on the upswing, with a 58 percent increase at Cadwalader. “The pattern is in the lack of pattern,” said Jacquelyn J. Burt, assistant dean for the Center for Professional Development at the Benjamin N. Cardozo School of Law. Drawing from her prior experience as a member of the recruiting and hiring committee at the New Jersey firm Sills, Cummis, Radin, Tischman, Epstein & Gross, she added, “This doesn’t strike me as unusual at all.” FOUR FACTORS Law firms must predict their first-year needs at least two years in advance. Generally, four main factors figure into the decisions: evaluation of the latest crop of summer associates, anticipated needs of each practice area, the firm’s overall business plan, and national economic trends. Of these factors, summer associates loom largest. Accordingly, there is a base number from which to begin the first-year class size decision. “If we hired someone for the summer and they’ve done a good job, we’re going to give them a permanent offer,” said Paul Mourning, hiring partner at Cadwalader. Summers are typically given permanent offers in August, which must be held open until November or even December under campus interview rules. Mourning said firms abide by such rules because, “It’s hard to find good people otherwise.” “With us, it’s basically what the individual partners in charge of the various practice areas project out over the next couple of years,” said Dana Stephenson, director of attorney recruiting at White & Case, which reported a 12 percent increase in its current first-year class, but a 33 percent drop between ’01 and ’02. “That’s essentially where it comes from — in conjunction with the firm’s plans to develop in certain areas. But who knows whether they’re right or wrong?” The trick for Stephenson and her counterparts at other firms comes in the necessity of having to make more permanent offers than necessary to successful summer associates, given a universal rule of thumb in big firm experience: a rate of acceptance from summers of about 70 percent. “Everybody works on that historical number,” said Stephenson. “We know that the majority of our candidates have offers from our competitors.” An additional number is used to help calculate a first-year class at Proskauer, said Kafin. Each partner in a given practice area should have at least one junior associate working on a full plate of matters. At other firms, he said, the ratio might be one partner to 1.5 or 1.3 junior associates. Burt said she has heard of the ratio being as high as one partner to three associates. All large firm officials interviewed said they preferred to err on the side of smaller first-year classes, despite clear disadvantages in relying on lateral hiring in the greenest ranks. “Long-range decisions are hard to reverse,” said Kafin. “Once we make an offer, we’re not going to take it away. So we try to hire at the low end of our estimates.” To Kafin’s mind, a first-year class decision is in some way keyed to the inevitable attrition of second- and third-years. Stephenson agreed, citing the “musical chairs” experience of young lawyers shifting laterally to other firms after a year or two. While Stephen would not hazard a guess on the attrition rate, she said it was probably well below 30 percent. Sometimes, the conservative approach to determining a first-year class size is the chancy one. During the booming economy of 1999 and 2000, Kafin recollected, his own firm and many of Proskauer’s competitors were understaffed in terms of junior associates. “It was a real problem,” said Kafin. “Everybody was bidding from the same talent pool. And the lateral market is not always booming.” Nonetheless, Kafin and others hew to the conservative approach. Regarding layoffs, David L. Taub, a deputy managing partner at Clifford Chance, said, “Reducing the incoming class size is always preferable to the alternative.” The current crop of first-years at Manhattan firms have their jobs thanks to decisions made in the fall of 2001 — at the height of economic recession, exacerbated by terrorist attacks. “It had an impact,” said Taub of White & Case. But before 9/11, “our management team had made its decisions,” he said. Such was also the case at Proskauer. Nonetheless, Kafin said second-guessing was especially strong in the fall of 2001. “I can tell you, we took a deep breath,” said Kafin. “There were huge, pessimistic forces that were pressing for a great, great deal of conservatism in our [first-year] hiring. “But you can’t make long-term decisions based on single events — even horrible ones like 9/11 — that could affect you really through about 2007,” he said. “We knew we had to get through this, and so we knew we would get through it. So we stayed with the long view.” Outside events as well as critical needs within a particular firm result in the widely differing figures reflected in the past three years of new associate classes. As Stephenson put it, “Volatility is part of the territory.” Burt agreed. Law students and young lawyers, she said, should understand that “extreme fluctuation within firms, within a short period of time, do not always spell problems.” Cuts in entry-level hiring, said Burt, do not necessarily reflect anything negative about a firm. Conversely, a bulge number in hiring may simply mean — and usually does — that a firm has taken on a new client. Related chart: New York First-Year Class Size 2001-2003

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