US law firms just finished the best five-year economic run since The American Lawyer began keeping records. Now, headcount and salaries have outpaced revenue and rates – is the golden age over? Aric Press and John O’Connor report
It was fun while it lasted. In 2007, The Am Law 100 – the top-grossing law firms in the US – finished the best sustained growth spurt since The American Lawyer began tracking firm financials in 1984. For the first time, the firms showed five consecutive years of better-than-average growth in both revenue per lawyer (RPL), the key measure of law firm financial success, and profits per equity partner (PEP), the metric that has turned law firm managers into contortionists.
