The compensation gap between New Jersey firms and national firms with New Jersey offices is not as wide as it once was, but first-year-pay growth is still depressed across the board, a New Jersey Law Journal survey shows.

Of the 25 firms with the highest starting salaries for New Jersey lawyers, 14 are based in the state, competing with 11 branch offices of huge out-of-state firms.

And their salary levels range only $5,000 to $20,000 less than the national or regional Goliaths.

Gibbons in Newark, Lowenstein Sandler in Roseland and Lerner, David, Littenberg, Krumholz & Mentlik in Westfield each offer a $140,000 starting salary. Newark’s McCarter & English pays new associates $135,000.

That makes them competitive with the out-of-state-based firms offering their N.J. associates the highest salaries: Patton Boggs, of Washington, D.C. ($160,000); Morgan, Lewis & Bockius, of Philadelphia ($150,000); and Proskauer Rose, of New York ($145,000). Patton Boggs and Proskauer have offices in Newark, while Morgan Lewis’ is in Princeton.

The pay disparity between local firms and regional branches is significantly smaller than what once existed, says David Garber, president of Princeton Legal Search Group. “There’s a much more level playing field.”

Still, first-year salaries at firms of all sizes are flat or in some cases have fallen — a far cry from the spikes during the boom of the late 1990s and the prosperous times five or six years ago.

The median starting salary is $130,000; the average, $127,340.

It’s another of the numerous trends attributable to a “fundamental change in law firm economics,” Garber says. “You have many more clients who are pushing back on fees. If you have an economic system where the client base is saying they want [fixed prices and discounts] … that has a bottom-line, immediate impact on what you can pay your attorneys.”

As a result, salaries stay flat, so that third-, fourth- and fifth-year associates aren’t bringing home much more than they were as new recruits, he adds.

Gibbons partner Peter Torcicollo, director of the firm's professional development, recruiting, associate retention and later hiring, agrees that the pay gap has narrowed and is enhanced by the quality-of-life advantages of working in New Jersey versus, say, New York.

Candidates “who can go to Sullivan Cromwell or a firm of that stature” have always commanded higher salaries in the New York market, he says. “But anyone who’s made a lifestyle decision to stay on this side of the Hudson … I always feel we’re right in there competing for those folks.”

Gibbons — which jettisoned its summer associate program a decade ago and made completion of a judicial clerkship a prerequisite to hiring — is willing to pay its first-year associates more than some other firms because they’ve already gained experience and fewer resources are expended on recruiting, says Torcicollo, who interviews 50 to 100 entry-level lawyers each year.

Joined by Gibbons, Lerner David and Lowenstein with a $140,000 starting salary are Philadelphia-based firms Blank Rome (Princeton office) and Drinker Biddle & Reath (Florham Park office).

Tied for the No. 10 spot are four firms paying a $130,000 starting salary: Riker Danzig Scherer Hyland & Perretti of Morristown, Pittsburgh-based Reed Smith (Princeton office), New York-based Herrick Feinstein (Newark and Princeton offices) and Day Pitney of Parsippany and Hartford, Conn.

Three firms paying $125,000 are tied for No. 14: West Orange’s Wolff & Samson, Philadelphia’s Ballard Spahr (Cherry Hill office), and Philadelphia’s Fox Rothschild, which has offices in Roseland and Princeton. Fox also has an Atlantic City office, where first-years are paid $110,000.

Tied for No. 17 ($120,000) are Hackensack’s Cole, Schotz, Meisel, Forman & Leonard and Morristown’s Porzio, Bromberg & Newman.

Greenbaum, Rowe, Smith & Davis in Woodbridge is No. 19, with a $115,000 salary, followed by three firms tied for No. 20, with a $110,000 salary: Haddonfield’s Archer & Greiner, Jackson Lewis of White Plains, N.Y. (Morristown office), and Wilentz, Goldman & Spitzer of Woodbridge.

No. 23 is Roseland’s Connell Foley, with a $108,500 starting salary; no. 24 is Norris, McLaughlin & Marcus in Bridgewater, with a $105,000 salary.

No. 25 is McElroy, Deutsch, Mulvaney & Carpenter of Morristown. Despite being one of the most actively hiring New Jersey firms in recent years, the firm pays first-year associates a $100,000 salary.

That’s not an accident, according to Nicole Alexander, a McElroy lawyer who is director of professional and business development: the firm has a robust bonus structure and reviews associates twice per year, she says, though she declines to indicate how much a typical bonus might be.

“I think that has enabled us to be more flexible in our hiring,” Alexander says. “We have not had any problems recruiting anybody.”

Alexander says job candidates typically know coming in that McElroy’s base salary is lower than other firms’, but “it never comes up.”

“When you’re one of the only firms who’s actually hiring, it doesn’t come up,” she says.

Ronni Gaines, president of Topaz Attorney Search in Livingston, echoes Garber’s sentiments that the gap between the regional and national firms has gotten smaller.

“They’re all reaching out to the same superstars,” says Gaines. “It certainly puts them on a more level ground.”

But she also agrees that pay has stagnated or decreased and, more troublingly, so have new associate classes.

“It’s sad. … It makes getting a job all [the] more difficult.”