Survey Finds No Changes in Associate Median Salary

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Summary: With a big jump in first-year associate salaries last year, the effect has not yet been felt in median salary data.

Now that time has passed since most Big Law firms moved to a higher starting salary for associates, the effect, or lack thereof, can be seen on all firms. The trend started last year by Cravath, Swaine & Moore to increase the starting salary of associates from $160,000 to $160,000 had some wondering how the jump in salary would affect the overall trend in associate wages.

  

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New data released by the National Association for Law Placement (NALP) Inc. shows that the median salary for first-year law firm associates across the country has not changed since 2015. The average for the past two years is $135,000. The figure staying the same shows that even though the top law firms have an even higher starting salary, increasing the starting salary elsewhere has not yet caught on.

NALP executive director James Leipold was surprised by the results, stating, “It’s not what I expected to see. After all the publicity surrounding the move to $180,000, I fully expected to see the national median starting salary for law firms move upwards, but what the data reveals is that for the most part only the largest firms in the largest legal markets made that move, and while many offices are paying $180,000 to start, many are not.” The NALP surveys law firms every two years on their associate wages. The responses tend to come from law firms with 251 lawyers or more.

The results showed that even though the national median for new lawyers has not changed, larger law firms experienced an increased median starting pay. For law firms with 500 to 700 lawyers, the median first-year associate pay jumped from $125,000 to $160,000. This jump is likely due to the $180,000 starting pay in top law firms. Larger law firms with 700 or more lawyers say median starting salaries increase from $145,000 to $155,000.

The fact that the median starting salary at the largest law firms is lower than slightly smaller firms may seem strange. However, this is a reflection of a greater trend where the largest law firms do not follow a single set of guidelines. Some of the largest law firms are elite, global firms whereas others are divided up into smaller regional offices brought together by mergers and acquisitions. The firms comprised of a number of firms molded into one generally do not pay out the top salaries like the other type of elite firms do.

The NALP suspects that effect of the increased starting salaries at top law firms likely won’t be noticed for a few more years when it has fully sunk into all Big Law. When the previous salary of $160,000 was established in 2007, the effect on median salaries was not noticed until a number of years later.

They also noted that geography plays a large part in associate salaries. There are only a few firms outside the Los Angeles, New York, Washington areas that providing the high $180,00o pay.

Not surprisingly, the size of the law firm is also a major factor. First-year associates from firms with 500 or more lawyers were earning a median salary of $160,000 compared to smaller firms with 50 or fewer lawyers paying their first-year associates a median salary of $90,000.

Are you surprised by the survey results? Tell us in the comments below.

To learn more about the salary increase set by Cravath, Swaine & Moore, read these articles:

• Cravath Keeps Year-End Bonus the Same
• “Cravath Effect” Takes Place with Several Firms Upping Salary Rates
• Firms Follow Cravath’s $180,000 Base Pay Scale

Photo: flickr.com