Minneapolis Law Firm Market 2022
The partners: Lateral market partner activity resumed this year after being suspended since March 15, 2020. Prior to COVID, the top reasons partners considered moving to another business were: 1) lack of trust in the company’s management ; 2) disagreement with the management of their company; and/or 3) their practice has exceeded their practice. These reasons are always at the heart of the concerns of most partners who are considering a move. But after COVID, by far the #1 the reason partners consider moving is the lack of support from associates or junior partners in their current practice. The partners work too hard on the tasks and the proper work for the more junior lawyers. The partners seek to free themselves from these burdens.
Associates: 2021 has been the busiest year in recent times for the Associates movement in Minneapolis. Most of the activity has been in the corporate/mergers and acquisitions arena, with the majority of associates moving to larger companies or companies with a broader geographic footprint. The associate market is much quieter this year. We see this slowdown in associate movement – both here and nationally – as a return to normal (i.e. associate movement levels in 2019) rather than a worrying slowdown. In some practice areas, namely corporate and real estate, the demand for talented associates exceeds the supply. We hear that some associates have fallen behind in their professional development during COVID. This is a concern flagged by partners early in the telework phase of the pandemic. Now, associates are expressing this concern more frequently. Will they catch up? Will they have to move for this?
Junior partners: I have closely observed this cohort of law firms this year. How would companies handle compensation for this group after the significant increase in associate salaries in 2021? The companies seem to have responded to these concerns by combining a pay rise with convincing junior partners to agree to be “owners” and play for the long haul.
Minneapolis Market Economic Indicators: The number of national law firms interested in entering this market around a group of partners or via a merger has decreased compared to the feeding frenzy that took place between 2016 and 2019 when 11 firms entered this market . But the interest remains; we are currently working with a company that wants to enter this market and several other companies have expressed interest. At the associate level, at least two companies are raising first-year salaries to $190,000 on Jan. 1, 2023, a clear sign that competition in Minneapolis for associate talent remains fierce. Finally, reports of reduced “deal flow” nationwide (mostly on the coasts) have yet to hit business practices in Minneapolis, suggesting that any recession that may hit the legal sector could be missed. the middle market.
©2022 Major, Lindsey & Africa, an Allegis Group company. All rights reserved.National Law Review, Volume XII, Number 256