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Grad oversupply limiting salary movement

An oversupply of graduates across the legal profession has led to hamstrung salary movement and strategic intake and retention of young lawyers, according to a leading recruitment firm.

user iconJerome Doraisamy 25 May 2018 Big Law
Graduate, graduation, law graduates
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Speaking to Lawyers Weekly about the 2018–19 Hays Salary Guide, Hays Legal managing director Darren Buchanan said up until five or six years ago, all law firms would offer article clerkships and traineeships for law students.

“Larger firms would take on up to 30 graduates, providing them with rotations for their first year, after which a certain percentage would be kept on,” he recounted.

“Today, however, these same firms will take on just five or six graduates and retain them all.”

Limited salary movement is occurring at the lower level for graduates, and for those with up to one year of post-qualification experience, due to oversupply of candidates at this level.

“It is a case of supply and demand. But anyone with experience in practice will go on to receive regular salary increases over time,” he said.

“For experienced legal professionals in professional practice, salaries will progress at the senior level in line with their experience.”

The trend of limiting intake and retention is “definitely the new norm”, he argued, but is somewhat in conflict with the large numbers of graduates coming out of Australian law schools.

“Another element is the large number of law students from first year already embedded within firms in other capacities,” he added.

“These existing employees take a portion of the graduate positions because they are already known to the firm.”

In response to the supposed oversupply of graduates, firms are finding it challenging to keep offering salary rises. It is made more difficult with entrenched salary bandings and conservative cultures, in the face of a need for agility in a fast-moving and evolving generation of new talent, he surmised.

“In contract, those firms that have made a conscientious effort to offer salaries above market rate are the ones attracting top talent from the shallowest pools,” Mr Buchanan said.

“A competitive offer doesn’t solely need to be about salary, though.

“Flexible working options, guaranteed bonuses and clear career progression paths are also highly valued by lawyers,” he said.

And even with a perceived surplus of candidates because of more universities offering law as a degree, specialist skills are very much in demand in legal practice, he said.

“Firms could increase the number of traineeships they offer to give students the opportunity to gain experience,” he suggested.

“This would have the added advantage of overcoming the high demand but short supply of lawyers with three or more years post-admission experience.”

The comments from Hays and Mr Buchanan come after research from the Australian Legal Practice Managers' Association showed that salaries for Australian lawyers have hit a year-year low

Jerome Doraisamy

Jerome Doraisamy

Jerome Doraisamy is the managing editor of Lawyers Weekly and HR Leader. He is also the author of The Wellness Doctrines book series, an admitted solicitor in New South Wales, and a board director of the Minds Count Foundation.

You can email Jerome at: jerome.doraisamy@momentummedia.com.au 

Comments (11)
  • Avatar
    Sounds like you chose the wrong profession. After 27 years as a solicitor, including partner, I’ve been a barrister fir 11 years. I have the same husband as 25 years ago, two kids, and I love my job. Do I work hard? Yes. Am I well paid? Yes. I also volunteer to judge uni and school mock trials, belong to a club and volunteer at the school canteen. I choose not to work 24/7, and I enjoy my life, hectic as it is. We are lucky to have challenging, well-paid jobs which are rarely boring.
    1
  • Avatar
    I get very frustrated reading some of these comments.

    From being an Associate at the Supreme Court to private practice, one simple rule applies. Lawyers are treated no better than marketers, accountants or sales people in any company I represent. What our profession fails to admit, is that whilst 40 years ago it was a privilege to be a lawyer, you had a certain standing in society, I now almost have to apologise for what I do. The top layer of the profession has gone through hardships to get there and are only more than happy to exert pressure on younger lawyers.

    Meanwhile, most of them have had extramarital affairs, have communication breakdowns with their children and in the end have only their sorry careers to concentrate on, because that is all they have nurtured all their lives. It is just not that good to be a lawyer, despite getting 98.5 on my enter, despite clerking at CU, despite having a decent salary, it is NOT worth it because I am now 42 and my life has passed me by. Now you may be entirely different and enjoy being used, manipulated so that at the end of your 30's you also get that partnership. And now that I have it, it's a joke.

    Everything is amazing, and nobody is happy.
    1
  • Avatar
    The law societies do absolutely nothing about the human tragedy which is the oversupply problem, while issuing urgent papers on human rights and refugee outreach. They are a pack of sneering elitist snobs who couldn't give a stuff about the small struggling lawyers.
    1
  • Avatar
    Chesire the Cat Monday, 28 May 2018
    Its because the Law Societies always have since time memorial will always represent the interests of law firms and their principals rather than the employees rather than being impartial by acting in the best interests of their members irrespective of their employment capacities. That's why they do not do anything as its not in their interests in upsetting their established membership base.
    0
  • Avatar
    There is an over supply of graduates and certainly, the law colleges would never admit it. Its simple, under supply will drive wages up, in contrast the current over supply of grads has reduced wages. I graduated 2 years ago with 1st class honours, I was short listed for several entry positions and offered around $30 to $40K a year and expected to work 60 hours a week. I now work as a lawyer in a government department and earn around $80K. However, every time we advertise for one position we have about 200 applicants.... Oversupply, definitely yes.
    1
    • Avatar
      It is my understanding that law societies/boards are receiving thousands of complaints each year from grads and juniors who have been underpaid. $30k is an unlawful wage (below the safety net). Disgraceful situation that no one in a leadership position is game to tackle.
      0
      • Avatar
        Wage exploitation should be tackled. So-called (unpaid) internships should be banned.
        1
  • Avatar
    I think the issue is also the supply of sub par junior lawyers. This reduced PLT scheme of 6 months pales in comparison to the 1 year articles and 5 year articles programs that used to be offered. The industry should encourage PLT to be increased instead of trying to get their juniors admitted quicker so they can charge out for them.
    2
    • Avatar
      Junior lawyers appear to fail to appreciate that a law degree is an academic qualification. Law is a profession you learn on the job, after uni. That’s why everyone wants you after 2 years PQE- that’s when you complete your apprenticeship and actually start making money fir the firm.
      1
  • Avatar
    Curious this fellow avoids the obvious and then blandly suggests big firms should just hire more graduates. If they're taking on far fewer graduates it must be because there isn't enough work for lawyers around. That is obvious in every part of the profession, save for a couple of fortunate, discrete pockets.
    3
  • Avatar
    But the guy from College of Law said there is no oversupply problem?
    0
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