The 2009 Am Law 100 is in, and the first line of the report sums it all up rather well:
"Last year was the worst for The Am Law 100 since the early 1990s."
They're talking way early '90s - 1991 to be exact. And, because of the cutoff date for gathering data for the report, the dismal results don't even fully capture how horrendous the state of BigLaw has become.
Most troubling of all, the report predicts that the worst is yet to come. American Lawyer has created an alphabetical list of year-over-year percentage changes in gross revenue, revenue per lawyer, profits per partner and lawyer head count that's pretty telling.
The American Lawyer writers place the blame for the sharp decline on two main contributors: the drop in demand for legal services that accompanied the economic meltdown, and the huge growth in the number of lawyers in 2008. The writers point out that the firms had no control over the first factor, but total control over the latter.
As everyone knows, law firms are now exercising that control by tossing lawyers and staff on a regular basis. Once partners realized that the swelling of the ranks of associates was cutting into their profits, they started swinging axes around their offices like entrants in a lumberjack competition.
For solo and midsize firms, however, all the gloom and doom for the Am Law 100 might translate into some positive developments. As mentioned before, the falling demand for BigLaw legal work might translate into work for firms that offer more value for their services. Some legal matters don't go away, even in a recession, and budget-conscious clients might migrate to firms that can offer them more bang for their buck.
One thing's for sure: the days of BigLaw wine and roses are over - at least until the economy improves and the mantra once again becomes "let it grow."