The key recruitment trend for quarter 1 of 2024 is that the top 7 NZ firms[1] are losing more lawyers than they are hiring – 1.3 lawyers left for every 1 hired. The NZ trend is in direct contrast to Australia’s top firms quarter trend that saw those firms hire twice as many lawyers as left.
Sources of hires for top firms
The main sources of talent for these top firms during quarter 1 were specialist/boutique firms (29%), overseas returnees (21%), national law firms (21%), and in-house (21%).
Breaking down the hires into the top firms, only 14% of hires were alumni returning to their old firms (less than half the rate of returning alumni hires in the Australian market in the same quarter, which was 30%). The practice areas in highest demand during this period were litigation and dispute resolution followed by public law, tax and corporate and commercial expertise to a lesser extent.
Interestingly, litigation and dispute resolution was also one of the top practice areas being sought by top Australian firms in quarter 1, and 3% of their hires were from NZ. These movements will no doubt be adding additional pressure to NZ firms looking to hire quality talent within the NZ market.
Unsurprisingly, the most sought after PAE band was 3-7 years making up 43% of lawyer hires, and specifically 5-6 years PAE made up 29%.
Lawyers leaving
In contrast, lawyers left mostly to go in-house (33%) and overseas (28%) rather than join other law firms. Interestingly, more lawyers left to go overseas (28%) than were hired from overseas (21%).
Lawyers leaving the top firms also went to national firms (6%), boutique/specialist firms (6%) and into chambers (6%). For those playing along (and are good with maths) it’s unknown where the remaining 28% of leavers went but it’s likely they’ll either pop up overseas, at another firm after a career break, or have left the legal profession altogether. While not the subject of this article, it’s interesting to see such a high proportion of lawyers leaving top firms without another job already lined up or with a notable break in between roles.
Firms are being more considered
From conversations with our customers, we understand firms are being more considered in their hiring practices and showing some caution around ensuring a business case exists for each new hire rather than automatically filling seats that become vacant. The Insource data supports this as firms are not hiring at replacement levels.
Alternatively, firms are struggling to find quality talent to fill those vacancies with responses to advertisements being minimal or non-existent (as we’ve heard from customers and our contacts in the industry) and the new challenges to hire Gen Z lawyers who tend to prioritise work-life balance and flexible work arrangements over traditional career paths with higher salaries but demanding schedules.
It’s clear hiring practices are more considered and focused than in recent months. Business cases to replace or create new roles are less likely to be approved where there is capacity within teams at present. The firms that are most successful in hiring the right specialist and quality talent for their business needs will be the ones who implement a long-term recruitment strategy supported by the right tools and people to engage with those tools. Insource partners with our customer firms to support them to achieve their specific recruitment goals.
To more easily make the best hiring decision, Insource customers have access to a pool of talent who previously worked with their workforce at another firm. Our customer firms can quickly identify the quality and specialist talent that is warmly connected to their workforce for hard to fill areas. Also enabling customer firms to start building relationships with ideal candidates far in advance of needing to hire through a softer approach via a former co-worker.
[1] Bell Gully, Buddle Findlay, Chapman Tripp, Dentons Kensington Swan, MinterEllisonRuddWatts, Russell McVeagh, Simpson Grierson
