Where are the partners of 2014?
We looked at the partner-number statistics of the Australian Financial Review’s (AFR) July 2014 list of major firms and lined them up against AFR’s current 2017 list.
AFR’s list in 2017 had 16 more “major” firms than in 2014. This year there were 51 firms in the list. Most of the new entrants to the list were not major in the sense of having a large number of partners.
What is a major law firm?
One type of new entrant to the list was the global firm. These firms typically had a small number of Australian partners. They were: Clyde & Co., Jones Day, KPMG, Clifford Chance, Ernst & Young, Deloitte and White & Case. The average number of partners of these particular firms was 14.
The larger 2017 list included Australian firms that had partner numbers on par or greater than the Australian offices of the global firms, such as: Johnson Winter & Slattery (64 partners), McCullough Robertson (51 partners) HopgoodGanim (42 partner) and smaller firms, DibbsBarker, Kemp Strang, Wotton + Kearney, Jackson McDonald, Holman Webb, Meridian Lawyers and Madgwicks.
Based on the 2017 AFR list, a “major firm” appears to be one which is a branch office of a large international firm or an Australian firm with at least 14 partners. This would mean that there are now at least 60 major law firms in Australia. Some firms did not step forward to be included in the AFR survey.
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No growth in overall partner numbers
For the group that appeared in both 2014 and 2017, the trends are stark. There was no real growth in overall partner numbers. Growth was less than one percent over three years.
The static number of overall partners did not mean that there was no movement of partners. From 34 firms, 17 experienced a decline in partner numbers. Half of the firms experienced a decline and half experienced a growth in partner numbers. That is an interesting symmetry.
Firms growing and shrinking
Some of the notable gainers were HWL Ebsworth, Hall & Wilcox, Moray & Agnew, Mills Oakley and Sparke Helmore. It was not all one way traffic at these growing firms but they did experience net gains over the last three years.
Most of the declines came from the group that used to be known as the top tier. They have not been able to maintain their larger partner numbers or have chosen to move out of certain areas of work.
For the type of work handled by “major” law firms, there is strong evidence that the market for external legal services has been flat over the last three years. The movement of partners on the other hand has been more lumpy than flat. Of those firms that increased partner numbers, almost half of the increase was accounted for by only three firms: Mills Oakley, HWL Ebsworth and Hall & Wilcox.