AFR has published its June/July annual partnership survey. The survey lists the largest and best known law firms in Australia. Our analysis of the statistics published in the survey confirms our expectation that 2018/19 financial year was a good year for these types of law firms.
Some firms did better than others. Some merged ‘out of existence’. Some did badly but on the whole it was a year of growth.
We don’t have the final figures for the growth rate in 2018/19 GDP but it was likely to be around 2%. For the group of 53 firms listed in the AFR survey, law firm partner numbers increased by 3% over the 12 month period.
However, the number of new partner appointments were closer to 8%. Hence the dark side of new partner appointments is that to make way for 8% new partners, resulting in a net increase of 3%, means that 5% of partners had to vacate their positions.
Where did they go? Retirement, counsel roles, startup firms and forced exits would be some of the pathways out.
This is a good reminder that partnership in a law firm is not as secure a position as might be expected. At a minimum it will be secure only while partnership performance is maintained.