Starting law firm associate pay has been flat since 2023, NALP reports

By Karen Sloan

May 28 (Reuters) - The median base salary for first-year associates at U.S. law firms did not budge over the past two years despite some large law firms raising starting pay to $225,000, according to the National Association for Law Placement.

First-year associates earned a median base salary of $200,000 in January — the same median from January 2023, when NALP last conducted its biennial U.S. Associate Salary Survey. The latest survey, released on Wednesday, suggests that the higher salaries adopted by some firms in late 2023 and early 2024 have not become the industry norm, said NALP Executive Director Nikia Gray.

"Without the stiff competition of the talent wars to push it along, the market is not moving as quickly to follow the few big firms who have announced first-year pay increases as we saw in the last cycle," Gray said in an announcement of the new salary report, which was based on data from 437 law firm offices, 87% of which are part of firms with 250 or more lawyers.

A softer marker with lower demand for associates has reduced the pressure on law firms to raise salaries, Gray said.

And those median salaries of $200,000 in 2023 would need to be more than $210,000 in 2025 to keep pace with the 5% inflation rate over that period.

Law firm summer associate hiring hit an all-time low in 2024, according to NALP, with the median number of summer associate offers per law firm office falling to six in 2024 from seven in 2023.

U.S. law firms have focused their recent hiring efforts on experienced laterals and reduced their summer associate and associate hiring amid uncertain demand and declining lawyer productivity, a January report from the Thomson Reuters Institute found. The institute shares a parent company with Reuters.

With lower demand for new entry level associates, relatively few law firms have followed in the steps of Milbank; Cravath, Swaine & Moore; Paul, Weiss, Rifkind, Wharton and Garrison and others that moved to $225,000 starting salaries in late 2023 and early 2024, NALP found.

The median starting salary among firms of more than 700 lawyers this January was $215,000, according to the NALP survey. Only 32% of law firms offices reported offering a starting salary of $225,000, and that salary was more prevalent in New York, Washington, D.C., San Francisco, Boston, Houston and Austin.

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