The September 20, 2010 Crain’s Chicago Business did an article on how some former Chicago big firm lawyers, having been downsized, are now starting their own firms. The article goes into detail about where the particular lawyer had formerly practiced, what led to his or her departure, and the trials and tribulations these lawyers face as they learn to practice in leaner, less grandiose settings. One lawyer remarked that after pizza parties, they had to clean up after themselves. The horror.
One part of the story that received only a passing reference was the hourly rates these lawyers had charged at their old firms. None of them were charging their clients under $400 dollars an hour. Most of the attorneys were billed out at around $500 an hour, and a couple were billed out at even higher rates. Most of the lawyers discussed were in their early 40’s. Probably all very good at what they do, but none of them were names I recognized. [In fairness, I am sure none of them would recognize my name either].
Is it any wonder these folks are losing their jobs? It’s tough out there. After some initially encouraging news, the latest unemployment numbers were bad. The real estate market is depressed and some experts are saying it will be years before values rebound. Builders aren’t building. Foreclosure numbers are through the roof. The landscape is littered with the remains of once-solid companies gone belly-up[Circuit City; Woolworth’s; Wickes Furniture; Sportmart, just to name a few]. Smart firms will take note and act accordingly by reducing hourly rates, offering fixed fee arrangments and finding other ways to somehow contain legal fees. Those that don’t do so at their peril.