As demand and revenue growth slowed down, New York law firm profits plummeted 18.3% through the first three quarters of the year, while head count and expenses soared, according to a bank survey of firms. So far, New York law firms have generally held off on personnel cuts tied to performance reviews—but that could be coming soon.
“We haven’t heard of New York firms doing these performance reviews as of yet,” said Owen Burman, senior consultant for Wells Fargo Legal Specialty Group. “But, we will likely see those in December and January. The numbers just aren’t there to support the staffing. They have all been suffering from a dearth of capital markets activity, and I’m not sure at what point they say they have had enough.”