It appears that the salary wars have made their way to London. With London salaries rising into the neighborhood of £65,000, and with the current exchange rate over two $/£, the gap between New York and London salaries is narrowing considerably. This from the London Times Online:
City sources said newly-qualified lawyers at A&O would be offered salaries of £65,200 – above its magic circle and other UK rivals.
The latest pay rise pushes Allen & Overy into the territory of US law firms that typically offer between 20 and 40 per cent more than UK firms in an attempt to lure away skilled lawyers.
Chris Hickey, a legal recruiter at Robert Walters, predicted that several large US firms, whose London offices are enjoying a significant boom on the back of strong private equity and mergers and acquisitions markets, would also be forced to revise their salaries upwards.
With, as the article points out, U.S. firms typically paying 20-40% more than UK firms in London, the U.S. firms may soon be paying their associates in London more than their associates in New York. This will in turn likely force the NY salaries even higher. Could we soon hit $200,000 for first year associates?