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Jersey Boys (and Girls) Do Alright for Themselves

Tuesday, April 29, 2008 9:21 AM - By David Lat

new jersey small strong survive above the law atl.JPGTime for a shout-out to this writer’s home state. Over in New York, Biglaw lawyers tend to look down upon their cousins across the river. Dismissive jokes about “Jersey firms” are commonplace.

But large-firm lawyers in New Jersey are doing just fine, thank you very much. From a tipster:

As a Jersey guy, you may find this interesting: According to the NJ Law Journal, Lowenstein Sandler just became the first NJ firm with profits per partner in the seven figures: $1,102,700. Average compensation per partner is not far behind, at $977,500.

And it’s not just Lowenstein Sandler that had a good year. Although New Jersey firms slowed their hiring and trimmed equity partner ranks in 2007, showing signs of being affected by the dire economic times, they still did pretty well. From the New Jersey Law Journal (subscription):

Growth in total revenues and net profits [among the New Jersey Top 20 firms] thus slowed in 2007. Revenue rose by 7.67 percent to $1.53 billion from $1.42 billion in 2006, compared with a 9.6 percent hike in last year’s survey.

Profit growth was even slower, up only 5.62 percent to $519.3 million from $491.6 million, compared with a 9.9 percent bump the prior year.

When fewer lawyers produce more revenue, it means each is working harder. Indeed, revenue per lawyer showed a pronounced spike: up 5 percent to $517,650, more than three times the 1.4 percent rise to $493,000 reported last year.

Likewise, since there were fewer equity partners sharing the bottom line, profits per partner growth enjoyed an eight-fold increase, rising 6.62 percent to $594,100, compared with a sluggish 0.8 percent to $557,200 in last year’s survey.

By New York standards, PPP of $600K is small potatoes. But it’s still a handsome income — and grows more appealing if the hours, cost of living, taxes, and partnership prospects are better over in Jersey. [FN1]

Time for New Yorkers to think about jumping to the other side of the Hudson? Or time for another round of pay raises for Garden State associates?

[FN1] These matters are open to debate, of course. Some New Jersey firms, such as the super-profitable Lowenstein, have reputations as sweatshops for demanding a lot of their associates.

Streamlining for Austere Times [New Jersey Law Journal (subscription)]

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Posted in: Biglaw, Money, New Jersey, Partner Profits, Skaddenfreude

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