It’s almost Independence Day! And the invisible hand that guides our robust, capitalistic system continues to exert significant downward pressure on the salaries of law firm associates. The crushing economic logic opined by some Brit — who would have gotten his butt whupped at Yorktown with all the rest of them — named Adam Smith inexorably leads to today’s announcement by Blank Rome:
The legal industry continues to evolve in the midst of challenging economic conditions. As we work to continue to position Blank Rome strongly for the future, we have reviewed and decided to reset compensation for our associates, with particular emphasis on the first few classes.
Uh oh. I think the redcoats are coming:
Effective July 17, 2009, pay will reflect a starting salary for new associates being reduced from $160,000 to $145,000 in New York; from $145,000 to $130,000 in Philadelphia and Princeton; and from $150,000 to $135,000 in Washington, DC and Wilmington.
This news annoyed our Washington D.C. tipsters most. Back in 2007, we reported that Blank Rome did not raise Washington D.C. associates to $160K. But the firm is scaling D.C. down today. A D.C. tipster tells us:
Wait. The firm didn’t raise us up during the good times, but is all too eager to push us down in the bad times. I’m so outraged I will …
Whatever, what I am going to do?
Come on, what would the founders say to that? You could at least dump some firm stationery into the Potomac.
After the jump, Blank Rome explains that that it was just following what the market would bear.
It’s not only first years at Blank Rome that will receive a salary cut. Veteran associates will be feeling a pinch too, but the most senior people won’t be on the front lines of this salary war:
Other classes will also be adjusted on a sliding scale of between 2% and 10%, which recognizes the relative contribution of our more senior associates.
Why is Blank Rome spreading the pain around to all of its associates? Well, it appears that the firm is doing this because the market has provided an opportunity that was too good to pass up:
This is a market adjustment. The Firm remains in strong financial health, and is on budget for this year.
We are confident that our actions are in line with evolving market conditions among our competition, and, more importantly, with the expectations of our clients. We remain committed to providing our clients with the highest level of service as well as continuing to grow and improve our position in the marketplace.
Let free market capitalism ring, baby!
You can’t blame Blank Rome partners for taking advantage of an opportunity to increase profit for the firm while lowering costs for the consumer. This is, after all, America.
Earlier: Nationwide Pay Raise Watch: Blank Rome Raises