Empire Search Co-founder & Partner Scott Yaccarino offered The American Lawyer his insight on the current compensation trends in both the lateral associate and lateral partner markets. Scott says there’s “a fairly stark difference” between the lateral associate market a year or so ago—when demand was still exceeding supply—and the market now in 2023. “Firms do not have to pay signing bonuses right now,” he noted. “They don’t pay signing bonuses because they want to. They pay signing bonuses because they have to. It’s what you have to do to attract and dislodge that volume of candidates.” In the present lateral associate market, that’s no longer necessary.

But Scott joined other legal talent experts in observing that the lateral partner markets have yet to cool down. “I don’t think that looks much different now than it did then,” said Scott. He notes that signing bonuses for lateral partners are “not something firms were just throwing out there because they were desperate to attract talent.”

Considering both the lateral associate and lateral partner markets together, Scott describes lateral movement generally as having “stabilized” rather than slowed. “At one end of the spectrum is what we saw last year and in 2021, that was one end, where demand far outweighed supply. At the other end of the spectrum, which is what happened in 2007 when the subprime fiasco took the economy down, there was little to no lateral associate market at the time,” Scott said. “So when I say things have stabilized, most of the time, the market tends to be in-between those two goalposts. That’s not to say there aren’t still firms bringing on lateral capital market and finance attorneys. There are still firms bringing on associates in all kinds of areas. But it’s very, very different-looking than a year ago.”

Check out the full article originally published on The American Lawyer: Attorney Compensation: Flush With Cash or Pulling Back?