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Last year the world's biggest law firms saw their lowest revenue increase in a decade, according to reports.
The mere increase of 2.8 percent showed revenue per lawyer was flat, while partner equity dropped one-half percent. The top 100 firms still brought in billions, and the most profitable partners made more than $5 million each.
But the revenue increase was lower than the cost of living increase in major American cities. It's not time to jump out of buildings, but there are signs of trouble ahead for BigLaw.
Up and Down
"Total revenue was $99.3 billion, and the gain was the lowest since the Great Recession," the ABA Journal reported.
Per lawyer, revenue for 2016 was the same as 2015 -- about $813,000. But equity partner profit was down to about $1.59 million; profit per lawyer, down to $317,000.
American Lawyer reported that Latham & Watkins was the world's largest by revenue with more than $2.8 billion. It was followed by Baker McKenzie, Kirkland & Ellis, Skadden Arps and DLA Piper -- all earning more than $2 billion each.
However, none of the top revenue-makers made the AL top three in profits per partner. Wachtell, Lipton, Rosen & Katz led that list with $5.8 million per equity partner. Quin Emanuel followed with $5 million, while Paul Weiss partners cleared $4.38 million each.
A New Normal?
"The new normal for the world's largest law firms is shaping up to be slowing growth and falling profits," Chris Johnson wrote for the magazine.
Times are better than during the Great Recession -- when gross revenue dropped 14 percent at firms like DLA Piper -- but the numbers show the recovery is slow if not stalled.
In 2015, revenues at the top 100 law firms increased by 3.1 percent, and partner equity rose 4.9 percent. In 2016, not so much.