What's the outlook for newly qualified solicitors in London?
Rachael Fowler discusses the current London newly qualified solicitors market, highlighting some of the reasons why current trainee solicitors should feel positive about approaching qualification.
Many recent reports have painted a bleak outlook for NQ lawyers in London, with some observers pointing to various factors including low retention rates, hiring freezes and trainees being forced to find work outside London as significant obstacles to securing a job as an NQ. However, this is not the case; steady retention rates and increases in lateral associate hiring across the board have actually combined to create more opportunities for NQs than ever before.
Whilst retention rates at many firms in 2013 have by no means returned to the consistently high pre-Lehman levels of nearly 100%, they have certainly recovered from the 40-50% levels seen in 2009-2010. For example, firms such as Linklaters, Slaughter and May and Herbert Smith Freehills all reported retention rates of over 85% this autumn.
Some have suggested that the NQ market remains quiet as firms are looking to hire more at the 2-3PQE level, rather than investing in the training and development that comes with hiring at the junior end. However in reality this is simply not the case; whilst recruitment at the mid-level remains strong, there has certainly been an increase in firms hiring laterally at the NQ level and we have an increasing number of NQ instructions from law firm clients in London.
In fact, there has been a steady increase in the variety of practice areas firms are looking to hire into, as well as the range of firms hiring. In recent years, US firms, some of whom have no trainees coming through the ranks, have tended to be a good source of alternative employment for NQs. Whilst American firms continue to hire, we have also seen far more NQ instructions than in previous years from the top 50 UK firms as well as some of the West End and boutique outfits.
In addition, firms are not just looking to recruit into the more niche areas left unfilled by their own trainees; they are also broadening their hiring patterns at the NQ level. For example, the September 2013 qualification period saw a solid increase in the variety of banking and finance NQ roles, including restructuring, structured finance, leveraged finance, real estate finance and shipping finance. There are also more opportunities for NQs to move internationally, especially within the Middle East and Asia, although local language skills are a real advantage for those looking to do this.
All of this contributes to what continues to be a highly competitive NQ market. However, with such a range of NQs on the market, firms are being forced to become more astute when differentiating between them. Having additional qualities like language skills or additional secondment experience will all be highly valued, and, more than ever, personality fit is considered crucial. This willingness to consider other skills arguably moves the market away from what many have referred to as a “dog eat dog” NQ market, dominated by the Oxbridge-educated Magic Circle trained NQs. Also, the competition is not confined to just the NQs; firms are increasingly having to differentiate themselves in order to secure the candidates that they want. This has resulted in some firms having to review their compensation packages in order to be as competitive and attractive as possible.
How then can current trainees make the most of this situation?
· Seek client and international secondment opportunities early in your training contract. This will broaden your experience and exposure to different businesses and practices. The only caveat to this would be that many secondees find it frustrating being out of the office when decisions are being made regarding qualification, so try and do this sooner rather than later.
Use language skills in a business context. Being able to demonstrate use of these within a business environment and not just mentioning them on your CV will make you stand out. Having additional language skills may also give you the opportunity to work with other teams within your firm and give you exposure to work outside your dedicated seats.
· Dictate your own workload (as much as possible). If you are particularly interested in a specific area of law, seek to gain as much exposure as you can within it, particularly if it is going to be your first choice when approaching qualification. For example, if your interest is shipping law and you are sat in a broad asset finance team, ensure you are pushing to work on as many shipping deals as possible. In doing so you will be demonstrating your enthusiasm and commitment to the particular area of law.
· Research opportunities. Even if you are entirely confident of being retained at your current firm, approaching qualification provides the ideal time to see what else is out there. With the increase in lateral NQ hiring you could find your ideal role. Also, if you are being retained this puts you in a very strong position when applying externally.
· Consider interim/contract positions. There is often the potential for these roles to become permanent and the experience gained can be highly advantageous for NQs. Working as an interim can provide invaluable experience, often in a niche area, and help you avoid gaps in your CV while searching for a permanent role. Such positions can also allow you to test the fit of an organisation or type of role.
· Research the market and seek assistance from a trusted recruitment consultant. They will be able to provide tailored advice on the best course of action based on where you sit within the NQ market, i.e. with regards to your academic qualifications, the firm you have trained with, your specific experience and your preferred area(s) of law to qualify into.
We expect the London NQ market to stay buoyant. Every prudent trainee solicitor should seriously consider their career options and think about whether to stay with their current firm on qualification or seek a new role as the decision you make now may have a significant influence on the rest of your legal career.