Ah, so much blog crabbiness recently. Well here comes some uplift. Last week I learned one of the most amazing things I've heard yet in law school. No, really. I was truly astonished, which is rare indeed.
UCLA's financial controller gave a talk to my litigation class about the cost structures of large law firms. He asked us to ponder how much it costs to recruit an associate. Naturally we all thought about free meals, cruises on the managing partner's yacht, $2300/wk for a summer's worth of sweet FA.
But that's not the whole picture, he cautioned. Associates and partners have to visit schools to conduct interviews for OCIP. Then they have to do callbacks. These all take time which could conceivably -- actually, would definitely -- otherwise be billed to clients. So that's a measurable opportunity cost.
Then, you have attrition. After all the interviewing, many won't take the summer offer. After taking the summer offer and the wining & dining, some won't take the permanent offer (and some won't get the permanent offer.)
Thus you have to sum all these costs and divide them among the relatively small number of associates that will end up with their well-educated asses warming Aeron chairs on the 45th floor. That is the true measure of what it costs to recruit each of a season's worth of associates.
So what is the number per associate? I want you to think of your answer and then roll over the box below:
Nobody could believe it, but the Controller assured us that it is an accurate estimate for large firms.
Suppose you're a partner in one of these firms. Now wouldn't you be saying to yourself gee, if I could reduce attrition among my associates, I could recruit fewer each year, and just keep that money in my pocket. Judging from the actual attrition rates, I guess this interior monologue is not happening.
Anyhow -- for those of you headed to the world of big law -- if you think you have debt, console yourself by thinking of your employer, who has just shelled out big-time for the pleasure of your company.
18 Oct 05