Law Firms Extend Fewer Summer Offers as Recessionary Concerns Grow

In the latest sign that demand for entry-level lawyers is dwindling, a new report from the National Association for Law Placement shows that fewer offers were made for students to join summer 2023 programs.

While a majority of U.S. law firms maintained or increased recruiting activities in 2022 over 2021, the number of summer offers fell by nearly 2%—a notable decline given summer 2023 2Ls are in the class of 2024, which had an entering class size that was almost 12% larger than the class of 2023, according to NALP.

“What is clear is that the entry-level job market in the private sector is currently not growing fast enough to absorb the additional students in the Class of 2024 and that unless there is a strong 3L hiring market this year—which seems unlikely given recent trends—a greater percentage of these students may need to look at other market segments for employment after graduation,” NALP executive director Nikia L. Gray wrote in the report.

The data follows news of associate layoffs at several large law firms faced with overcapacity, after record hiring levels and massive summer associate class sizes in the previous year. In the only reported instance of a law firm deferring its incoming fall class last year, legal recruiters predicted that if recessionary concerns continue to hinder law firms’ growth plans, they’d likely materialize in the form of no-offers for a large number of 2023 summer associates.

The NALP report found that 44% of law offices made fewer offers for summer 2023 compared to 2022, while 46% extended more offers for the same period. Ultimately, the median number of offers extended to second-year students for summer 2023 programs was down just one, to nine offers from 10 for summer 2022.

However, activity remained robust. Over 81% of law offices visited the same number or more law schools in 2022 compared to 2021, and more than 69% conducted relatively the same number or more screening interviews, NALP said.

The findings indicate somewhat of a reversal of recruiting trends in recent years, in which summer classes have ballooned in size. In 2022, the average 2L summer program class size was 13, up from 12 in 2021, according to NALP. The offer rate coming out of summer 2022 programs remained high, with 97% of 2L summer associates receiving an associate offer and 89% accepting an offer. The offer rate to 1L summer associates to return for a second summer reached a historic high of 94% and had an acceptance rate of 73%.

The report also highlighted new recruiting norms that are expected to continue in the post-pandemic era, including more pre-recruiting and early offers prior to OCI.

Firms made more 3,145 early offers in total, representing 23.3% of all offers to 2Ls for summer 2023 programs. That is nearly twice the number of early offers made in 2021 and the highest figure reported since NALP began tracking early offers, according to the report.

Virtual recruiting has continued, the report found, with 93% of screening interviews and 77% of callback interviews occurring in a virtual format.

“It has become clear that the recruiting days of yore are not returning and that the developments born out of the pandemic are our new recruiting normal,” Gray wrote.

“However, as an increasing number of reports issued these past few weeks have announced falling partner profits, softening hours, and excess capacity at law firms mingled with projections of record rate increases and bullish growth for 2023, the only solid prediction one can make about the upcoming recruiting cycle is that it won’t be dull,” she wrote.