updated on 03 March 2023
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The top pay for partners in City law firms has increased by 15% this year to a huge £738,728 per annum, new research by Crowe has revealed. This exceeded the earnings of their counterparts in the UK’s regional firms, who saw their earnings increase by just 5%, to an average annual sum of £313,845.
The increase came about following a rise in demand for lawyers’ services, as covid-related economic disruption triggered an increase in M&A deals, which in turn drove a boom in the need for legal services. In fact, more than three-quarters of City firms boosted their profits in 2022.
Across the legal profession, headcounts have increased by average rates of 4.2% and workers’ pay has increased by 4.9% as a result of firms capitalising on increased demand and competition to secure legal talent.
Clifford Chance saw its top earner paid nearly £5 million due to the firm’s record year and last year Osborne Clark LLP announced plans to pay bonuses of at least £2,500 to UK staff following a 19% increase in global revenue in 2021/22.
The report concluded that in total 90% of UK law firms saw an increase in revenue in 2022 and the sector as a whole grew by 12%.
Crowe partner Nicky Owen noted that despite the “headwinds” facing the wider UK economy the legal sector “again performed well” in 2022. She added: “The full impact of inflationary pressures and salary shifts may still be felt in the coming months, and the retention of key people has been identified as a core focus for management teams.”