City of London: Magic circle trainees less happy than others
The biggest City law firms are paying their trainees less than their US competitors but working them harder, according to new research showing how pay continues to spiral.
It found most newly qualified solicitors (NQs) in London are prepared to make the trade-off between salary and work-life balance, with the average salary at London-based top 200 firms now over £124,000 – 40% more than the average outside the capital.
While the gap between US and magic circle firms has been closing, “this year the very top US NQ salary nudged up just a little higher, sitting at £180k – that’s a whole 16.7% more than what the magic circle is paying their trainees”.
US firms paid NQs an average of £168,000, as against £150,000 in the magic circle and £94,000 at national firms.
Legal rankings and intelligence company Chambers and Partners gathered data from over 1,000 trainees working at 95 law firms in the top 200 for the Annual Report on UK Trainee Satisfaction, as well as data on newly qualified salaries.
The average London salary for newly qualifieds was £124,393, followed by Manchester (£67,719), Birmingham (£66,200) and Bristol ((£65,786), with newly qualified solicitors earning the least in Scotland (£53,500) and Belfast (£38,500).
The average number of hours worked by trainees every week did not correlate with salaries in London, where it was 50 at magic circle firms and 49 at US firms. For other London firms, it was 42 hours, and 38 hours elsewhere.
“That might not seem much, but it is an interesting distinction,” said the report. “The gap between both of these firm types continues to blur.
“Traditionally, US firms attract talent by reaching deeper into their pockets, while the magic circle uses its big reputation to keep top grads coming to their doorstep. However, in today’s landscape, both types of firms are fighting over the same client pool and talent pool for that matter.
“Many argue the term magic circle is either on its way out or is already obsolete, making way for a new category: the UK elite.”
Trainees in London generally worked an average of 45 hours, while those in top 200 firms outside it worked an average of 38 hours.
Overall, 87% trainees thought the number of hours they worked was about right, although 21% of trainees at magic circle firms described their hours as too high, compared to only 12% at US firms (and 3% at regional firms). This may be related to their perceptions of pay, Chambers suggested.
They were all also working from home less; while last year the most common policy mandate policy was three days in office, this year it was four.
The research found that, overall, those at regional firms were the happiest trainees with the most manageable levels of stress, while US firms’ trainees were the next happiest. The scores were close across the board except that magic circle trainees were significantly less likely to say that their stress levels were manageable.
One in 10 trainees (11%) identified themselves as neurodiverse. They were more likely to work in the more technical law firm departments, such as technology and transport, and less happy in generalist areas like litigation and corporate M&A.
While two-thirds of neurotypical trainees thought partnership was attainable at their firms, only 47% of their neurodiverse colleagues thought the same; 22% of the latter group thought it was a realistic aspiration, but not at their current firm.
Oxbridge backgrounds were most common among trainees at US firms (25% of trainees), compared to 21% at magic circle firms and 2% at regional firms.
While two thirds (64%) of trainee solicitors were female, they showed a marked preference for certain departments over others – employment law and property were the most popular, corporate and banking and finance the least.
Cait Evans, global talent head of research at Chambers and Partners, commented: “Trainees at the UK’s top firms show high levels of satisfaction across the board and while hours can be long, the vast majority appear to recognise that the increasingly high salaries on qualification, particularly for those based in London and at US and magic circle firms, come at a price.
“With significant variation across the country and by firm type, there are clearly choices to be made for aspiring lawyers, who should carefully weigh up the lifestyle they want to lead and against the rewards on offer.”
Ms Evans added that trainee preferences on practice areas would “likely have an impact on the make up of law firms in the years to come” so should be considered when firms made long-term plans.
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