If you’ve wondered how much replacing that associate or senior associate who just left you is going to cost, then a recent report from Big Hand provides the answer: circa $500k.

That’s right, a cool half a million dollars!

Those costs won’t always be upfront and apparent, they will include:

• a possible increase in salary for your replacement associate over your previous associate’s salary (due to market pressure) – which is somewhat ironic as salary may well be the reason the old associate left you!
• commissions to talent agents to find you said new associate
• increasingly – signing on bonuses
• training costs over the first 12 – 18 months to bring the new associate up to scratch on your firm’s systems and business development strategy.

The list of actual and hidden costs here is almost limitless, and so the overall cost to your firm of replacing that departing associate/senior associate could actually be a lot more than $500k. Which begs the question:

with 49% of surveyed firms having said they had experienced an increase in associate attrition, you have to wonder why this isn’t an area where more firms are focusing their attention?

You also have to ask: Does asking someone to work 2,000 billable hours a year have something to do with these attrition rates among associates?

And with 75% of surveyed firms having said they have seen a drop in demand for legal services, is this a cost you really want to be incurring right now?

If you need help looking at your firm’s strategy, how to retain associates and differentiating your practice from the crowd, get in touch!

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