It takes little discernment to conclude that "Adam Smith,
Esq." could be more appropriately subtitled "…an inquiry into the economics
of [Big] law firms."*  Not only would this
conclusion be correct, but since I know for a fact that you, dear readers,
are an exceptionally discerning lot, I am telling you nothing you don’t
know.

Still, the question arises as to how much of the total landscape of
law-firm-land I am consciously overlooking.  Today we have an answer.

According to the US
Census
, in 2003 (most recent statistics available),
the total revenue for "taxable" (i.e., not non-profit) law firms was
$178.95-billion.   Meanwhile, over at the Bureau
of Labor Statistics
(the government is not known for its embrace
of one-stop-shopping), we learn that about 521,000 lawyers were employed
in for-profit law firms (i.e., not government or in-house corporate).**
 

And thanks to The
American Lawyer,
we
know that the total revenue of the AmLaw 100 for 2004 was $46.04-billion
and that those firms employed a total of 68,186 lawyers.   Now
you can see this coming, right?

AmLaw 100 vs. All Law Firms
AmLaw 100
Non-AmLaw 100 Law Firms
% of lawyers (headcount)
13.1%
86.9%
% of total (private) legal industry revenue
25.7%
74.3%
Average revenue/lawyer/year
$675,200
$293,400

You can thank Craig
Williams
for setting me loose on this trail.

What do I conclude?  First, that the focus of this blog is not
about to change.  Second, that it would be interesting to see an
historic time-series of this data.  My educated hunch?  The
AmLaw 100’s share of total legal-industry revenue is growing, as is their
share of lawyer headcount:  But revenue is growing at a faster rate.


*The phrase "an inquiry into" is lifted from the full title of Adam
Smith’s 1776 masterpiece, which is An Inquiry Into the Nature and
Causes of The
Wealth of Nations
.

**The 521,000 figure does not appear directly on the page I cite, but
I derived it from their total full-time lawyer headcount (695,000) combined
with their observation that "3 out of 4" lawyers are work in law firms
of all sizes (including solo practitioners).

Related Articles

Email Delivery

Get Our Latest Articles Delivered to your inbox +
X

Sign-up for email

Be the first to learn of Adam Smith, Esq. invitation-only events, surveys, and reports.





Get Our Latest Articles Delivered to Your Inbox

Like having coffee with Adam Smith, Esq. in the morning (coffee not included).

Oops, we need this information
Oops, we need this information
Oops, we need this information

Thanks and a hearty virtual handshake from the team at Adam Smith, Esq.; we’re glad you opted to hear from us.

What you can expect from us:

  • an email whenever we publish a new article;
  • respect and affection for our loyal readers. This means we’ll exercise the strictest discretion with your contact info; we will never release it outside our firm under any circumstances, not for love and not for money. And we ourselves will email you about a new article and only about a new article.

Welcome onboard! If you like what you read, tell your friends, and if you don’t, tell us.

PS: You know where to find us so we invite you to make this a two-way conversation; if you have an idea or suggestion for something you’d like us to discuss, drop it in our inbox. No promises that we’ll write about it, but we will faithfully promise to read your thoughts carefully.