• Firms raised rates for junior-tier professionals more sharply than for senior colleagues.

• Paralegals and associates saw some of the largest percentage increases.

• Top-billing partners at a few firms also received significant rate boosts.

An analysis of 2024 rate increases by Am Law 200 firms reveals a notable trend: junior professionals, including associates, paralegals, and litigation support specialists, experienced larger rate hikes than their more experienced counterparts, Law.com reports.

While rate increases for top-billing partners hovered between 8% and 10% at most firms in the analysis, a majority of firms increased rates for their cheapest partners by 10% to 15%. Rate hikes for firms’ least-experienced associates were even more pronounced at a handful of large firms.

The trend is visible across 14 firms analyzed, including Paul Weiss, Wilson Sonsini Goodrich & Rosati, and Cole Schotz. 

• For instance, Paul Weiss raised its starting partner rate by 12.5%, compared to an 8.4% hike for its highest-billing partners during the Enviva bankruptcy. 

• Similarly, Wilson Sonsini increased its entry-level partner rate by 15.7% in the Rite Aid bankruptcy, against a 9.9% rise for top-tier partners.

• At Paul Hastings, least-experienced partners became nearly 13% more expensive at the beginning of 2024 compared to a rate increase of less than 4% for top-billing partners.

Associates and Paralegals Feel the Shift

The dynamic was even more pronounced among associates and support staff. 

• Dechert and Akin Gump Strauss Hauer & Feld each raised starting associate rates by about 14% in early 2024, while top-billing associates at both firms saw smaller increases of 7% to 8%.

• At Cole Schotz, the starting rate for paralegals jumped by 21.2%, compared to a 4.6% hike for senior paralegals. 

Even as the firm raised rates for junior associates by 10%, it lowered the starting price for litigation support specialists from $405 to $295 per hour.

Select Firms Boost Top Rates

While junior professionals saw the sharpest rate hikes overall, some firms significantly increased rates for top-billing partners. 

In October, Dorsey & Whitney raised finance and restructuring group co-chair Eric Lopez Schnabel’s hourly rate by nearly 20% to $1,375 during the Water Gremlin Co. bankruptcy. By contrast, a partner with half his experience saw a 13.4% rate increase.

Broader Industry Trends

These mixed approaches illustrate a broader industry strategy to balance profitability with market competitiveness.

Across the legal industry, average rates rose by 9% through the first nine months of 2024, according to the Citi Hildebrandt Client Advisory. However, the emphasis on increasing rates for junior professionals suggests firms are seeking to maximize revenue at all levels.