2021 Record Salary Increases
2021 Record Salary Increases
The average salaries for Australian lawyers at all levels have increased significantly in 2021.
What are the main contributing factors and the end result for salaries?
Read this article to understand the current market for Australian lawyer salary trends.
Since Australia closed its border in 2020, the domestic skills shortage has increased in many industries, the legal industry included. In previous years, the large firms would employ numerous overseas qualified lawyers on skilled worker visas, which is currently not possible due to the Government’s restrictions. This has had a significant negative impact on the supply of talented lawyers, whereas the demand from the law firms has increased during 2021.
Increased Volume of Roles
Within the M&A market, the 447 transactions executed in the first four months of the year, where the target company was Australian, accounted for $40.5 billion in deal value which is the highest on record since 1980 – according to figures prepared for The Australian Financial Review by data provider Refinitiv. Corporate M&A departments, within most law firms, have been operating at over 100% utilisation and have hired consistently through the year which has led to record numbers of job availability.
In-house Roles Becoming Increasingly Attractive
In-house legal teams are becoming more sophisticated every year and continue to lure top private practice talent. Joining a reputable in-house team is becoming an increasingly popular career option. Every year we’re seeing more lawyers at the 2 – 8 PQE level leave private practice for in-house roles.
As demand for in-house lawyers has increased, so have the salaries. In the last 3 months, our in-house team have received some of the highest offers we’ve ever seen, as in-house teams look to compete with private practice salaries. One lawyer we placed was offered $160,000 + super as a 2019 admitted corporate lawyer, giving them a salary increase of 40% from their top tier private practice salary.
International Firms Recruiting Top Australian Talent
In 2021 we’ve seen international borders reopen and US and UK firms headhunting top Australian junior and mid-level lawyers at rates higher than we’ve seen before.
In the US market, the recruitment drive for Australian lawyers has been particularly strong compared to previous years. ‘BigLaw’ US firms such as Milbank have increased first year lawyers’ salaries to $200,000 USD in 2021 and salaries like this make the market very attractive for our top Australian lawyers. The London transactional market has also been incredibly buoyant with a large volume of roles available for Antipodeans looking to spread their wings.
The Result – Strong Salary Offers in 2021
Due to all of the above factors, we have seen an ever-widening gap between supply and demand; there are not enough lawyers in Australia to satisfy the requirements of the major law firms. This has resulted in 2021 being a great year for job seeking lawyers looking for significant career progression and a pay rise. The competition between firms is intense as they strive to make the most compelling offers to secure their preferred candidates.
Of note, since the 2021 review season, we’ve seen the following salaries offered by our clients:
- a 3 PQE corporate lawyer offered $145,000 with a $15,000 sign on for a private equity team at a leading international firm,
- a 2 PQE corporate lawyer offered $130,000 at a leading international firm,
- a 2 PQE litigator offered $140,000 at an American firm’s Sydney office,
- a sign on bonuses for 2/3 PQE lawyers as high as $20,000,
- new senior associate salaries jump to $170,000 in NSW, $160,000 in Victoria and $150,000 in Queensland at the top tier firms, and
- a 2.5 PQE litigator in Melbourne offered $140,000 at an international firm.
If you would like further information on salary bandings and the market generally or are interested in a confidential discussion around your personal circumstances, please contact one of the Beacon Legal team.