Philadelphia-area law firms cutting back on summer internships

For top law school students, summer-internship programs at big, brand-name law firms have helped open the golden door to lucrative full-time employment.

But at some firms, that door is starting to swing shut.

Many prominent law firms in the Philadelphia region and around the nation report substantially smaller internship programs this summer, as firms cope with the downturn in the legal marketplace and client demands that only seasoned lawyers be assigned to their matters.

What's more, firms are shortening their programs and paying summer associates less.

The changes range from canceled programs at the Center City firms of Morgan Lewis & Bockius L.L.P. and Ballard Spahr L.L.P. to reduced internships at Dechert L.L.P., Blank Rome L.L.P., and Reed Smith L.L.P., a Pittsburgh-based firm with a 150-lawyer office in Philadelphia.

Dechert went from 99 summer-associate positions at the height of the legal market in 2007 to 36 this year. Reed Smith, a 1,600-lawyer firm, said the number dropped from a high of 81 in 2008 to 21 this year.

"It was definitely a challenging market for our students and they did have fewer choices for this summer," said Melissa Lennon, assistant dean in the office of career planning at Temple University Law School.

Three years ago, when law firms were booming, the market for summer associates was far more robust.

Law firms flocked to campuses to compete for top second-year students and brandished salaries as high as $2,700 a week or more.

And, summer associates typically received offers of full-time employment once they had their law degrees.

The programs themselves, with trips abroad and lavish entertaining, could seem more like summer enrichment for precocious college students than real employment.

But as a general rule, that sort of treatment is a thing of the past.

More typical is the summer program at the Wilmington office of Skadden, Arps, Slate, Meagher & Flom L.L.P., where Temple second-year Nick Mozal is spending his summer in corporate law. Mozal said there has been some entertaining, but the big event so far has been a night at a Phillies game.

He's just grateful to have summer employment with a big-name firm.

"I feel very lucky, and I was very excited for it to have gone so smoothly," said Mozal, who did his undergraduate work at Bucknell University and was raised in Exeter, a town in northeast Pennsylvania near Wilkes-Barre. "You can pick up the paper and read lots of stories about firms laying people off and [new hires] being deferred."

Jennifer Wallace, a summer associate at Duane Morris L.L.P., a 700-lawyer firm, said recruiters had warned during interviews last year that the market for summer positions would be tough. Even so, Wallace, a second-year student at the University of Pennsylvania Law School, received multiple offers.

"The hiring partners and the people affiliated with the process were very up front in terms of what I could expect," she said.

Law firms such as Reed Smith not only have reduced the sizes of their summer classes, they have cut compensation, eliminated some extracurricular activities, and shortened the programs to save money in a tough market. Reed Smith, like other big firms, had pegged summer associates' salaries to those of first-year lawyers.

When the firm reduced annual compensation for first-year lawyers by about 20 percent last year - from $145,000 a year to $117,000 for lawyers in Philadelphia - summer-associate salaries declined correspondingly. In Philadelphia, that meant the weekly summer-associate salary went from $2,788 to $2,250.

James Lawlor, a Reed Smith partner who recruits and hires summer associates, said the firm has been doing less entertaining of summer associates, and when it does, it is more likely to schedule events at the firm's Center City offices rather than at costly restaurants.

"We took away some of the bells and whistles," Lawlor said.

Since summer programs serve as pipelines for new hires, the cancellation of programs at Ballard and Morgan Lewis this year had a practical purpose beyond slimming down the number of new lawyers. Both firms, like many around the nation, had deferred the start dates for lawyers graduating in 2009 and 2010 by one year.

Had they proceeded with plans for a summer program this year for lawyers who normally would have started in 2011, the firms would have faced a large wave of new arrivals.

Both firms say they expect to have summer interns next year.

"We had a choice; there was going to be a day of reckoning where we would have two classes joining us in the same period, which struck us as undesirable," said Geoffrey A. Kahn, a Ballard Spahr partner specializing in commercial litigation and white-collar defense who oversees hiring and recruitment at the firm.

The de-emphasis of internships in Philadelphia tracks national trends. The National Association for Law Placement, a trade association that focuses on the training and recruitment of lawyers, said that for all law firms, the median number of summer-associate positions offered this year had dropped to seven from 10 last year and 15 in 2008.

Moreover, NALP said that firms had been doing fewer on-campus interviews. And when internships are completed, they are making fewer offers of permanent jobs.

"For the class of 2011, those who went through the on-campus interview process last year, there were many fewer summer-associate positions available," said James Leipold, NALP's executive director.

In general, it was the largest firms that cut their programs the most. Blank Rome, a Center City-based firm with more than 500 lawyers, reduced its summer program from 24 to 12, while lengthening it from six to eight weeks. Drinker Biddle & Reath L.L.P., with more than 650 lawyers, went from 37 summer associates in 2007 to 25 this year.

Yet others held steady or even slightly increased, such as 485-lawyer Fox Rothschild L.L.P., which recorded record profits last year. It has 12 summer associates this year, one more than last.

So the picture is not uniformly bleak.

Heather Frattone, an associate dean at Penn's law school, said the school's entire class of second-year students has managed to find some form of summer law employment, often going to work for the government or small firms.

"We still have a very large number of students working as summer associates," Frattone said.

Summer programs not only give law students practical exposure to the work they will do as full-fledged lawyers, they also serve as key recruiting tools. And that is why they've been reduced: Law firms project they will need fewer lawyers over the next several years.

But that doesn't make the programs any less essential, said Alfred Putnam, chairman of Drinker Biddle, which has instituted a novel training program for first-year lawyers aimed at providing practical exposure before they are assigned to client matters - and before their time is billed to clients.

"I am happy we still have a summer-associate program and I am happy we are still hiring," he said. "Unless you bring in new blood, the institution doesn't survive."