Steve Nelson was quoted in an article written by Alison Knezevich, senior reporter at Law360 Pulse.
Law360 (June 15, 2023, 10:24 AM EDT) — Law firms in the nation’s capital are taking a harder look at government attorneys’ potential for generating business in the private sector as the hiring market has slowed, recruiters in D.C. recently told Law360 Pulse.
D.C. firms are still announcing hires from government agencies every week, picking up attorneys with federal experience in areas such as antitrust, health care and securities. But in the bumpy economy, job candidates are facing more questions about business development, recruiters say.
“Firms are doing more vetting with candidates who don’t have business — government [attorneys] or otherwise,” said Amy Savage, national chair of Lateral Link’s government transitions group. “They want to make sure they’re making a good financial decision.”
Savage said government candidates are still getting interest as D.C. firms “recognize the value” of government experience. But “they’re getting more questions about business development than they may have gotten last year.”
Amid news of firm layoffs, Savage said she has also noticed less interest from government attorneys looking to move into the private sector.
“For many of them, there is stability in their current positions,” Savage said.
The legal industry’s overall job market has cooled across the country so far this year, and data provided to Law360 Pulse by legal data company Firm Prospects LLC indicates that the same holds true for D.C. firms hiring from the federal government.
Firms in Washington have hired 75 attorneys from the federal government this year through the end of May. That’s down from 93 attorneys in the same time period last year, and 130 in the same period of 2021.
In total, firms hired 241 attorneys from the federal government in 2021 and 224 in 2022, according to the Firm Prospects data.
According to Justine Donahue, a managing director at recruiting firm Macrae, government attorneys are considered “investment hires” for firms because they don’t come with portable business to keep them busy from the start.
Donahue said that after the hiring frenzy seen in recent years, the current caution comes from firms reacting to wider economic conditions, as well as a desire to correct what in some cases was over-hiring.
Government candidates “still may be successful in making the move, but their options seem to be fewer” than a year ago, she said. Today, “there is more scrutiny around individual partner hires and how they might fit” and help grow business.
“The analysis on whether to hire someone is getting more internal discussion at the law firms,” Donahue said. “As part of that, they very much are analyzing not only where they might fit into the workflow of the law firm or the practice area, but, what’s the business case with this particular government hire?”
Steve Nelson, executive principal at The McCormick Group, said that given the economy, firms are more cautious about hiring anyone “who is not a sure bet,” a caution he added was not limited to public-sector hires.
Firms right now are “more cautious about hiring everybody, whether it’s people from other firms or from government,” he said.
At the same time, he said, hiring in D.C. is generally not as affected by economic downturns as other places because the city’s legal market is not driven by corporate work, said Nelson, who recently launched a podcast called “Steve’s Rules” and focused the first episode on the dynamics of firms’ hiring of federal officials.
Nelson told Law360 Pulse that he expects hiring from the government to pick up somewhat in the second half of the year.
For government officials looking to shift into the private sector, the third year of a presidential administration is a good time to do it because pressure to stay ramps up in an election year, he said.
“It will be harder for them to disengage [in 2024] because, particularly at the high levels, the administration will not be able to find a replacement,” Nelson said.
Leslie K. Miles, founder of recruitment and placement firm Topside LLC, said that, no matter the economy, there is always a sharp-eyed look at candidates’ potential for generating revenue.
Because lawyers leaving the government don’t come with built-in books of business, their business plan amounts to a list of all their nongovernment contacts who could be courted as potential clients, she said. Actually making those pitches, however, can be a tough adjustment for government lawyers who have been working in public service.
“Although candidates often perceive that what firms are looking for are relationships or expertise, or political savvy, what they really are buying is money,” Miles said. “And so people coming out of government, the thing that they have to adjust to is that … what they’re really offering is their potential client base.”
– Editing by Brian Baresch.
