In-house compensation in the UK stayed flat or dropped over past three years

“In 2004, a five-year qualified lawyer could expect to earn a base salary of about £68,000, a figure which since then has dropped to £63,000 last year and £62,000 this year.” This quote, from Legal Week, Vol. 8, June 22, 2006 at 13, came from data of recruiters Laurence Simons. For a 10-year qualified in-house lawyer, the average base dropped over the same period from £98,000 to £90,000. Other UK recruiters similarly found salaries static or falling. In this buyer’s market, the gap between in-house and private firm pay is widening.

Neither increased benefits nor share option benefits account for the flat line of compensation, according to the article, but the over-supply of private lawyers who yearn for a corporate position is the culprit that depresses salaries.

I wonder. Did the same companies participate all three years? Did law departments that pay above the reported averages tend to drop out of later surveys, because the data did not help them lobby for raises? Did the law departments have lawyers in more locations, particularly lower-cost (and thus, pay) locations? Is it at least theoretically possible that the quality of lawyers from firms who sought in-house positions dropped, which explains some of the lagging pay? The oddity of real income dropping causes me to wonder.

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