S.F. Daily Journal - Aug 27, 2001 Despite Downturn, Associates Have Options Industry experts say Cooley's layoffs won't be the last, but note opportunities elsewhere for young lawyers.   By Erik Cummins Daily Journal Staff Writer         SAN FRANCISCO - The worm has turned.         It seems as if only yesterday young associate lawyers were in the driver's seat. In Silicon Valley, jobs lay thick on the ground. Salaries were high and associates and partners moved around freely.         Now, 85 Cooley Godward associates and 50 staff members are out of work, effective Aug. 31, victims of the first major Bay Area law firm layoffs in a decade. Observers figure that number could easily grow, as other firms follow Cooley's lead.         In Cooley's case, San Francisco recruiter Avis Caravello isn't worried about the fate of those laid-off Thursday.         "They are all good people coming from a good firm," she said. "People will find jobs - some at national law firms, some at small and mid-size firms, and some will have to relocate. Their chances will depend on how experienced they are, where they went to law school, how well they did and what areas they focused on."         But job-seekers are no longer in the driver's seat, she said. Law firm hiring partners are.         "They know the market is glutted with candidates," she said. "They can take their pick, which is a luxury they haven't had recently."         The last two years spoiled lawyers looking for work, she said.         "We all got very comfortable. If you were smart and well-credentialed, the question was, 'Where do you want to work?' Now, you have to go where the openings are."         Last year, associates were getting 10 to 15 job offers. Now, she said, they're getting only three or four.         Unlike during the recession of the early 1990s, the Bay Area's biggest law firms haven't begun to rescind offers to their summer associates. Even Cooley, which announced the biggest layoff in recent memory, will welcome more than 80 new associates this fall. (Firms that rescinded such offers in the early '90s found their recruiters weren't terribly welcome at law schools afterward.)         "So far, fall [associate] classes are intact," said Caravello. "But if the shoe drops, they could be the next thing to go."         Brobeck, Phleger & Harrison, which has promised not to lay off lawyers, has cut back on its lateral hiring to make up for the slowdown in corporate work. The firm also is transferring many of its associates from slow departments to busy ones, such as bankruptcy, securities and IP litigation.         In addition, attrition is helping to compensate for the downturn, said Molly Lane, the chairwoman of Brobeck's hiring committee.         Despite the hiring slowdown, the 900-lawyer San Francisco firm hasn't rescinded any of its fall offers; 80 associates will join the firm in October.         Regarding lateral hires, Lane said, "We haven't hired many people recently. I wouldn't go as far to call it a freeze, nor would I go so far as to say we are hiring actively."         Others firms, such as Heller Ehrman White & McAuliffe, have frozen lateral hiring. But like Brobeck, Heller hasn't revoked offers to its fall class.         Michael Rugen, the co-chairman of Heller's hiring committee, said his firm is in better shape than tech-dependent firms.         "We are a much more diversified practice," he said. "The downside is that we didn't enjoy as much of the bubble, but we aren't hurting because the bubble burst."         Layoffs at Cooley, he said, can't help but change the job market.         "I don't think that many firms are hiring laterally for associates or partners," he said. "This summer, we also saw a more serious group of summer associates. They were much more interested in long-term job prospects."         Rugen isn't sure how Cooley's laid-off lawyers will fare.         "I suspect they will find jobs at smaller firms and in-house," he said. "But if you have an electrical engineering degree and a good law degree with good grades, you're a hot commodity."         Keith Wetmore, the chairman of San Francisco's Morrison & Foerster, said his firm has been hiring laterally in some selected areas. The firm also will add between 70 and 80 associates this fall.         "If you are experienced and well-credentialed, I probably have work for you, particularly in securities and patent litigation," he said.         Nor is it necessarily a bad time for law students interviewing for summer clerkships next year. Wetmore predicted they'll probably miss the downturn.         Lori Nelson, the director of career services at Boalt Hall, said she experienced a similar downturn as a placement representative at USC in the early '90s. She sees many similarities in today's market.         "This time, Cooley took the first step," she said. "Our feeling at career services is that more firms will probably follow."         Opportunities do exist. She cited "exciting work" in Washington, D.C., New York, Chicago, Milwaukee and even in San Diego and Los Angeles.         "If you can look beyond Silicon Valley, do so," she said. "We're also seeing people looking to judicial clerkships for another year [after law school]. People are doing things to ride out the market."         Law firm consultant Pete Peterson said he hopes the legal market won't be as bad as it was in 1991.         "I recall [that] at firms on the East Coast and other parts of the country, first-year associates had offers and then got pink slips in the mail," said Peterson, a consultant with Hildebrandt International in San Francisco.         Associates shouldn't be the only ones to take the fall, he added.         "You can't just look at associates," he explained. "There should be performance reviews for partners. In well-run law firms, that happens all year long. They cull their [partnership] ranks methodically."         Job seekers should pursue their fortunes elsewhere, he suggested. Midwest firms, for instance, are doing particularly well.         Or even the Central Valley. Sacramento's Downey, Brand, Seymour & Rohwer, for example, has been hiring steadily for the past few years. Last year, its attorney roster grew by 15 percent and this year it plans similar growth.         With first-year base salaries at $75,000, the firm doesn't match Bay Area salaries, which can reach as high as $135,000. But, billable-hour requirements are also lower, said Downey Brand's managing partner James Day.         "You can probably afford to buy a house on a first-year associate's salary and have time to put in your yard and take care of it," he said.         Peterson isn't worried about the fate of young lawyers. In fact, he said, "When you're young, you have a lot of rebound potential. Just widen your horizons."