Arthur Zurabyan, in an interview for PRAVO.RU, explained how the economic crisis has affected the legal services market
An economic crisis always has an ambiguous effect: certainly, there are many negative consequences, but some industries may benefit from it. The same is true for the labor market: on the one hand, the number of vacancies decreased, with the current crisis, and now an employer can dictate terms to a potential employee. On the other hand, the demand for some legal profession has held steady or even increased. Learning what changes have occurred in the labor market and adapting to them can help maintain or even increase one’s level of income.
The economic crisis in Russia has affected all markets, and the labor market was no exception. According to the research recruitment agency Antal, in December 2014, 38 percent of the companies held steady or wanted to reduce their number of employees, and 49 percent suspended their searches for new staff or planned to do so soon. Dismissals took place, although they did not acquire a mass character, while the number of vacancies markedly decreased. “Now companies mainly tend not to develop and not to open new projects but to maintain what they already have,” said Yury Dorfman, a partner at the Cornerstone headhunting agency. “Due to this,” he continued, “the number of open positions reduced. Now firms appear to replace staff because of ineffectiveness or because of attrition.” Maria Khandros, a consultant for the staffing company Kelly Services, agrees that there are fewer jobs and notes that the number of temporary projects has increased. She saw one impact of the crisis being stagnant wages, compared to previous years, while there are more than enough applicants. That allows employers to dictate their conditions and engage in wage dumping. Previously candidates counted on a bigger salary when changing jobs. Now, they are ready to retain the amount they had in their last place of employment, Khandros remarked.
Khandros indicated that at Kelly Services, for one position, with average market wages, there are eight to 10 candidates, but this figure triples for those customers who use the services of several staffing companies.
How much to pay a lawyer
Small firms and public-sector enterprises often seek employees themselves, and it is logical that competition for their jobs may not be high, especially taking into account that the wages for their positions are usually low. In general, competition in the labor market, without any division into professions, is now five people for each position, according to SuperJob, and 6.8, based on HeadHunter’s data.
According to statistics from the website Rabota.yandex.ru, which handles the largest number of job openings, the average offer for a lawyer in Moscow is RUB 58,000 per month, while in St. Petersburg, it is RUB 43,000, and in other economically developed regions, such as Tatarstan, Novosibirsk, Chelyabinsk, and Sverdlovsk, it is RUB 25,000-28,000.
It is no secret that the level of wages for similar vacancies may vary significantly. The recruitment agency Kaus takes into account these features in its study of the third quarter of 2015. It identified three levels of salaries: minimum, average, and increased. The second level applies to lawyers, who get more in the fields of investment and real estate law (RUB 84,000), international law (RUB 88,500), and tax law (RUB 81,000). There is less money in areas dealing with debt (RUB 61,500) and the registration of legal persons (RUB 53,000).
Simple lawyers receive offers that average RUB 64,500, while leading, senior, or main lawyers can count on roughly RUB 80,000. A lawyer with high status will provide RUB 104,000 per month, which is close to the average “price” for a chief of a legal department, that is, RUB 115,000.
Less and More
Arthur Zurabyan, the head of Dispute Resolution and Mediation Practice of ART DE LEX., revealed how the crisis has affected legal consultancy. “The demand for the services of outside consultants, especially in such areas as mergers, acquisitions, and corporate law, reduced sharply. Since Russian companies have fewer opportunities to attract foreign financing through direct loans from foreign financial institutions, the number of outlets for IPOs sharply reduced. As a result, almost all the ILF and even RLF began to diminish their staff or at least stopped hiring.” According to Zurabyan, the salaries of lawyers have been frozen or even cut, and the same applies to bonuses.
Dorfman agreed that there are very few jobs in consulting. “There is no potential to grow, and it is important to keep one’s business and customers.” The banking industry slipped, he said, but the demand for positions in the judiciary, corporations, construction, retail, and pharmaceuticals remains steady. According to the observations of Khandros, most jobs now are focusing on contract law, and there are a lot of requests for compliance, that is, the management of legal risks, but the demand is for lawyers with appropriate experience.
Dorfman said that it is easier for mid-level specialists to find jobs because they are in demand, while the number of requests for “top” lawyers declined.
Zurabyan noted that the crisis has hit young lawyers, making it more difficult for them to find a decent job. “As in the major markets, for example, in the UK, experts appeared in Russia without experience, and they are ready for to work on probation, that is, free of charge.”
According to his observations, the greatest demand now is for litigation specialists in dispute resolution because the crisis is a time when companies do not fulfill their commitments on a massive scale and fall in bankruptcy. Nevertheless, he added that “there is a need for people with experience who are willing to work effectively but for low salaries, as compared to the precrisis level.”
Experience or education
The interviewees of PRAVO.RU agree that wide experience is an advantage in finding a job because mostly in-house companies have jobs available. For them, a flexible employee is important. At the same time, good nondiversified lawyers also may be in great demand, and there often is a “hunt for their heads,” remarked Dorfman of Cornerstone. He recalled that, “recently, for example, there has been a real war for a specialist in maritime law.”
In consulting, on the contrary, the depth of specialization is important, because, as in large law firms, there is a division into specialized practices. Although, Zurabyan, of ART DE LEX, noted that, due to cuts in consulting, companies appreciate professionals who can work with projects in different directions. The competition to get there is high, Dorfman said: “Applicants fill up law firms with CVs, although there are few jobs in the market.” As a rule, consulting companies have the most stringent selection conditions: good English and strong work experience. Candidates for consulting have high salary expectations, which often is associated with cash payments, Khandros added. “It is easier to switch from consulting to an in-house position, while doing the opposite is more difficult,” she warned. Zurabyan, however, said that it makes sense for a skilled person to go to a small company, during a crisis, or establish an independent one. In such a difficult time, it may help a person maintain or even increase their income.
Is a diploma from a certain university important for an employer? The interviewees of PRAVO.RU disagreed. Dorfman believed it is important and identified the following leaders: MGIMO, Moscow State Law Academy, Moscow State University, School of Economics, and People’s Friendship University. “Many customers ask us to show them candidates from the top universities,” Khandros said, “but, in the end, the preference is given to those who have more experience. A diploma from a prestigious institution can play a big role for very young professionals.” Furthermore, an academic degree will not help get a big salary, Dorfman added, but noncore specialty at a university, on the contrary, can create challenges. “A criminal law specialization, if a person does not work for the police, is always problematical,” remarked Zurabyan. “Maybe a person might have been following the path of least resistance, because the selection process for a civil law specialization is traditionally stricter.”
