Midwest Salaries and Trends

A Report by The Cowen Group

In part one of our salary survey series (Litigation Support Today, August/October issue), we offered a comprehensive overview of salaries on the East Coast and job descriptions for the litigation support market. In part two (Litigation Support Today, November/January issue) we covered salary ranges and trends on the West Coast and examined the difference between the East and West Coast markets. Part Three of this series will provide the Midwest salary survey results and discuss trends in the litigation support market. 

Survey information was collected through personal and telephone interviews and online questionnaires. 75 Midwest organizations participated in the survey, including law firms, vendors, consultants and Fortune 500 corporations. For purposes of this survey, “Midwest” is defined as the geographic area encompassing states within the Texas, Illinois and Minnesota triangle. Midwest cities included in the survey are: Austin, Chicago, Cleveland, Dallas, Houston, Indianapolis, Kansas City Milwaukee, Minneapolis and St. Louis. 

Midwest Salaries and Trends

The industry is emerging from four years of high demand for litigation support and e-discovery professionals. Although demand may flatten over the next two years, double digit salary growth will likely continue across the nation. In the Midwest, salaries are rising for most positions just as in the coastal regions. 

The median annual salary for litigation support analysts in the Midwest was $55,000 in 2008 while the median specialist income was $75,000. Project managers earned a median income of $90,000; managers earned $140,000; and directors earned $205,000 (see Figure 1).  With the exception of Firm wide Litigation Support Directors, litigation support personnel in the Midwest have experienced double digit salary increases across the board in the last three years (see Figure 2) and a robust 15% salary increase from 2007 to 2008. 

In the Midwest, more paralegals and IT professionals are being pulled into litigation support and e-discovery. In 2008, there was a greater demand for analysts and project managers and professionals are advancing into these positions more rapidly than previous years. Para-technicals (paralegals with technical knowledge and experience) are also in demand due to the technical challenges posed by e-discovery. 

In 2008, the Midwest market caught up with the East and West Coasts in terms of litigation support demand.  Overall, the Midwest market harbors a smaller labor pool than the East and West Coast and there is less movement of talent across firms. The lack of movement between employers translates into less competition and salary growth. 

Midwest law firms often try to keep talent in-house and are more willing to train their own rather than seek outside talent. This provides a greater opportunity for para-technicals to focus on career advancement within their current organization. Due to a smaller pool of vendors, there is also less vendor movement in the Midwest compared to the East and West coasts. 

Regional Staffing Trends

The survey found that the number of Midwest litigation support and e-discovery job opportunities in 2008 quadrupled at every level.  A total of 2,406 individuals were employed in litigation support and e-discovery positions in the Midwest in 2008 (in those cities surveyed), a 15% rise from 2007. Chicago boasted the highest number of litigation support/e-discovery professionals with approximately 529 positions in 2008. Dallas, Houston and Austin followed close behind with roughly 517, 446 and 215 litigation support/e-discovery professionals, respectively.  Milwaukee, St. Louis and Indianapolis employed the fewest professionals with 32, 86 and 90 positions in each city, respectively. 

Staffing trends in the Midwest region vary by state.  In general, Midwest law firms, corporations and vendors are reluctant to recruit litigation support talent from other cities.  In Chicago, professionals tend to stick close to home, but they also to move from firm to firm within their market.  Minnesota firms demonstrate the greatest tendency to keep talent in-house. 

An increased number of Midwest firms, corporate legal departments and vendors prefer to train their own versus hiring from other parts of the country. The exception is Texas because demand for litigation support and e-discovery in that state is far greater than other cities in the Midwest.  Firms in Dallas, Houston and Austin operate much like the East and West Coast; they are willing to pay top dollar and recruit talent from across the nation to run practice support departments (see Figure 3). Due to the growth of the Texas market, litigation support professionals employed by Texas vendors will have the easiest time moving into area law firms or corporate legal departments. While Chicago experienced its greatest growth in 2006 and 2007 and has plenty of talent in place, Texas’s greatest litigation support growth occurred in 2007 and 2008.

Changing Roles in 2009

The roles of litigation support professionals from coast to coast are evolving and the lines of responsibility are blurring. Roles are not as compartmentalized as in the past and each position is becoming more sophisticated. Role responsibilities are spread across the entire lifecycle of litigation support. The roles of the litigation support coordinator and project manager are becoming less technical and more consultative and advisory. Large firms with well-established departments that promote from within and train extensively can provide a fast track for any career. 

The industry has seen four years of high demand for traditional litigation support talent such as analysts, specialists, coordinators and project managers. At the end of 2008, we saw that trend flatten out. A new and important role emerging in this industry is the e-discovery attorney. Fifteen major law firms in the United States presently have national e-discovery counsel and that number is growing.  Thus, litigation support personnel must learn to work alongside e-discovery attorneys. 

As the profession matures, law firms are demanding subject matter experts. A subject matter expert is a litigation support professional with five-plus years experience and knowledge of all three major aspects of litigation support: technology, business and the law.  A subject matter expert understands the business of e-discovery and litigation support and possesses hands-on project management and people management skills.  He/she understands the financial implications of vendor selection and the nuances of the relevant case law. Going forward, litigation support teams will be expected to have business savvy, project management skills, legal knowledge and management experience. Seasoned professionals who can hit the ground running and are subject matter experts will be the most highly valued and compensated in 2009.

Salary Survey Wrap-Up

Although salaries in the East are higher than the West and Midwest, salaries across all three geographic markets are not significantly disparate (see Figure 4).  Generally, salaries in litigation support are not predicated on geography because demand exceeds supply in every market

Our survey results revealed a total of 10,047 litigation support/e-discovery positions in major cities across the United States in 2008.  4,513, or about 45%, of litigation support professionals live and work on the East Coast, representing nearly half of the litigation support performed nationally.  The West Coast boasted 3,128 positions in 2008 (in the cities surveyed), representing approximately 31% of the litigation support market, while Midwestern cities reported a total of 2,406 positions, or approximately 24% of the market (see Figure 5). 

Much of the East Coast work is being driven by banking, financial services and complex litigation originating from Europe.  Since the Am Law 100 firms handle most of this work and since most such firms have a significant East Coast presence, it makes sense that more litigation support and e-discovery work is performed on the East Coast versus the Midwest and West Coast. 

Recession-proof but not bullet-proof

Record numbers of legal professionals lost their jobs in 2008. 1,100 legal jobs were lost in October alone, capping eight consecutive months of decline, according to the U.S. Department of Labor reported. The national unemployment rate rose to 6.7 percent, up two percentage points from a year ago.

Although the legal industry has been affected by the declining economy, it is more recession-proof than other industries. Double digit salary growth for litigation support and e-discovery professionals is still likely in 2009. However, it is important to remember that no position, including that of the litigation support or e-discovery professional is entirely recession proof.  High salaried support staff are always tempting targets for cost cutting managing partners. 

Overall, 2008 was a great time to work in litigation support and 2009 looks equally promising. 

Contributor:  Material for this article was contributed by David Cowen, founder and president of the Cowen Group. He is a subject matter expert in building and staffing critical legal support teams and lectures and writes extensively on “the war for talent.” For more information on The Cowen Group and the Litigation Support market, visit www.opportunityknocksblog.com.