Business of law. 1975 vs. 2025: A 50-Year Transformation

• Pages: 30-31
• Date: 01 January 2026
• Published date: 01 January 2026
• Author: Daniel S. Wittenberg
• Subject Matter: Civil Law

Published in Litigation News Volume 51, Num ber 2, Winter 202 6. © 2026 by the Amer ican Bar Ass ociation. Rep roduced with pe rmission. A ll rights reser ved. This info rmation or any po rtion thereof

may not be copied o r disseminated i n any form or by any means o r stored in an elec tronic databas e or retrieval system w ithout the expres s written consen t of the American Ba r Association .

ifty years ago, law was widely regarded as a profes-

sion rooted in tradition, prestige, and collegiality.

Today, it is equally a business—one that operates in

a hyper-competitive, tech-driven marketplace. The

profession has expanded dramatically, matured into a

global-scale business, and evolved under powerful forces—

regulation, economy-wide growth, corporate demand, spe-

cialization, and technology. This column looks at how the

business of law has evolved from 1975 to 2025.

According to the American Bar Association Prof‌ile of the

Legal Profession 2024, the number of lawyers in the United

States surged in the 1970s: from roughly 326,000 in 1970 to

574,000 by 1980—a 76 percent increase over the decade. As

of 2024, there are approximately 1,322,649 active lawyers in

the U.S.Over roughly 50 years, the profession has more than

doubled in size—even leaving aside f‌luctuations and account-

ing for retirements, new admissions, and changing demand.

This has fundamentally altered the business dynamics, compe-

tition levels, and organizational possibilities for law f‌irms.

Law Firms in 1975: A Sn apshot

In 1975, the American legal industry was dominated by

• small to mid-sized f‌irms: Most f‌irms had fewer than 50

lawyers.

• single-tier partnerships: Equity partnership was the ulti-

mate goal; all partners shared prof‌its and risks.

• lockstep compensation: Associates and partners were

paid based on seniority, not performance.

• billable hour dominance: The billable hour was

entrenched as the primary revenue model.

• limited technology: Typewriters, dictation machines,

and physical libraries were standard.

• work culture: Long hours were expected, but the

pace was slower compared to today’s globalized

environment.

Average f‌irst-year associate salary in 1975 was around

$15,000–$20,000 (roughly $90,000 in today’s dollars), and

partners earned well but rarely approached the multimillion-

dollar f‌igures seen in Big Law today.

Law Firms in 2025: A B usiness- First Approach

By 2025, law f‌irms resemble sophisticated corporations:

• global scale: Am Law 100 f‌irms generate billions in rev-

enue; Kirkland & Ellis reported $8.8 billion in 2024.

• multi-tier partnerships: Equity, non-equity, salaried, and

even “super-tier” partners exist, ref‌lecting diverse career

paths.

• performance-based pay: Lockstep is fading; “black box”

systems and merit-based models dominate.

• technology integration: AI-driven tools for research,

document review, and contract analysis are mainstream,

reshaping workf‌lows.

• client-centric pricing: Alternative fee arrangements,

subscription models, and outcome-based billing are

emerging, challenging the billable hour.

Compensat ion: From Modes t Salaries to Mi llion-

Dollar Paydays

According to the National Association for Law Placement 2025

Associate Salary Survey, the overall median f‌irst-year associate

base salary as of January 1, 2025, was $200,000. The median

f‌irst-year salary in f‌irms of 250 or fewer lawyers was $150,000,

while it was $215,000 in f‌irms of more than 700 lawyers.

Among major f‌irms in 2025, non-equity (income)-partner com-

pensation averages were roughly $687,824. Prof‌itability is also

high: The average prof‌it per equity partner in 2025 among Am

Law 100 f‌irms is $3.15 million.

1975

• Associates earned modest salaries, with incremental

raises tied to seniority.

• Partner compensation was relatively egalitarian under

lockstep systems.

• Bonuses were rare and modest.

2025

• First-year associates at the largest law f‌irms earn

approximately a $225,000 base salary, plus bonuses

that can push total compensation above $250,000.

• Senior associates’ salaries in Big Law can exceed

$500,000 annually.

• Top-tier equity partners at the largest law f‌irms report-

edly earn $20–$30 million, rivaling Wall Street

executives.

• Compensation models now include

• formula-based systems (billings, originations).

• hybrid models blending seniority and performance.

• “black box” systems.

Hours Worked: The B illable Hou r’s Grip an d Its

Decline

1975

• Billable hour targets were informal; 1,400–1,600 hours

per year was typical.

• Work-life balance was better, though expectations for

dedication were high.

2025

• BigLaw associates average 1,550–1,950 billable hours

annually, down from the 2021 peak of 1,683 hours, but

still demanding.

• Many lawyers work 60–80 hours per week, especially in

large f‌irms.

1975 vs. 2025: A 50-Year

Transformation

By Daniel S. Witt enberg, Litigation News Associ ate Editor

BUSINESS OF LAW

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