Earlier this year, law firm Cravath astonished the industry by significantly raising associate pay, but it soon comes clear that not all associates have been enjoying this bounty equally. As it emerges, the exact location of an associate can significantly affect how far they can stretch their salaries.
The American Lawyer undertook an intense study, analyzing the cost of living in 30 U.S. cities and self-reported salaries of over 1,500 third-year associates to depict where in America an associate’s salary can go the furthest. Taking Manhattan, New York as a starting point, the researchers determined the average compensation in 30 other U.S. cities and then compared this data with the equivalent salary necessary to maintain the lifestyle of a Biglaw third-year associate in Manhattan. Factors for this comparison included housing, food, utilities, transportation, health care, and other goods and services. Such approach allowed the team to calculate the surplus associates could amass in each city after matching the living standards of Manhattan while living on the city’s average Biglaw salary.
American Lawyer’s results were quite revealing, showing that the best cities for Biglaw associates to get the most value out of their salary were as follows:
- Houston, TX: $143,256 surplus
- Charlotte, NC: $136,909 surplus
- Austin, TX: $136,683 surplus
- Hartford, CT: $133,826 surplus
- Baltimore, MD: $132,061 surplus
- Tampa, FL: $130,225 surplus
- Dallas, TX: $128,036 surplus
- Pittsburgh, PA: $127,004 surplus
- Atlanta, GA: $126,587 surplus
- Philadelphia, PA: $124,035 surplus
The full list can be found here.
On the other end of the spectrum, the coastal and big cities proved to be the worst when it comes to cost-effectiveness. Despite offering similar compensation to the more affordable cities like Philadelphia and Dallas, the cities of San Francisco, Washington, DC, Los Angeles, Boston, and Seattle were noted to have significantly higher living costs.
The incentives for associates to explore options beyond the traditional hubs such as New York are thus financial as well as lifestyle-oriented. Texas, Southeast, and Rust Belt regions, with their higher salary values, lower cost of living, and potentially more balanced lifestyles, emerge as appealing alternatives.
Further details can be found in the American Lawyer’s study: Where Do Big Law Associates Live the Largest?