Law Firm Growth Report: Q1 Revenue, Hiring Trends, and What's Shaping Big Law
New survey results from Citi Global Wealth at Work Law Firm Group show that U.S. law firms had a strong start to 2026 despite ongoing geopolitical tensions, rising energy prices, and tariff concerns. First-quarter revenue increased 11.2% year over year, driven by a 3.3% rise in demand and strong transactional activity, particularly in technology and healthcare sectors. Firms also saw growth in major dealmaking and inventory collections, though expenses rose 9% due to higher compensation, technology investments, and real estate costs. While industry leaders remain optimistic about continued momentum, some firms reported signs of slowing demand toward the end of the quarter amid broader economic uncertainty.
MARKET MOVEMENTS
A fifth Wachtell partner, Erica Aho, moves to Latham & Watkins
Proskauer Rose LLP welcomes two new partners, Josh Sturm and Josh Frankel, to NY office
Latham & Watkins adds litigation pro, Carson Young, in Houston from Kirkland
K&L Gates tax trio, Sam Megally, Will LeDoux and Cindy Ohlenforst, joins Holland & Knight LLP in Dallas
FIRM SPOTLIGHT - PRYOR CASHMAN LLP
Founded in 1963 as an entertainment law boutique, Pryor Cashman has grown into a full-service midsize firm with offices in New York, Los Angeles, and Miami. While best known for representing major entertainment icons like Lady Gaga, Elton John, and Bob Dylan, the firm has expanded its practices to include corporate, litigation, intellectual property, real estate, employment, and more. Pryor has earned recognition from organizations like Chambers and Partners and Legal 500, while also handling notable matters such as profit-sharing deals for Hamilton cast members and landmark music streaming royalty cases.
INDUSTRY INSIGHTS
Based on a Law360 Pulse 2026 Summer Associates Survey, the following firms are where students dream of working: Kirkland & Ellis, Latham & Watkins, Morgan, Lewis & Bockius LLP, Perkins Coie, Covington & Burling LLP, Jones Day, Cooley LLP, Haynes and Boone, LLP, Sidley Austin LLP, Troutman Pepper Locke LLP, Husch Blackwell, Norton Rose Fulbright, King & Spalding, Polsinelli and Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates
Among the Q1 factors slowing down the legal market are slower demand increases for midsize firms, an increase in overhead expenses (8.3%), a contraction in productivity (-0.7%), and the war in Iran, which analysts say has blunted both dealmaking and restructuring
Nearly 56% of all law school graduates from the class of 2025 are employed by law firms of any size, up from 54.4% in 2024, according to the ABA data
U.S. Bureau of Labor Statistics data show that the share of lawyers 65 and older rose steadily to 15.2% in 2019, but reversed course in 2020 and fell to 12.6% in 2021, a loss of more than 50,000 attorneys from the pre-pandemic peak. And although the cohort climbed back to 14.1%, or 162,000, in 2025, it has yet to match the 188,000 senior lawyers recorded before 2020
Littler Names First-Ever Wellness Executive Amid Rising Mental Health Needs
Littler has appointed Denver-based shareholder Michelle Gomez as its first Executive Director of Wellness, Engagement and Development, a newly created role focused on supporting employees’ mental, physical, and emotional well-being. Gomez, who has been open about her personal health journey following the loss of her husband in 2019, will lead firmwide wellness initiatives, onboarding programs, and team development efforts. Her appointment comes as employers increasingly address workplace mental health challenges, with Littler’s 2026 Employer Survey finding that nearly 70% of employers saw an increase in mental health-related leave and accommodation requests over the past year.
Big Law’s Real Estate Talent War Heats Up
Big Law firms are aggressively competing for top real estate talent in 2026 as demand surges for data center, AI, and real estate finance work. Firms like Kirkland & Ellis and Cooley LLP have merged their real estate and energy teams to capitalize on growing infrastructure and AI-related projects, while firms including Latham & Watkins, Jones Day, and Mayer Brown continue adding high-profile lateral partners. Industrywide real estate demand rose 2.6% in Q1 2026, fueled by data center transactions, private credit activity, litigation, and increased stability in interest rates, all of which are driving firms to expand their capabilities and aggressively recruit experienced attorneys.
