Equity partners on average are compensated significantly higher than non-equity partners. But firms vary in how much of a gap exists between the two groups. It might be tempting to assume that non-equity partners at firms with a large delta between non-equity and equity comp would be worse off relative to their peers at firms with a smaller delta; however, that is not the case. The 10 firms in the 2026 AmLaw 200 with the largest delta pay their non-equity partners $1.24M on average. The 10 firms with the smallest delta pay their non-equity partners $516K on average. Profitability plays a key role: a wide (and potentially frustrating delta) is often what high PEP looks to non-equity partners. But the same economics that stretch the top of the range for equity partners often lift the floor for non-equity partners. Non-equity partners at firms with a larger delta are often better paid today and have more upside ahead of them [for more, see the latest edition of our LinkedIn Newsletter Partner Perspective.]
Partner Hires Outpace Promotions
Law.com examined partner hiring among the AmLaw 200 in 18 U.S. legal markets and found that external partner hiring outpaced internal partner promotions by 42% between 2024 and 2025 (hires: 4,961; promotions: 3,494). Law.com reached the conclusion that "Am Law 200 demand for partner‑level capacity is running ahead of what internal pipelines alone can supply" (Mapping the Partner Pipeline: Where Am Law 200 Firms Buy Talent—and Where They Build It, James Willer, 7/13/26, Law.com Pro).
The phrasing suggests firms are hiring laterals because they need more senior lawyers to service existing work. But much of Am Law 200 partner hiring is not really about capacity in that sense. It is about acquiring revenue: books of business, client relationships, market share. The imbalance between external partner hiring and internal promotions says less about a shortage of promotable internal talent and more about how aggressively firms are using the lateral market to grow.
Law.com notes that markets with more external hires have "more crowded lateral arenas, heightened poaching pressure, and faster compensation escalation." We agree that markets with more lateral partner hires will have a more crowded lateral arena and would likely engender more concern around poaching among firm leadership. We also agree that "market" compensation can escalate more quickly in active lateral markets, since firms often pay a "lateral premium" in order to entice well-established partners to move.
Partner Rates Too Low?
Partner rates in Big Law aren't too high. They're too low. That's the counterintuitive takeaway from our recent conversation with law firm strategist Jae Um. As the former Global Head of Pricing Strategy at Baker McKenzie — where she oversaw $3B in annual revenue across 46 offices — Jae would know. Jae explains that partner rates are artificially held down in order to subsidize inflated rates at the associate level.
And her thesis makes sense: clients want partner-level judgment and expertise. Associates are simply the mechanism firms built to extend and leverage that expertise at scale. Interestingly, AI may present a different mechanism to extend that same expertise going-forward. If it does, the cross-subsidy holding partner rates down loses its rationale - and partner rates likely rise even further. You can hear more from our wide-ranging conversation on the most recent episode of the NALSC Podcast Recruiter Stories.
