Baker & McKenzie cutting lawyers in China
Baker & McKenzie LLP, the world's second-largest law firm by revenue, plans to eliminate 11 percent of its lawyers and professional staff in China because of the "very challenging" economic climate.
"These difficult measures are necessary to ensure our ongoing financial health in an increasingly competitive environment," the Chicago-based firm said today in an e-mailed statement. A comparable number of secretarial and support staff will be leaving, according to the statement.
Baker didn't say which practices were affected. The firm has more than 350 lawyers and professional staff in Hong Kong, Beijing and Shanghai, according to a separate statement today on the appointment of five partners in the three cities.
International firms including New York-based Proskauer Rose LLP and London-based Ashurst LLP have opened Hong Kong offices in the last 12 months, drawn by a boom in initial share sales by Chinese companies in the city which raised $40 billion a year in 2006 and 2007.
While new share sales collapsed to $7.9 billion last year, bankers and analysts predict a revival this year, with Goldman Sachs Group Inc. saying as many as 100 companies may be reviving sales plans postponed during the 2008 equities rout. The accounting firm Ernst & Young LLP has said as much as $39 billion may be raised in Hong Kong and China in 2009.
Firms including Chicago-based DLA Piper LLP cut lawyers and staff in Asia in the first half of this year and most of the region's legal job cuts were thought to be over, according to Jacqueline Keddie, a Singapore-based managing consultant at legal recruitment firm Law Alliance.
"The market isn't so robust that anyone can guarantee there will be no further retrenchments," she said.
The dismissals at Baker are at least the firm's third round of job cuts globally this year.
"The current economic climate is proving very challenging for most businesses, including many of our clients," Baker said in its statement. "It is difficult to predict the timing and pace of the recovery of the markets in which we operate in Asia."