Scotland's elite solicitors have seen their pay almost treble in the last seven years amid booming demand for commercial legal advice.
A typical profit-sharing partner at one of the leading firms banked £223,000 last year, fully £90,000 more than in 2005. This compares with a return of just £87,000 in 2000, according to the only official survey of Scottish lawyers' profits.
The figures, published this week, were reported by firms with 10 or more profit-sharing partners. Many in this bracket actually pocketed much more, since the numbers relate only to "median" profit share. Half earned more than the median and half earned less.
Small high street solicitors, by contrast, appear to have seen their earnings stall. Firms with two to four partners saw a decline in profits per partner from £91,000 to £83,000, a sum which is nevertheless far ahead of an equivalent figure of £53,000 for the same sector back in 2001. For mid-sized firms of five to nine partners, profits were flat at £93,000 in 2006.
Soaring earnings at the largest firms, including central belt "heavyweights" such as McGrigors and Dundas & Wilson, are linked to the general upturn in business confidence. The performance of the big commercial practices tends to mirror that of the wider economy. Profits dipped at the turn of the decade and then remained static in 2002, as the stock market slump and a dearth of corporate deals cut fees for transaction-related work.
Another factor underlying the upturn in solicitors' pay has been Scotland's run- away housing market, which has boosted estate agency commissions.
The 2006 "cost of time" survey of law firms is an annual study commissioned by the Law Society of Scotland.
Though the legal sector is undoubtedly in rude health, the society cautioned that the annual figures are subject to volatility depending on the number and profile of the firms who respond.
The 2006 report states: "It should be remembered that this (10+partner) category potentially covers an enormous range from firms with perhaps 15 to 20 fee earners in total to the largest commercial firms."
So-called "gearing", or "leverage" is also critical. The more profitable firms will have a smaller number of profit-sharing partners as a proportion of total fee earners. They also maintain a low ratio of salary costs to total fee income. The firms that tend to combine these factors most effectively are the larger practices in Edinburgh and Glasgow.
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