The average cost of outside counsel is up about 7% from two years ago, data from the 2022 Real Rate Report by Wolters Kluwer ELM Solutions shows.
The hourly rate on a national average basis is $749 for a partner, $546 for an associate and $247 for a paralegal. The rates are up between 6.2% and 8.5% from two years ago.
The percentage increases don’t take into account factors such as timekeepers who left the profession or otherwise stopped billing, which can depress the average rate charged by that class of timekeeper, Wolters Kluwer ELM Solutions says.
Firm location and size, attorney experience, practice area and industry specialty all influence how much a firm charges.
The differences are stark when you compare the typical hourly rate of a New York City partner, $1,189, with the rate of a partner in another metro area, like Phoenix, where the typical rate is $470 – a 153% differential.
“Value is in the eye of the beholder,” John O’Connor, a San Francisco-based specialist on legal fees, told Bloomberg Law. “The perceived value of a good lawyer can reach into the multi-billions of dollars.”
Wolters Kluwer ELM Solutions builds its rate report based on $155 billion in billing amounts that the company has tabulated since 2010.
As law firms check off the boxes – size, location and so on – the hourly rate rises.
For a partner in a law firm with 1,000 or more attorneys, for example, expect to pay $1,113 an hour on a national mean basis, compared to $424 for a partner in a firm with fewer than 50 lawyers.
If the partner specializes in antitrust, one of the highest paid specialty areas, expect to pay $1,182 an hour, compared to $591 for a typical employment or labor matter.
Intellectual property is another high-cost specialty area. A licensing specialist can cost $1,083 an hour.
As a general matter, non-litigation partners tend to charge more than litigation partners, but that can change based on the matter being litigated.
The hourly rate in New York City for a partner on a non-litigation matter is $1,189 compared to $808 for a litigation partner.
This is typical across the board. In Omaha, Neb., for example, a non-litigation partner will typically charge $460 an hour, compared to $329 for a litigation partner.
But when an intellectual property matter is being litigated, the partner commands a premium, $865 an hour on a national average basis, compared to $616 when the matter doesn’t involve litigation.
The 235-page report tracks hourly rates for partners, associates and paralegals in the 80 largest metro areas, with additional tabulations by specialty area, years of experience and size of law firms. Some international data is compiled, too.