We are still well underpaid and overworked.
Just run the math yourselves, billable hours times your billing rate. Don’t forget to take into account realization (I usually use 70% to be conservative). In most cases, firms are making ~3.5 times our annual salary per client-facing employee (e.g anuual salary of $100,000 means that the firm is grossing and collecting $350,000 in fees from clients directly attributable to your work throughout the year so they profit $250,000 after paying you).
https://news.bloomberglaw.com/financial-accounting/accounting-faces-reckoning-after-years-of-sluggish-pay-growth
Someone has to pay for partner pensions. Also benefits and other overhead usually account for another sizeable chunk in addition to salary. Point well taken, and we all feel underpaid, but this is a for profit business.
Agreed. Just think it would be great if there were more incentives to sell work or make extra money somehow for people who aren’t partners.
As an associate, the market rate at my firm is somewhere around $400/hour. Even with an extremely conservative realization of 60%, that’s $240/hour x 40hrs/week x 50weeks/year = $480k, which is more than 5x my salary…
You’re better to look at average realized rate. Depending upon the market you could be anywhere between 180-240 an hour for audits.
Well how else are they going to pay for ALL the overhead? The enabling areas, trainings, rent, etc…. I am surprised that is all it is.
Chief
Yea I remember when I was an intern they flew everyone across the country to intern training. 2k at kpmg to Florida. Room board flights easily hundreds of thousands of dollars just for training not including laptops equipment etc
There’s a lot more than just staff salary that total fee pays for: IT, insurance, salaries for admins, practice insurance, employer share of FICA, rent, firm professional services, training, etc. There is no cabal of Scrooge McDucks hiding millions of dollars in a vault.