The outlook provided by both employers and legal recruitment agencies is not so positive for legal job seekers in China. Unlike in the past few years, when employment opportunities for legal professionals was plentiful, 2009 will see a continuing reduction in legal recruiting opportunities as the global economy slows.

Except for a few newcomers to the market from the US and the UK, existing foreign and even local law firms will continue cost-cutting measures to avoid redundancies and trim their teams in China to the right size, said Xia, founder and managing director of DaCare Legal Career.

According to Xia, a wait-and-see mentality will characterise the job market, at least for the first quarter of 2009. Capital markets and real estate attorneys will either be let go or redeployed to working on M&A or even FDI deals. Attorneys in the M&A and private equity practice areas should not worry too much about losing jobs, although PricewaterhouseCoopers latest report has revealed that the number of M&A deals in the Mainland have almost halved compared to the same period in 2007. The safest practice areas are expected to include employment, litigation, distressed assets, restructuring and bankruptcy.

A managing partner of a well-established international firm in Beijing, who did not wish to be identified, confirmed Xias prediction. He noted that a number of international firms in China have laid off legal staff in the past few months and around 80% of the international law firms here are currently experiencing a relatively quite time.

One of the reasons for the rising number of job casualties was the aggressive expansion of some firms who hired a large number of lawyers from local law firms earlier this year. Many leading local firms told ALB that they would slow down on recruitment plans, but would not stop taking on good talent.

Nevertheless, there remains some good news for employers with a budget and partners who are looking to move.

Some clients are taking advantage of this special market situation to upgrade their team so with the same budget they can now put a better team together, said Xia. Another interesting phenomenon is that partner search, contrary to common understanding, is thought to become more active, especially for those who carry a book of business.

The in-house side will also see a similar pattern and outlook. The financial crisis will trickle along the food chain, slowing down many industries including auto, shipping and hi-tech. Some in-house openings will become available, especially for mid- to senior-level counsels with a high degree of independence. The market will further concentrate on hiring more local talent, partly as a cost reduction effort, partly for being more effective.

One uncertainty, though, is to what extent multinational companies will turn to the China market for a solution when their home markets are experiencing serious trouble. Its very likely that many MNCs will come to this market, as a better option. General counsel will need to be better prepared for more hands-on work when application for headcount in 2009 will be frustrating and excruciating, said Xia.

In the light of salary trends in 2009, it will be unrealistic to expect any salary hike. Xia suggested that job candidates will set their eyes more on guaranteed payment, rather on target bonus or long-term incentives where the company performance part of salaries is a big question mark.

Candidates will be more cautious when switching jobs, though some will actively look for a change if they are in a precarious industry, Xia said.