By RENEE MCGAW
Denver Business Journal

Law firms likely will begin hiring cautiously in 2010, as the industry slowly recovers from a year that's widely considered to have been the worst in decades.

"The hiring situation is definitely looking much more positive than it was in January 2009," said Mala Saraogi, director of placement services in Denver for Robert Half Legal, the legal-staffing division of Robert Half International. "The economy is showing some nascent signs of recovery. Although law firms and legal departments are taking a cautious approach to adding staff, they're definitely considering it. They're leaning toward contract staffing just because they're waiting for consistency in business ... but when they see more consistency, they'll be more amenable to direct hires."

Last year will be remembered as the worst year ever for law-firm layoffs, according to Law Shucks, which tracks legal-industry layoffs on its Web site, lawshucks.com.

At least 12,196 people were laid off from major U.S. law firms in 2009, including 4,633 lawyers, according to Law Shucks' analysis - and that's probably a low estimate, as law firms rarely report layoffs publicly. About 73 percent of the layoffs occurred in the first three months of the year, and 88 percent were done by July. Job cuts reached their lowest point of the year in December.

Meanwhile, the National Law Journal reported in November that 2009 was the worst year for lawyer headcount in three decades. The number of attorneys working at the nation's top 250 law firms fell by 5,259 in 2009, a 4 percent drop.

It was only the third time since the newspaper began tracking layoffs in 1978 that lawyer headcount fell at those firms. It was also the largest decline, far surpassing a 0.9 percent dip in 1993 and a 1 percent drop in 1992.

Some practice areas already are experiencing increased demand, including corporate litigation and transactions, bankruptcy, regulatory and compliance, according to Robert Half Legal's 2010 Salary Guide.

The growing health-care industry is seeking attorneys and paralegals with biotechnology and pharmaceutical experience, and corporations are bringing in more in-house professionals, Saraogi said.