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A record number of top lawyers moved to London this year as the arrival of US law firms in the capital continues to disrupt the market and fuel wage wars for talent.

Law firms hired 546 partners in London over the year to December 23, according to data from law firm Edwards Gibson and shared with the Financial Times. The number surpasses last year’s record of 514 partner moves, as investment from US UK law firms shows no sign of slowing.

The London legal market has experienced significant disruption in recent years as the booming private equity market has driven a significant increase in profits. American law firms In the city. High-income US companies have attracted partners from their UK-headquartered rivals and, increasingly, from their US peers.

UK countries “Magic circle” group of firmswhich includes Linklaters, Freshfields, A&O Shearman and Clifford Chance, are particularly affected, losing a record 28 partners this year, according to data, more than the previous record of 19.

The war for talent has caused changes in firms’ salary structures as they scramble to attract and retain top performers and others. little talent. Groups such as Clifford Chance and America’s Latham & Watkins have recently added more flexibility to their models so they can reward better performers than others, according to people familiar with the moves. Both firms declined to comment.

Scott Gibson, founder of Edwards Gibson, said: “Unprecedented investment by US law firms in private equity practices has pumped millions of dollars into the system. “This is perverse. the market by making compensation stronger and creating more negative effects as upset opponents seek to recover.”

U.S.-based firms Kirkland & Ellis and Paul, Weiss, Rifkind, Wharton & Garrison were among the largest employers in 2024, according to the data, which includes 155 lawyers who left other jobs. of cooperation to partners.

Last year, Paul Weiss sought to to build quickly its presence in London and has grown 10 times across Europe, including by opening an office in Brussels, to cater to US independent clients on the continent.

“Our private and corporate clients are focused on having top legal counsel throughout New York and London,” said Neel Sachdev, co-head of Paul Weiss’ London office. “Many companies are looking to generate growth in London as it is an important legal market for M&A and capital markets and a gateway to Europe.”

Other UK-headquartered companies have also benefited from churn, with larger firms moving out of unprofitable gyms, such as low-quality work for financial services firms.

Simmons & Simmons hired 16 new partners this year, according to the data, making it the second largest hire by 2024.

“The impact of US firms is very important and you see some firms have decided that they are committed to a certain profit motive. This is what drives some of their policies and they are no longer able to give advice. in other markets,” said Jeremy Hoyland, managing partner of Simmons & Simmons.

He added: “Some of the partners we are talking to are not as popular as before.

The hiring frenzy has led to raids by many top outfits; Latham & Watkins and Linklaters saw some of the biggest departures.

Latham has lost eight of its 13 partners to Sidley Austin this year, while Linklaters has also seen a number of trips for US peers. Latham’s London-based managing partner Ed Barnett said the capital “has been a priority for decades” and the firm “had a very strong year”. Linklaters declined to comment.

While not every exit can be considered a loss, the eye-watering pay packages offered to partners were hard to compete with, said Charlie Harvey, founder of law firm Harvey and Partners.

“We have worked with law firm partners in the London market who have doubled or tripled their compensation when moving,” said Harvey. “We don’t see any signs of late partner hiring slowing as we enter 2025.”