When
Baker
McKenzie
announced
plans
to
cut
roughly
700
business
services
staff,
the
firm
pegged
some
of
the
blame
squarely
on
AI,
feeding
into
the
technology-fueled
paranoia
surrounding
artificial
intelligence.
It
certainly
doesn’t
help
that
the
AI
hype
cycle
turns
on
tech
gurus
juicing
up
their
VC
sugar
daddies
with
promises
that
AI
will
replace
human
workers
any
moment
now,
even
though
AI
agents
can’t
reliably
do
much
more
than
accidentally
delete
a
whole
computer
and
then
apologize
for
it.
I
don’t
know
if
Baker
McKenzie
really
believes
it
can
replace
700
staff
with
AI
or
if
blaming
the
bots
just
provides
a
convenient
excuse
for
general
management
missteps,
but
either
way
it’s
not
a
great
sign
for
the
remaining
team.
And,
of
course,
the
headlines
naturally
raise
attorney
anxiety
as
lawyers
wonder
if
they’re
about
to
be
replaced.
The
short
answer
is
that
AI
isn’t
replacing
Biglaw
lawyers.
The
long
answer
is
that
it
might
depend
on
which
Biglaw
firm
we’re
talking
about.
While
the
developers
hustling
for
VC
cash
to
heap
upon
the
AI
furnace
will
tell
you
that
“agentic”
AI
is
new
and
revolutionary,
the
reality
is
that
agents
are
still
stumbling
with
multi-stage
tasks
and
the
more
people
try
to
aim
them
at
higher-level
thinking,
the
more
time
the
“human
in
the
loop”
spends
fixing
the
mistakes
generated
along
the
way.
That’s
not
to
say
AI
isn’t
radically
changing
business
workflows
—
including
legal
—
but
it’s
not
building
robot
lawyers.
Hell,
it’s
hemorrhaging
money
to
make
the
technology
hallucinate
1
percent
less.
As
bots
go,
AI
is
charting
a
sci-fi
future
path
closer
to
Star
Wars.
He’s
cute
and
personable
and
can
perform
a
lot
of
useful
technical
tasks,
but
R2D2
is
more
or
less
defeated
by
a
flight
of
stairs.
These
AI
tools
will
accelerate
your
summaries
and
timelines,
but
pump
the
brakes
before
handing
it
a
case
file
and
turning
it
loose.
In
this
way,
AI
doesn’t
replace
lawyers,
it
improves
attorney
efficiency
significantly
enough
that
the
firm
doesn’t
need
as
many
lawyers
to
produce
the
same
results.
That
won’t
feel
any
different
than
“replacement”
for
the
lawyers
on
the
wrong
end
of
that
equation,
but
it’s
still
a
useful
distinction.
Law
firms
shaving
a
few
percent
off
their
associate
hiring
is
not
the
same
as
the
cataclysmic
human
layoffs
that
tech
futurists
warn
about.
Or,
more
accurately,
that
they
entice
their
deeply
anti-humanist
investors
with.
Either
way,
AI
will
impact
hiring
at
the
margins.
Mostly.
Now
come
the
caveats.
Adopting
AI
isn’t
going
to
replace
scores
of
lawyers
and
spark
Biglaw
layoffs,
but
in-house
and
small
firm
adoption
might.
Clients
continue
to
deal
with
mounting
budgetary
pressure.
If
AI
allows
a
deputy
GC
to
handle
the
matter
entirely
in-house
as
opposed
to
forking
over
Biglaw
rates,
that’s
a
gold
star
from
the
board.
Even
if
the
job
can’t
be
entirely
ported
in-house,
if
smaller
firms
—
at
a
lower
price
point
than
Biglaw
—
can
use
AI
to
give
their
handful
of
lawyers
the
brute
force
power
of
a
large
law
firm,
they’ll
drink
some
of
that
Biglaw
milkshake.
And
that
is
where
Biglaw
lawyers
stand
to
get
laid
off.
Not
from
the
internal
automation,
but
from
the
fleeing
revenue.
But
this
fate
won’t
strike
all
firms
equally.
There
are
essentially
two
kinds
of
firms
sitting
at
the
top
of
the
Am
Law
100.
On
one
side,
you’ve
got
decently
large
firms
doing
incredibly
lucrative,
high-margin
work.
These
are
your
Wachtells,
your
Cravaths,
your
Davis
Polks.
These
firms
boast
hundreds
of
attorneys
generating
massive
revenue
per
lawyer.
Wachtell’s
RPL
clocked
in
at
$4.47
million
on
the
most
recent
Am
Law
100.
It’s
a
business
model
built
on
capturing
valuable
work
from
clients
ready
to
spend
big
for
it.
On
the
other
side,
you’ve
got
the
megafirms.
This
is
where
you’d
find
a
firm
like
Baker
McKenzie.
The
firm’s
sitting
at
No.
9
on
the
Global
200
with
an
impressive
$3.4
billion
in
revenue.
But
it’s
spread
across
roughly
4,500
lawyers,
yielding
an
RPL
somewhere
around
$721,000.
DLA
Piper,
Dentons,
the
various
Verein
Voltrons.
These
are
firms
raking
in
revenue
by
stationing
an
office
on
every
continent
and
leaning
on
offering
clients
expertise
all
over
the
place.
And
generating
revenue
from
volume.
One
model
has
a
lot
more
exposure
to
AI.
The
high-RPL
firms
have
clients
who
already
decided
they’d
rather
pay
big
bucks
than
shop
for
a
deal.
It’s
not
work
a
client
is
eager
to
take
on
themselves.
If
AI
speeds
up
the
process,
the
firm
is
still
going
to
collect
its
fees.
These
are
the
firms
that
will
trim
their
future
offers
but
aren’t
about
to
purge
lawyers.
On
the
other
hand,
when
a
business
model
is
based
around
size
and
volume,
efficiency
takes
a
toll.
When
you’ve
built
a
$3.4
billion
business
on
the
premise
that
clients
need
4,500
lawyers
scattered
across
70
offices
to
handle
cross-border
compliance,
due
diligence,
and
regulatory
work
at
volume,
the
math
gets
ugly
fast
when
technology
lets
a
team
of
50
handle
what
used
to
require
150.
If
AI
makes
lawyers
more
efficient,
that
$721K
RPL
isn’t
going
to
cut
it
for
a
lot
of
those
lawyers.
Which
should
give
some
pause
to
all
the
firms
scrambling
to
merge
their
way
up
the
revenue
charts.
But
these
headcount-and-geography
mergers
rest
on
the
same
volume-dependent
operation
that
AI
threatens
to
hollow
out.
Not
every
merger
is
doomed,
of
course.
Combinations
can
bring
together
complementary
high-value
practices.
But
when
a
pair
of
second-50
firms
joins
to
create
a
behemoth
that
suddenly
moves
them
into
the
top-25…
that’s
begging
for
a
“harder
they
fall”
narrative.
The
Baker
McKenzie
layoffs
this
week
didn’t
involve
lawyers,
but
we
received
tips
over
the
last
few
days
suggesting
a
number
of
junior
associates
were
let
go
for
non-performance
reasons.
When
a
firm
says
it’s
“rethinking
the
ways
in
which
we
work,
including
through
our
use
of
AI,”
that
doesn’t
sound
like
they’re
sure
they’re
finished
making
changes.
But
even
as
the
megafirms
consider
their
exposure
to
AI
advancements,
it’s
worth
considering
the
Salesforce
experience.
No
company
invested
more
in
the
agentic
AI
hype
than
Salesforce
and
they
laid
off
swaths
of
employees
accordingly.
By
the
end
of
2025,
their
own
studies
determined
their
agents
mostly
failed
and
reports
surfaced
that
senior
executives
at
Salesforce
determined
that
they
had
“massively
overestimated
AI’s
capabilities.”
The
risk
isn’t
that
AI
is
competent
enough
to
replace
lawyers,
but
that
there’s
a
lot
of
hype
out
there
fooling
people
into
believing
that
it
is.
When
that
sci-fi
mythologizing
collides
with
the
genuine
risks
AI
presents
to
a
volume-based
business
model,
firms
are
going
to
make
some
overestimations
that
unnecessarily
cost
a
lot
of
people
their
jobs.
Joe
Patrice is
a
senior
editor
at
Above
the
Law
and
co-host
of
Thinking
Like
A
Lawyer.
Feel
free
to email
any
tips,
questions,
or
comments.
Follow
him
on Twitter or
Bluesky
if
you’re
interested
in
law,
politics,
and
a
healthy
dose
of
college
sports
news.
Joe
also
serves
as
a
Managing
Director
at
RPN
Executive
Search.