May 2026 marks a notable inflection point in the Q2 lateral market. After three consecutive months of broad-based net attrition, with February and March each exceeding -590 in net outflow and April improving to -351, May narrows the deficit further and shows a pronounced broadening of positive practice area performance. Labor & Employment, Trusts & Estates, Insurance, Banking, Immigration, and Government all post net gains, while Corporate and Litigation continue their structural correction. The data increasingly supports a bifurcated market thesis: practice areas tied to regulatory complexity, wealth transfer, and employment are growing their Am Law 200 footprint, while those over-staffed from the 2023–2024 hiring surge continue to rationalize.
Corporate’s net attrition of -42 is a dramatic improvement from March’s -193 and April’s -186, potentially signaling that the corporate correction is beginning to moderate. Litigation’s net of -149 is essentially flat month-over-month. The story of May is not the negatives holding steady, it is the breadth and depth of the positives strengthening across specialty practice areas.
Practice Area Analysis
Litigation — 477 Entries | 626 Exits | Net: -149
Litigation remains the single largest practice area by raw volume in May, recording 477 entries and 626 exits for a net of -149. This is nearly flat with April’s -143 and well within the range observed throughout Q1 and Q2. While total volume has remained consistently high, the absence of meaningful improvement in the net figure, even as other practice areas have turned positive, suggests that the forces driving Litigation attrition are structural rather than cyclical.
Partner movement is the most critical data point: 105 entries against 145 exits, a net of -40 at the partner level. Sustained partner attrition at this scale indicates that revenue-generation mismatches between Litigation partners and their platforms remain unresolved. The associate component (291 in, 417 out) reflects an ongoing migration to plaintiffs’ firms, boutiques, government, and in-house legal departments. The inbound associate number (291) is actually healthy, demonstrating that Litigation is still attracting talent, it is simply not retaining it.
Litigators considering a lateral move should understand they are operating in one of the market’s most active but competitive spaces. Differentiation matters: white-collar, securities, complex commercial, and appellate practices see the strongest demand. Generalist litigators at saturated seniority levels face the most friction.
Corporate — 297 Entries | 339 Exits | Net: -42
Corporate posted 297 entries and 339 exits in May (net -42), a dramatic improvement from April’s -186 and March’s -193. If this moderation holds, May 2026 may mark the beginning of the end of the Corporate correction that has defined the first half of the year. The improvement is broad-based: associate exits dropped from 321 in April to 249, partner exits fell from 89 to 59, and counsel exits declined from 30 to 31 (essentially flat).
The inbound side also improved meaningfully: 208 associate entries, 62 partner entries, and 27 counsel entries all represent healthier inflow numbers than the prior two months. Whether this represents seasonal normalization (May historically sees some post-deal-close mobility settle) or a genuine market correction is the key question heading into June. Corporate partners with portable private equity, M&A, or capital markets business remain in strong demand, and the firms that are winning lateral Corporate partner hires in May are those with demonstrably stronger deal pipelines than the departing firm.
Banking — 83 Entries | 77 Exits | Net: +6
Banking posted a net gain of +6 in May (83 entries, 77 exits), returning to positive territory after April’s net of -18. The partner segment leads: 14 entries against 10 exits, a net of +4, suggesting active senior-level investment in banking practices. Banking & Finance attorneys with acquisition finance, private credit, and structured finance experience remain among the most sought-after lateral profiles in BigLaw, and the May data confirms that firms are actively competing for this talent. Associates also moved positively (61 in, 60 out), a near-perfect balance that reflects the steady-state rotation characteristic of a mature and stable practice area.
Labor & Employment — 134 Entries | 100 Exits | Net: +34
Labor & Employment is May’s standout performer for the second consecutive month, recording 134 entries against 100 exits for a net gain of +34, matching April’s positive result exactly. Two consecutive months of +34 net gain is a signal that cannot be dismissed as seasonal variation. L&E has become the lateral market’s clearest growth story in Q2 2026.
The counsel segment is particularly telling: 33 entries against 16 exits, net +17. Firms are investing in experienced L&E specialists at the mid-to-senior level, not just cycling associates. The drivers are well-established and continuing: non-compete and trade secret litigation volume is high, AI-related employment policy work is accelerating, NLRB activity is generating significant client demand, and the complexity of managing large workforces under evolving legal requirements is creating sustained advisory demand. For L&E attorneys, the message is clear: this is one of the best lateral markets of the decade for your practice area, and the window is open.
Intellectual Property — 90 Entries | 103 Exits | Net: -13
IP posted 90 entries and 103 exits (net -13), essentially identical to April’s -13. The practice area has settled into a modest but persistent deficit that reflects the competing forces of strong demand from BigLaw and equally strong pull from IP boutiques, technology companies, and the USPTO/PTAB for senior practitioners. Partner attrition (33 exits, 27 entries, net -6) is the primary concern. IP partners with portable practices have abundant platform options and are exercising them.
The AI and technology IP space continues to be the hottest sub-market within the practice area. Attorneys with prosecution or litigation experience tied to software, semiconductor, or life sciences patent portfolios remain in acute demand. The 2025 national data showing Cybersecurity and Data Protection as the fastest-growing Am Law 200 practice area (19% partner headcount growth from 2022–2025) is being reflected in the active IP lateral market. Firms are investing in this capability even as the broader IP net runs slightly negative.
Real Estate — 102 Entries | 99 Exits | Net: +3
Real Estate posts a net gain of +3 for the second consecutive month (matching April’s +3), signaling genuine stabilization after Q1’s persistent attrition. The partner inflow (34 entries, 21 exits, net +13) is the most important feature of the data. Firms are investing at the partner level in Real Estate for the second straight month, suggesting confidence in specific asset class demand, such as data centers, industrial logistics, life sciences facilities, and multifamily development, even as the broader commercial market remains mixed.
Associate exits remain elevated (66 out, 46 in), a pattern consistent with mid-level Real Estate associates evaluating platforms and opportunities following a quieter transactional market. Attorneys with data center or technology infrastructure transaction experience are commanding premium attention and compensation in the current market.
Bankruptcy — 23 Entries | 28 Exits | Net: -5
Bankruptcy posted a moderate net deficit of -5 in May (23 entries, 28 exits), a slight deterioration from April’s near-balanced +2. Partner movement is essentially flat (10 entries, 10 exits), and the deficit is driven by the associate level (9 in, 17 out). The practice area is navigating a nuanced environment: while the macro economy has not produced the deep recession that would generate peak restructuring demand, there is meaningful middle-market and healthcare-sector distress that keeps Bankruptcy practices active. Attorneys with Chapter 11 and out-of-court workout experience, particularly in healthcare or retail, remain in demand on both the creditor and debtor sides.
Tax — 41 Entries | 36 Exits | Net: +5
Tax posts a net gain of +5 for the second consecutive month, extending the reversal from Q1’s persistent attrition (-25 in March, -17 in April before turning positive). Partner movement is positive (14 entries, 10 exits, net +4), suggesting senior-level investment in Tax practices. The post-filing-season mobility window that typically drives May activity in Tax appears to be in full effect. International tax, fund formation tax, partnership tax, and M&A tax remain the most sought-after subspecialties, with meaningful competition from Big Four accounting firms keeping pressure on BigLaw to maintain competitive economics for this talent profile.
Healthcare — 22 Entries | 33 Exits | Net: -11
Healthcare has now posted net negative movement in every month of 2026. May’s net of -11 is consistent with April’s -14. The extreme Q1 attrition has moderated but the structural correction continues. The cumulative 2026 net outflow across the tracked months now exceeds -65 attorneys, a meaningful erosion of BigLaw healthcare talent.
The associate level remains the source of most attrition (16 exits, 6 entries, net -10), while the partner segment shows modest improvement (9 entries, 13 exits, net -4, better than prior months). Healthcare attorneys at the associate and mid-level should be thinking proactively about their trajectories. The most competitive profiles remain regulatory specialists with CMS, FDA, digital health, or value-based care expertise. Healthcare transaction attorneys who can flex into health tech deals and digital health M&A are well-positioned across both BigLaw and boutique platforms.
ERISA-C&B — 26 Entries | 36 Exits | Net: -10
ERISA and Compensation & Benefits posted 26 entries and 36 exits (net -10), continuing the persistent attrition observed across the year (-15 in March, -13 in April). The pattern is clear and structural: ERISA practitioners migrate steadily to in-house positions at financial institutions, insurance companies, and benefit plan sponsors. As BigLaw firms optimize their specialty practices around revenue generation, ERISA is a recurring area of rationalization. ERISA attorneys evaluating their options should weigh the institutional in-house market seriously; the demand for this expertise outside Am Law 200 firms is strong and compensation is competitive.
Government — 19 Entries | 16 Exits | Net: +3
Government posts a net gain of +3 for the second consecutive month, extending the positive trend that has persisted throughout all of 2026. The ongoing wave of DOJ, U.S. Attorney’s Office, SEC, and FTC alumni entering private practice continues to be a defining structural story of the current market cycle. Counsel-level inflow (4 entries, 2 exits) and near-balanced partner movement (7 entries, 8 exits) confirm this remains a senior-practitioner story rather than an associate pipeline phenomenon.
For current government attorneys considering private practice: conditions remain historically favorable, and the competition among BigLaw firms for government-background talent is intense. White-collar, national security, and regulatory practices are the primary destinations. Attorneys who have been delaying their transition should be aware that as the initial wave of agency departures normalizes over the next 12–18 months, the premium for government background will begin to compress.
Trusts & Estates — 30 Entries | 16 Exits | Net: +14
Trusts & Estates posts a net gain of +14 in May, its second strongest performance of the year and consistent with April’s +14. Two consecutive months of strong net positive movement in T&E reflects genuine and sustained demand. The ongoing intergenerational wealth transfer, the largest in U.S. history, is driving BigLaw investment in high-net-worth estate planning and trust administration. Attorneys with ultra-high-net-worth estate planning, trust administration, family office advisory, and charitable giving expertise are in real demand at the senior level. The data suggests firms are actively building out T&E practices, not just backfilling departures.
Insurance — 19 Entries | 12 Exits | Net: +7
Insurance continues its positive run from April, posting 19 entries and 12 exits for a net gain of +7. The partner segment (5 entries, 1 exit, net +4) is the highlight, senior-level insurance hiring is outperforming exits for the second consecutive month. Insurance coverage, complex insurance litigation, and specialty lines work remain consistent demand areas, and the practice area’s stability makes it one of the more reliable lateral markets for attorneys who are well-positioned within it.
Immigration — 11 Entries | 6 Exits | Net: +5
Immigration posts a net gain of +5 in May (11 entries, 6 exits), consistent with April’s +5 and continuing a positive trend. Corporate immigration and compliance work is seeing elevated demand driven by federal immigration policy shifts, the compliance burden on large corporate employers navigating visa uncertainty, and the complexity of workforce planning across multinational organizations. Immigration attorneys with robust corporate practice backgrounds are among the more quietly in-demand profiles in the 2026 lateral market.
Energy — 26 Entries | 29 Exits | Net: -3
Energy records a modest net deficit of -3 (26 entries, 29 exits), essentially flat with April’s -3. Partner movement (9 entries, 11 exits) is near-balanced. The practice area continues to reflect a two-speed dynamic: traditional oil and gas transactional work remains soft in several markets, while energy transition work, such as renewables project development, battery storage, transmission infrastructure, carbon markets, continues to generate strong demand. Energy attorneys should have a clear view of which side of this divide their practice sits on, as the market dynamics are meaningfully different.
Information Technology — 16 Entries | 16 Exits | Net: 0
Information Technology achieves perfect equilibrium in May, the same result as March. The strong partner inflow (4 entries, 1 exit, net +3) against associate exits (12 out, 10 in) reflects the ongoing dynamic: BigLaw is successfully recruiting senior IT/AI/data privacy talent while losing mid-level practitioners to in-house technology roles. Firms that are building genuine AI and data privacy practices with platform depth — not just rebranded practice group names — are winning the senior talent competition. The associate churn is unlikely to resolve until BigLaw compensation structures for technology-adjacent attorneys become more competitive with technology company in-house rates.
Month Over Month Comparison
The Q2 2026 trajectory tells a clear and increasingly compelling story. February and March defined a period of maximum attrition (net outflows of -616 and -594 respectively) driven by post-fiscal-year mobility, structural over-capacity in Corporate and Litigation, and the continuing migration of specialty practitioners to boutiques and in-house roles. April marked a genuine turning point: net attrition compressed to -351, and the first wave of practice areas turned positive. May deepens and broadens that improvement.
With a net of -146 across all 22 practice areas, May represents the best monthly net flow figure of 2026 to date. More significant than the headline number is the composition: six practice areas post net gains of +3 or better (Labor & Employment +34, Trusts & Estates +14, Insurance +7, Banking +6, Tax +5, Immigration +5, Government +3, Real Estate +3), while the two largest negative categories, Litigation (-149) and Corporate (-42), are both holding steady or improving. Corporate’s move from -186 in April to -42 in May is the most significant single data point in the month, and if it signals genuine moderation of the correction rather than a seasonal dip, the market aggregate for Q3 2026 could approach near-equilibrium for the first time since 2024.
Compared to the 2025 full-year benchmark, during which lateral hiring increased approximately 15% from 2024, reaching its highest level since the 2021–2022 post-pandemic surge, the 2026 data reflects a market that underwent a sharp Q1 correction and is now stabilizing. The structural shifts that defined 2025 (Government pipeline growth, IP and tech practice investment, L&E expansion) are continuing and intensifying in 2026 as the correction in Corporate and Litigation works through the system.
Mid-Year 2026 Outlook
The May 2026 data positions the Am Law 200 lateral market at a genuine inflection point heading into the second half of the year. Corporate’s moderation from -186 to -42 is the single most important variable to watch in June and July: if that improvement is sustained, the market aggregate could approach near-equilibrium by Q3 for the first time since 2024. If Corporate reverts to deep negative territory, the structural correction has further to run.
The practice areas posting consistent positive performance (Labor & Employment, Trusts & Estates, Insurance, Government, Immigration, Tax) share a common characteristic: they are all driven by structural demand forces that are intensifying rather than cyclical forces that will normalize. These are multi-year tailwinds. Attorneys in these practice areas who have not yet engaged the lateral market are leaving leverage on the table.
For the lateral market overall, the second half of 2026 will be shaped by three variables: the pace of M&A recovery at the Am Law 100–200 level (which determines Corporate stabilization), the continued flow of government attorneys into private practice (which will begin moderating by year-end), and whether the AI-driven demand surge in technology-adjacent practices translates into sustained BigLaw hiring at scale. The market will increasingly reward attorneys who can clearly articulate a practice niche, demonstrate client development potential, and engage with the process strategically. Clarity of positioning, not simply being available, is the currency of the 2026 lateral market.
Data sourced from Leopard Solutions | Analysis by Lateral Link | laterallink.com | May 2026