Today seems to be the day for an economic reality check. And while some believe that the economic downturn is about to turn around for the legal industry, the legal industry, in reality, is still being hit hard job losses:

The U.S. legal sector shed 1,300 jobs in May, according to statistics released Friday by the U.S. Department of Labor.

While the industry has lost jobs every month so far in 2009, May’s losses mark the smallest drop in legal jobs this year. All told, 14,400 legal-services jobs are gone since the beginning of the year, and 25,500 since a year ago, according to the Labor Department. The statistics are seasonally adjusted. When not adjusted, the department reports 30,200 job cuts over the past year.

In remarks today, President Obama does not share in the belief that the economic recovery is around the corner:

Obama called the smaller-than-expected slashing of jobs a sign that the economy was moving in the right direction. But he cautioned bluntly that “we’re still in the middle of a very deep recession” and that “it’s going to take a considerable amount of time for us to pull out of.”

And while the federal stimulus package promises 600,000 new jobs, I don’t know if any of those will assist the 30,000 legal sector jobs lost in the past year.

Eager to show action on the ailing economy, President Barack Obama promised Monday to speed federal money into hundreds of public works projects this summer, vowing that 600,000 jobs will be created or saved.

In today’s economic times, we must be nimble with our ideas of what a career in the legal industry looks like.

Gone are the days of the first year associate making $160,000.

Gone are the days of an AmLaw 100 firm being the brass ring for career choices.

However, many mid-sized, small and regional law firms are prospering in the current economy.

With eight lateral hires this year, Sheppard Mullin is not exactly buckling under the weight of the recession. Rate pressure at larger firms is driving partners to look around for better prospects, said Sheppard Chairman Guy Halgren.

“We hear a lot from lateral candidates: ‘My current firm is pricing me out of my market,” Halgren said. “It’s definitely one of the things that’s a major point in every lateral conversation: ‘How much flexibility will I have on my rate?’ Our rates are generally lower than the firms from where our candidates join us.”

While lateral moves at the top firms have nearly frozen, midsize firms like Sheppard, Mullin, Richter & Hampton; Buchalter Nemer; and Allen Matkins Leck Gamble Mallory & Natsis are regularly cranking out new-hire press releases.

While the motivations for partner moves are numerous and often complex, sources said midsize firms are seizing on several opportunities in the current economic downturn: Clients want lower rates; partners want more control; midsize firms that didn’t go gangbusters on expansion in the boom times still have the resources to invest in smart hiring; and midsize firms are convincing partners they are more financially stable. (Emphasis added.)