Jobs and Salaries for New Lawyers

April 30th, 2017 / By Deborah J. Merritt

What does the job market look like for new lawyers? The ABA will soon release statistics about the Class of 2016, and NALP will add additional information by the end of the summer. But the Bureau of Labor Statistics (BLS) gives us an advance peak.

Each year, BLS reports job numbers and salaries for a wide range of occupations. This series of reports includes only salaried positions; for the legal profession, the series omits both solo practitioners and equity partners in law firms. Still, since most new graduates seek salaried positions, these numbers offer a useful measure of the profession’s ability to absorb and pay new members.

How Many Jobs Are There?

BLS estimates that there were 619,530 salaried lawyers in 2016. That’s an increase of 9,600 jobs since 2015, when there were 609,930 lawyer positions. The increase is better than in the previous year, when the number of jobs grew by just 6,620. But it falls short of increases in 2012-2014, when lawyer jobs grew by more than 10,500 each year. There were 10,970 new jobs in 2012; 10,750 in 2013; and 10,640 in 2014.

The trend since 2012, in other words, is downward. The number  of salaried jobs for lawyers is still growing, but it is not clear how fast the pace will be in coming years.

Salaries

The bigger news about lawyers lies in salary trends. The median salaried lawyer still takes home a healthy paycheck ($118,160 per year) but that amount is lower, in constant dollars, than it was in 2006. After adjusting for inflation, the median salaried lawyer earned 2.9% more ($121,562) in 2006 than today. [To see those medians, as well as salaries reported in the rest of this column, you need to download the “national” excel sheets for each year from this page.]

Salary trends are even worse for lawyers below the fiftieth percentile. At the twenty-fifth percentile (and, again, using constant 2016 dollars), lawyers earned $82,935 in 2006 but just $77,580 today. That’s a decline of 6.5%. At the tenth percentile, the figures are $60,004 in 2006 and $56,910 today–a decline of 5.2%.

As a result of these declines, lawyers are losing ground compared to other occupations. In 2006, only six occupational groups earned a higher median salary than lawyers:

• chief executives
• physicians and surgeons
• dentists and dental surgeons
• air traffic controllers
• podiatrists
• engineering managers

Today the list is much longer. In addition to those six occupational groups, workers can expect higher median salaries than lawyers ($118,160) if they are:

• nurse anesthetists ($137,800)
• computer and information systems managers ($135,800)
• marketing managers ($131,180)
• petroleum engineers ($128,230)
• airline pilots, copilots, and flight engineers ($127,820)
• pharmacists ($122,230)
• financial managers ($121,750)
• advertising or sales managers ($120,420)
• natural sciences managers ($119,850)

Some of those highly paid occupations are small, but others employ a significant number of workers. There were, for example, 543,300 salaried financial managers in 2016–an increase of 12,180 positions since the previous year.

Check the 25th Percentile

If we focus on the 25th percentile salary for lawyers, we see even more clearly the salary erosion compared to other occupations. At this level, a large number of occupations exceed pay for lawyers (which, recall, is $77,580). Workers earning more than that figure (at the 25th percentile within their own occupation) include all of the above categories plus:

• computer hardware engineers ($88,290)
• computer and information research scientists ($87,400)
• compensation and benefits managers ($87,120)
• nurse practitioners ($86,970)
• political scientists ($86,600)
• physician assistants ($86,130)
• nurse midwives ($85,750)
• software developers, systems software ($83,270)
• purchasing managers ($82,880)
• optometrists ($81,480)
• HR managers ($80,800)
• PR and fundraising managers ($78,710)
• Training and development managers ($78,050)

And that’s just a partial list. Law school graduates might qualify for some of these jobs, such as HR manager or compensation manager, but they could achieve the same positions without the expense of a law degree. Other positions require a different type of training, often less expensive and arduous than law school.

We don’t talk much about the 25th percentile for salaries, but it’s a very relevant marker for students contemplating a career path. New hires tend to start low on the salary scale, so high school and college students will know employees in this salary range. The junior lawyers they meet are no longer earning higher incomes than the junior pharmacists, nurse practitioners, political scientists, or HR managers. This shines a new light on their career decisions.

What About the Upside?

Even if entry-level salaries are eroding in law, can prospective lawyers expect to flourish economically later on in their careers? Income erosion, unfortunately, appears to be occurring even at the 75th percentile of lawyer incomes. In 2016, those fortunate lawyers earned $176,580 per year. But in 2008, the earliest year that figures for this group are available, they received $181,099 (in 2016 dollars). That’s a decrease of 2.5% in constant dollars.

Once again, the decrease means that the financial upside in law has diminished compared to other occupations. In 2008, only chief executives, physicians and surgeons, dentists, and dental surgeons earned higher salaries than lawyers at the seventy-fifth percentile. Today, the occupations with higher salaries at that percentile include those groups plus:

• airline pilots, copilots, and flight engineers ($195,550)
• nurse anesthetists ($189,880)
• postsecondary law teachers ($180,320)
• petroleum engineers ($179,450)
• marketing managers ($178,690)

The income ascension of postsecondary law teachers deserves a separate post, coming soon. Meanwhile, the growth of this list demonstrates that, even at the seventy-fifth percentile, lawyers are losing some of their salary luster.

At the very top of the salary scale, the story changes. The mean salary for lawyers has grown in constant dollars over the last decade. In 2006, it was $134,837 (in 2016 dollars) and today it is $139,880. Growth in the mean–while the median, twenty-fifth percentile, and seventy-fifth percentile have all declined–means that salaried lawyers at the top of the ladder have greatly increased their incomes. BLS does not report those salaries but they have increased enough to pull up the mean salary significantly.

The uneven salary distribution for lawyers, in other words, continues to widen. At the high end, salaries are still increasing faster than inflation. But for the majority of salaried lawyers (at least seventy-five percent), salaries are falling in constant dollars and earnings in other occupations are outpacing them.

The Bottom Line

No one should go to law school just to make money. Wise counselors have been saying that for years, and it’s even more true today than it was ten years ago. Other occupations offer salaries comparable to the income earned by many lawyers; college students can now weigh the benefits of those careers against those available in law.

The BLS figures also underscore the growing income divide in our profession. Law has always been a profession with two hemispheres, but the data reviewed above suggest that the income gulf is widening. The gulf itself is a negative feature for some current and prospective lawyers; they feel that the profession is financially risky, with outcomes determined by factors beyond their control.

All of these issues are ones that legal educators must continue to confront: the issues affect both law school’s appeal to prospective applicants and the tuition those applicants will be willing to pay.