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How Many Lawyers?
January 7th, 2014 / By Deborah J. Merritt
How many lawyers will our economy support during the next decade? As legal educators, we are often bullish about our industry. We know our graduates’ talents, and we see vast unmet needs for legal services. We also know that legal rules are more complex than ever. From those perspectives, it seems logical that demand for lawyers will increase sharply–especially as the effects of the Great Recession fade.
But our perceptions can mislead us. Most of us lack economic training; we also know little about the macroeconomic data that inform labor market forecasts. As academics, we don’t even know much about the economics of law practice. Our very position in the industry, finally, tempts us to take a rosy view of the job market.
The best source of labor market predictions, in our industry and others, remains the Bureau of Labor Statistics (BLS). Every two years, the Bureau prepares a ten-year forecast of job openings in more than 800 occupations. The Bureau uses extensive data and complex macroeconomic models to prepare those predictions. Its economists analyze the economy as a whole, accounting for demographic shifts, technological change, complex interactions among industries, and consumer purchasing power. The final projections are much more reliable than anything that armchair experts might offer.
The Bureau recently released its projections for occupational job openings over the next decade. How will the legal profession fare? The news remains depressing.
Declining Projections
In 2008, at the height of our profession’s prosperity, the BLS projected that 240,400 job openings for “lawyers” would occur in the ten years between 2008 and 2018. That estimate encompassed all jobs practicing law, including work done by solo practitioners. It also counted both jobs generated by expansion and those required for replacement. The projection did not include jobs for judges and judicial law clerks, small categories that the BLS counts separately. I return to those categories below.
Note that even this 2008 projection fell far short of the number of students graduating from U.S. law schools at the time. ABA-accredited law schools conferred 43,588 JD’s in 2008. Even if just 80% of those graduates (34,870) sought jobs as lawyers, that number far exceeded the 24,040 new lawyer jobs per year that the BLS projected at that time.
The forecasts, however, got worse. In 2010, in the wake of the recession and rapid shifts in the legal profession, the Bureau adjusted its projection downward. It estimated that in the ten years between 2010 and 2020, the economy would support only 212,000 new lawyers. That number represented an 11.8% drop in the number of openings for new lawyers.
“Well, of course,” you might think, “the economy was in a serious recession. Of course the number of job openings would decline.” Remember, though, that this projection covered an entire decade. The Bureau assumed that, even if the economy returned to full strength by 2020 (an assumption built into its models), the number of job openings for lawyers would be substantially lower over the decade than previously predicted.
Now the news has gotten even worse. In its latest projections, the Bureau has again lowered the predicted number of openings for lawyers. It now estimates that the economy will support only 196,500 new lawyers between 2012 and 2022. That’s another loss of 7.3%. Put another way: Four years ago, BLS expected the economy to support about 24,040 new lawyers per year. Now it expects only about 19,650 new lawyers per year to find jobs. That’s a loss of 18.3%.
The Bureau expects the absolute number of lawyer jobs to increase between 2012 and 2022, but the increases will be considerably smaller than previously predicted. The available openings, furthermore, won’t come close to accommodating the number of law school graduates–even if those numbers decline as anticipated.
Graduates and Openings
I previously calculated that about 36,260 students will obtain JDs from ABA-accredited law schools in 2016. Those are the students who just finished their first semester of law school and are on track to graduate. Once again, let’s assume that only 80% of them will seek jobs as lawyers–a generous allowance for JD Advantage jobs. Even if one-fifth of our graduates take jobs outside the “lawyer” category, we will still graduate 29,008 eager new lawyers in 2016.
The BLS, however, predicts that the economy will support only about 19,650 new lawyers per year. If that prediction proves correct, then lawyer jobs will exist for only two-thirds (67.7%) of the graduates seeking them–or only 54.2% of the full graduating class. Those ratios are slightly worse than the ratios for the Class of 2008, when the job market was much stronger. Even with reduced class sizes, we are losing the placement race. Graduating classes will have to shrink substantially more to approach the number of lawyering jobs that the economy is predicted to support.
Other Job Categories
As mentioned above, the BLS counts some “lawyering” jobs in categories of their own. Judges, Magistrate Judges, and Magistrates, for example, constitute a separate category from lawyers. So do judicial law clerks. Neither of these categories, however, offers much comfort for law graduates: BLS has dramatically reduced projected openings in these categories. In 2010, the Bureau estimated that the economy would support 9,600 new judges/magistrates and 6,800 judicial law clerks between 2010 and 2020. The more recent predictions have cut those numbers to just 5,200 new judges/magistrates and 2,500 new judicial law clerks over the next decade. The latter reduction is particularly notable; it may represent cuts in government budgets as well as an increase in permanent law clerks.
Adding these small categories to the estimates offered above doesn’t alter the picture much. If we include job openings for judges, magistrates, and judicial law clerks, then the BLS predicts about 20,420 new openings per year for lawyers. That number will accommodate only 56.3% of the students projected to graduate from ABA-accredited schools in 2016. (To be clear, I think it’s appropriate to include judges, magistrates, and law clerks in these projections. I omitted them in my initial calculations because the numbers are small and the BLS has redrawn these small categories over the years. For clarity, it’s easier to focus first on the primary “lawyer” category.)
According to the BLS, only three categories of law-related professionals enjoy better prospects today than they did two years ago: paralegals, title examiners, and other legal support workers. The Bureau raised projected openings in each of those fields in its latest estimates, producing a combined total of 119,600 expected openings during the next decade.
Why Won’t the Economy Support More Lawyers?
The reasons for this decline are complex. They include lasting effects of the recession, technology, new efficiencies in the provision of legal services, and changing demographics. The last factor is particularly intriguing; it is one that we in the legal academy often overlook. My next post will explore these economic change-agents in more depth.
Will the Competition Close?
December 29th, 2013 / By Deborah J. Merritt
As law school enrollment continues to fall, industry experts have started to speculate about how many schools will–or should–close. Law schools themselves have a great interest in this. Some are worrying if it will happen to them. Others wonder whether the closure of competitors will ease their own distress.
The latter line of reasoning concerns me. Over the last few years, I’ve heard both academics and practitioners suggest that, once the market closes the weakest law schools, all will be well for the remaining 50, 100, or 150 schools. This analysis, I’m afraid, is too simplistic for the market we face.
As I explain below, at least five forces will keep most law schools in business. Many of these schools will be smaller than they were in 2010, with fewer students and smaller faculty/staff rosters. They will, however, survive–and will compete aggressively for students, employer connections, and new resources. That outcome offers mixed comfort for law schools. Some will do relatively well in this new competitive environment; others will limp along in a much leaner state.
For students, employers, and clients, this outcome is promising–more positive, actually, than the prospect of wholesale law school closures. The competition among law schools will make them much more responsive to students and the workplace. Over the last two years, many schools have already lowered effective tuition, changed curricula, and cultivated stronger relationships with employers. These changes, I predict, will not be short-term solutions that we discard “after the market shakes out.” Instead, they are the beginning of a fundamental shift in legal education that will be fueled by ongoing competition among schools.
The market works, but it will follow a peculiar path in legal education. Rather than closing a large number of law schools, the market will incite aggressive competition among schools that have been told by their universities: “We’re not going to close your doors, but you have to sustain yourself financially.”
Why Won’t Law Schools Close?
Law schools undoubtedly have been graduating more JD’s than the US economy needs. Students have gotten wise to that fact, and law school applications have plummeted. Why, then, won’t the weakest fifty–or one hundred–law schools simply close? That’s what would happen in many industries. Higher education, however, has several features that will keep most law schools alive.
1. It’s very hard to close a public law school. Most observers agree that each state will want to preserve at least one public law school. Those schools offer access to legal education for state residents, a supply of locally trained legal talent, and a certain measure of prestige. Very large states might rationally maintain a few public law schools to fill those needs.
What about all of the other public law schools–the second, third, or fourth schools in a state? A rational legislature might close some of those schools in response to dwindling demand for JD’s. Most of these schools, however, reflect strong regional interests within the state. Some reflect differing racial or ethnic populations. Do you think Ohio will close its law schools in Cleveland, Toledo, and Akron, telling those students to apply to the higher ranked public schools in Columbus or Cincinnati? That command would elicit the same reaction as Marie Antoinette’s famous exhortation to let the peasants eat cake.
If a public law school exists, it has strong political forces behind it. Public law schools, I predict, will close only if the political dynamics of a state have changed so much that its constituency no longer enjoys political clout. They will not close simply because the demand for JD’s has declined.
2. Law schools have powerful alumni. Recent graduates may be suffering in the marketplace, but most schools have at least a handful of wealthy and/or politically connected alumni. At both public and private schools, these graduates will pressure the board of trustees, president, provost, development office, and others to maintain the law school. At public schools, these alumni will also weigh in with the legislature and higher education system.
It won’t take many alumni to keep a law school open–especially since these alumni often matter to the full university. Some of them contribute money to other departments; others have careers that reflect well on the university as a whole. Still others are connected to community leaders, government officials, and business moguls who matter to the university. Universities will not want to alienate these alumni.
3. Law schools are part of a product line. Businesses sometimes maintain an unprofitable product as part of an overall marketing strategy. A product may build brand loyalty, or complete a product line, even though it does not generate profits of its own. Drugstores, for example, sell a full range of medications–not just the most profitable ones.
No university teaches every subject, and there are many superb universities without law schools. The universities that already have law schools, however, think of them as part of the product line. Top research universities (those ranked very high or high in the Carnegie classification) pride themselves on their comprehensive research programs. Those universities are likely to maintain existing law schools as part of their commitment to comprehensive research.
Law schools located at other universities, ironically, may be even less likely to close. At those universities, which grant fewer doctorates and attract less research funding, the law school may represent a larger percentage of the university’s research activity and academic reputation.
4. Law schools are cheap academic units to operate. The first three forces would have limited impact if law schools were expensive to maintain. No university will hemorrhage dollars to sustain a law school. Law schools, however, are remarkably cheap academic units.
We don’t require laboratories or expensive equipment. Our students use simple classrooms, and our faculty conduct their research with desks, modestly powered computers, and an internet connection. Our faculty earn high salaries, but they are no longer soar as high over the rest of the university; check out medical, business, and engineering salaries–as well as the ones paid to star professors in the arts and sciences.
We offer sizable scholarships to attract top students, but we rarely offer full tuition waivers plus living stipends–the gold standard demanded by top graduate departments. We employ some writing instructors and clinical faculty, but those numbers are tiny compared to the armies of composition instructors, math instructors, lab supervisors, and other teaching assistants required in other parts of the university.
Even our clinical education is cheap. Colleagues from Dentistry and Veterinary Medicine visited me recently and were puzzled when I told them that my office was located in the law school’s clinic. “This can’t be a clinic,” they exclaimed, as they looked at a few offices, computers, tables, and a conference room. I reminded them that lawyers don’t need x-ray machines, MRI’s, or sanitizing equipment–much less stables, food, and handlers to care for our clients.
We think of law schools as expensive because we have set our tuition so high. And, of course, we are more expensive than other units in some ways: we usually don’t charge for our clinical services, and we don’t attract the multi-million-dollar grants and contracts that grace other departments. On balance, however, we are very cheap departments for a university to maintain.
5. Law schools can reduce their costs. As icing on the cake, there is still plenty of room for law schools to reduce their costs. Other parts of the university–particularly the arts and sciences–have been cutting budgets for a long time. Most of their doors remain open, and law schools have a long way to go when it comes to trimming budgets in the face of market pressure.
Tenured faculty are expensive, but they retire or take other positions. Some public law schools are benefiting from state-wide pension changes that are luring faculty into retirement. Schools don’t have to replace all of these departing faculty–especially if enrollments fall–and they won’t. For the faculty who remain, salary increases will be lower and teaching loads may increase.
Law schools will also discover that they can make do with fewer staff, fewer conferences, less travel money, and smaller libraries. Expenses that once seemed essential to satisfy faculty, secure prestige, and fight for US News rank will seem less essential when schools have to meet reduced budgets. Extras don’t matter as much when the first priority is to stay in business.
Budget cutbacks won’t affect a few highly ranked schools, which may be able to continue business as usual. But cutbacks will occur at schools throughout most of the law school hierarchy. My point here is that there is plenty of room to cut law school budgets, and that our competitors will choose that course rather than quietly go out of business.
The Bottom Line
A few law schools, especially stand-alone ones, may close their doors in the coming years. Most law schools, however, will remain open. Their universities will tell them: “Stay in business, but cover your costs.” This will be tough to do at a time when applications are declining and students are increasingly price sensitive. To balance budgets, schools will cut costs, modify curricula in ways that appeal to students and employers, build stronger relationships with employers, and seek new sources of revenue. All of this will happen, not in a stop-gap manner while we wait for the old days to return, but as part an ongoing, highly competitive environment. Most schools will survive, but the happiest and most prosperous ones will be the ones that appeal most to students and employers. In its own way, the market will speak.
The Value of a Degree
December 18th, 2013 / By Deborah J. Merritt
Are college graduates better off than non-graduates? If so, does value vary by the type of institution attended? How much value does a JD add to a BA? Does that value vary by institution?
Both critics and defenders of higher education have struggled with these questions. Most have recognized that we can’t measure a degree’s value solely by financial reward. We hope that higher education also improves health, autonomy, personal relationships, emotional well-being, community engagement, and other goods. But how can we measure all of those outcomes?
Now there’s an app for that.
The Gallup-Purdue Index
The Gallup Organization and Purdue University have just announced creation of the “Gallup-Purdue Index.” This index will attempt to measure both career and well-being outcomes for college graduates.
Gallup has decades of experience asking people about their financial status and well-being. The company plans to draw upon that knowledge to devise questions for the new index. Participants will answer questions about their jobs, income, educational debt, other debt, and financial management. They will also provide information on their workplace and community engagement, personal relationships, physical fitness, sense of purpose, happiness, and stress.
Gallup will start conducting its surveys in the new year, with the first results available in spring 2014. The polling company plans to survey 30,000 college graduates a year for at least five years, generating a database with responses from 150,000 individuals.
Benchmarks, Not Rankings
Notably, Gallup does not plan to release data about individual colleges or universities. Instead, it will aggregate data by category. The results, for example, could report how individuals of different races fare after graduation, how graduates of research universities compare to those of liberal arts colleges, or how outcomes vary by region of the country. These data, Gallup suggests, will create benchmarks that institutions can use to gauge their own graduates’ outcomes.
The results, however, undoubtedly will do their part to fuel competition among universities. Gallup, for example, has proposed releasing results by athletic conference. Do Big 10 graduates earn more than Pac-12 ones? Are they more happily married? If fans don’t like the BCS system, they can embrace Gallup-informed “well being” competitions among the conferences.
Although Gallup will not announce institution-specific results, colleges and universities can contract with the company for surveys of their own graduates. Each institution could then compare its results to the national benchmarks. Purdue has already asked Gallup to survey its graduates; other colleges may do the same.
What Will We Learn?
Like all social science research, the Gallup-Purdue Index will have significant limits. If Pac-12 graduates are happier than Big 10 ones, is that because of their college experiences or because they live in sunnier states? If Ivy League graduates earn more money than graduates of land-grant universities, is that because their college education was superior, their native talents were greater, their pre-college advantages were deeper, or their employers favored the Ivy League for outdated reputational reasons?
Even if we disentangle these strands and identify the colleges that produce the happiest, most successful graduates, how will we know which part of the educational experience paid off? Was it class size, particular majors, the campus environment, the football team’s success? In the social world, measurement often generates new questions rather than solid answers.
There’s also a dark side to surveys like the Gallup-Purdue Index. Users can interpret results to support their pre-existing notions: If my college fares well, I’ll tie the results to my pedagogy. If my graduates stumble, I’ll blame the weather.
There’s a danger, furthermore, that policymakers will seize upon data to construct superficial answers to complex questions. It’s unlikely that one, or even three, college attributes explain graduate well-being. Understanding the relationship between higher education and adult satisfaction will require considerable exploration. As the data generate new questions, we’ll have to commit to asking those questions–not simply settling for first-generation answers.
Indices, finally, seem to breed competition. Administrators, educators, students, and alumni will await the annual index as eagerly (and anxiously) as they anticipate the US News releases. In my worst nightmare, Gallup will update survey results weekly–just like the football rankings. We already spend far too much time on rankings and competition in higher education.
The Up Side
On the other hand, the Gallup-Purdue Index could teach us a lot about higher education. We spend a lot of time speculating about the benefits of higher education; more data could begin generating answers. Used responsibly, high-quality data could help us address essential issues: What type of education gives low-income students the best boost? How do liberal arts majors compare to STEM specialists? Are there educational innovations that will advance the progress of women and minorities in the professions?
Measurements also facilitate accountability. Now that a degree can cost more than a starter house, and now that we have the capacity to gather substantial data about outcomes, we should hold educational institutions accountable. If we can improve results for our graduates–in any facet of their lives–we should work towards that end.
What About Law Schools?
So far, the Gallup-Purdue Index will focus on college graduates. It seems, though, that law schools could get in on the act. Individual schools could commission surveys to determine whether their graduates obtain value from earning a JD. Are those law school graduates happier than college grads with no further education? Richer? More stressed? More or less involved in the community?
To make those comparisons, each law school could choose college benchmarks that match their feeder schools. Maybe a particular law school’s grads are happier and more successful than the graduates of research universities in the region, but not better off than the grads of local liberal arts colleges.
Equally intriguing, the ABA, NALP, or another national group could commission Gallup to conduct a survey of law school graduates nationally. How do those graduates compare to college grads without further education? Do the results depend on the type of law school, type of post-law job, or region of the country?
As legal educators, we pride ourselves on the fact that our degrees last a lifetime. Now that we have the tools to explore the extent of that impact, we should seek that knowledge.
Beneventan Writing
December 17th, 2013 / By Deborah J. Merritt
My university library recently announced its acquisition of a rare piece of Beneventan writing. The acquisition is just a page fragment, literally a scrap of paper dating from the eleventh century. Why does this small piece of paper matter?
Ohio State has a Center for Epigraphical and Palaeographical Studies; our Classics Department supports courses and research projects related to medieval manuscripts. Because Beneventan script is so rare, faculty doing this work have relied upon digital images and photographs to study the writing. “[T]here’s nothing wrong with that,” Ohio State’s rare books curator acknowledged. “But it’s awfully nice to have a genuine example to show the students because you can see the grain of the parchment and the way the ink has skittered across the page because of the way the scribe has drawn his quill across it.”
As a scholar, this makes sense to me. I learn a lot from digital images and photographs, but original artifacts have special power. I don’t need to study everything in the original, but access to some originals greatly enhances study and teaching.
As I reflected on this, I realized that the same rationale supports clinical teaching in law, medicine, and other parts of the university. We can show students photographs of courtrooms; we can engage them in digital simulations; we can assign them thousands of appellate opinions. But if we want our students to understand law as deeply as a Classics scholar strives to understand Beneventan writing, then we need to let our students work with originals.
A real client, with a real problem, in a real world setting–that’s the the law school equivalent of the manuscript fragments in the library’s rare books collection. The rare books room and law school clinic seem to lie at opposite poles of the campus world. But at root, they share an essential attribute: they both enable deep learning through engagement with originals.
Postscript: For those who are curious about Beneventan script, the writing was used in Southern Italy between the eighth and thirteenth centuries. The Monastery of Monte Cassino, founded by St. Benedict, used this script; that enhanced the script’s importance in Benedictine writing.
Law School Applicants
December 11th, 2013 / By Deborah J. Merritt
LSAC has released its first report on the current crop of law school applicants. Paul Campos offers a trenchant analysis that I expand upon below. After reviewing the numbers, I explore the question that nags at so many of us: Where are all of those applicants going if not to law school?
Recent History
Paul first charts the number of applicants to ABA-accredited law schools during the last four years. Those numbers, drawn from LSAC sources, are:
Applicants for fall 2010: 87,900
Applicants for fall 2011: 78,500
Applicants for fall 2012: 67,900
Applicants for fall 2013: 59,426 (preliminary)
Many people assume that fall 2010 represents the high water mark for law school applicants, but that’s not true. As Paul noted in a similar post last year, the number of law school applicants peaked in 2004 when 100,600 individuals applied to ABA-accredited schools. Applicants fell significantly for several years after 2004, rose modestly in 2009-2010, and have plummeted for the last three years.
As noted above, we have only preliminary figures for the number of students who applied to join this year’s 1L class. In recent years, however, the final figure has not varied by more than 0.5% from the preliminary number. If the final figure for 2013 varies that much, the true number of applicants might have been as high as 59,724.
That’s a decline of 32.1% in the number of applicants between fall 2010 and fall 2013. From the 2004 peak, the decline has been a very substantial 40.6%.
Current Applicants
That brings us to this year’s applicants. LSAC reports that 14,171 individuals had submitted applications by December 6, 2013. That’s a 13.6% decrease compared to this point last year.
The admissions cycle, however, is still young. Last year, a noticeable number of students applied to law school in the late winter and early spring, perhaps responding to news reports that applicants were down and hopefuls might obtain more favorable spots or scholarships. If the same happens this year, late applicants might narrow the gap between this year and last. If so, 13.6% could overestimate the applicant drop for the current year.
Unfortunately, a more conservative method leads to an even higher projected drop in applicants. Let’s look, as Paul does, at the percentage of applicants who had submitted their applications by this point last year. According to LSAC, that figure was 28%: By December 7, 2012, 28% of the year’s eventual applicants had submitted at least one law school application.
If applicants follow the same pattern this year, then we can expect a total of 50,611 applicants by the time the admissions cycle ends in August. That’s 14.8% fewer applicants than the preliminary figure for this year (2013), and it’s 15.3% less than the final 2013 figure I projected above.
First-Year Enrollment
This is, of course, grim news for law schools. Some applicants are not qualified for admission, and others decide not to attend law school. 50,611 applicants will yield a much smaller class. I agree with Paul Campos that we may welcome no more than 35,000 first-year students to accredited law schools in Fall 2014. That’s one-third less than the number of students who enrolled in Fall 2010.
Where Are They Going?
What has happened to those law school applicants? What are they doing instead of attending law school? I can’t answer for all of them, but I can offer some suggestions. In doing that, it’s particularly important to note that interest in law school began declining in 2005–not 2011.
The last decade has witnessed the emergence of many new professional jobs, especially in computer science, health care, and engineering. Take a look at this list of new occupations that the Bureau of Labor Statistics added to its surveys in 2012.
Those brand-new occupations include several that would interest bright high school students: information security analyst, computer network architect, web developer, computer network support specialist, nurse anesthetist, nurse midwife, nurse practitioner, and genetic counselor. Those new occupations already employ more than 629,000 people–more than the number of judges, magistrates, lawyers, and judicial clerks (620,340 total) reported in the same occupational survey.
This survey includes only salaried workers, so it omits solo practitioners, law firm partners, and other self-employed lawyers. Even if we double the number of employed lawyers, however, the comparative number of jobs in these competing occupations is eye-opening.
Remember, too, that these eight categories are brand-new fields: graduates won’t face the entrenched interests, established workers, and long career ladders that new lawyers face. These jobs, moreover, only scratch the surface of alternative careers. The BLS recently added web developers to its occupation list, but it already (and separately) counts computer programmers, software developers (applications), and software developers (systems). Almost 1.3 million people hold salaried positions in one of those three categories.
Salaries for these new occupations range from comfortable to excellent. Nurse anesthetists, the highest paid category, average $154,390, well above the $130,880 average for lawyers or the $102,470 mean for judges and magistrates. The educational requirements for nurse anesthetists, notably, are similar to those for lawyers: They complete a BS in nursing as well as a 2-3 master’s program in anesthesia.
Employees in some other categories average lower salaries than lawyers, but need only a BA to enter their field. Most software developers possess only a BA. Yet the applications developers average $93,280 per year while the systems developers average $102,550. There were, by the way, more than 978,000 salaried employees in those two categories in 2012.
The lowest paying job among the ones I’ve cited is for genetic counselors. Those workers require a master’s degree and currently average only $55,820 per year. But genetics research and applications are exploding; this is one of the most intriguing, socially important, and potentially lucrative fields in the new economy. Today’s genetics counselor may advance with the field.
But That Requires Math!
We are conditioned to think of law students and STEM graduates as two different breeds. Law students notoriously dislike math, and some of them had unfortunate encounters with organic chemistry or other college science courses. This history feeds the notion that STEM careers can’t compete with law school. If students can’t do the math, they won’t qualify for these new occupations–leaving law school as their best option. Right?
The truth is, most of us did just fine in high school math and science. If we’d wanted to be software developers or nurse anesthetists–if those jobs had even existed when many of us graduated from high school–we could have pursued those paths in college and beyond. Today’s bright high school students are equally capable of pursuing those paths, and the paths have been beckoning.
Computers, genetics, and other technologies have made science cool for today’s smartest students–in the same way that Perry Mason was cool for us. If you’re a bright 17-year-old today, do you dream of drafting a killer discovery motion or designing a killer app? Would you rather be helping a client through a divorce or through life-saving surgery? Do you want to counsel clients on avoiding foreclosure or on avoiding genetically determined risks?
Don’t get me wrong: I love the law, and I know recent graduates with good legal careers. But I also know many unhappy law school graduates and many happy scientists. if we want to address the marked decline in law school applicants, we need to understand the full scope of the current workplace.
The FTC and Piano Teachers
December 10th, 2013 / By Deborah J. Merritt
Wall Street Journal columnist Kimberley Strassel recently described the FTC’s investigation of a nonprofit association of piano teachers. According to the FTC, the Music Teachers National Association (MTNA) was supporting anti-competitive practices through its code of ethics. One provision of that code discouraged music teachers from actively recruiting students from other teachers.
Strassel recounts that MTNA assured investigators that they had never enforced this provision. The association also offered to drop the provision immediately from its code. The FTC, however, persevered in its investigation. The agency required MTNA to produce thousands of documents, including some that were two decades old. MTNA complied with these requests, but the ongoing cost of the investigation prompted it to settle. As part of a consent decree–in which MTNA admits no fault–the nonprofit agreed to appoint an antitrust compliance officer.
Here’s where lawyers and legal educators should take note: The FTC wanted MTNA to appoint a lawyer as its compliance officer, but the nonprofit explained that it couldn’t possibly afford that expense. The regulators then allowed MTNA’s executive director, Gary Ingle, to fill the compliance role. Ingle is a former music professor, choral conductor, and academic administrator with a BA, MA, and PhD in music. He completed some “additional study” at the Cumberland School of Law, but does not hold any type of law degree.
In addition to taking over the compliance position, Ingle seems to have supervised his organization’s response to the FTC’s document request. Lawyers accompanied Ingle to an initial meeting with the FTC, but the nonprofit seems to have minimized legal expense as much as possible–both during the investigation and going forward.
What’s the Moral?
Strassel tells this story as one of outrage against government overreaching–her description of the document request as a “federal colonoscopy” is particularly memorable. You may agree or disagree with that position. This looks to me like a misallocation of government resources, if not downright abuse, but I have no idea what MTNA might have been up to.
I describe the MTNA story because of what it suggests about some of today’s legal work–and about how we might adapt our degree programs and business models to serve clients like MTNA. The FTC’s investigation was a significant “legal” moment for the nonprofit: When the feds come knocking, it’s time to call your lawyer. Attorneys, however, seem to have played only a small part in the investigation; they accompanied MTNA’s executive director to his first meeting with the FTC, and perhaps represented him in other meetings. MTNA, however, handled much of the response to FTC demands, and it will conduct its own compliance work (without lawyers) going forward.
According to Strassel’s column, MTNA has an annual budget of $2 million and a staff of twelve. This is not an indigent organization; it is more akin to the small businesses that many lawyers hope to serve. It also seems that the organization would have welcomed assistance at the right price. Ingle reports that he and his staff spent “hundreds upon hundreds” of hours responding to document requests. Rather than serve as untrained document reviewers, Ingle and his team might have preferred applying their expertise to helping music teachers. The market, however, did not provide an appropriate solution for the organization.
Entrepreneurs are starting to find ways to meet needs like the one MTNA experienced. Small businesses can post discrete legal projects online, seeking bids from experienced lawyers. Businesses and nonprofits can also hire a part-time general counsel or compliance officer. Small companies may also learn that they can hire document review workers directly, without paying a mark-up to their lawyers.
Lessons for Law Schools
As legal educators, we need to get on top of these trends. For too long, law practice has consisted of expensive services and pro bono work. As a nonprofit, MTNA may even have benefited from some of the latter. But there is a vast amount of legal work between those two ends of the spectrum. We need to figure out how lawyers (and non-lawyers) are tapping that market, and how we can prepare students to serve it.
This won’t be easy. It’s not as simple as adding a few clinical courses or experiential credits to the curriculum. Nor can we simply urge our graduates and career services staff to network with nonprofits and small businesses. The type of work that MTNA needed to respond to the FTC investigation, and that it will require for its future compliance role, won’t pay the wages that JD graduates hope to earn during their early years–and that many of them need to pay off large loans. Instead, we need to rethink both the structure of our degree programs and how “lawyer” tasks interact with non-lawyer work.
One response is the layered legal education that I have proposed and that others have recommended. Another is creation of early-career work that allows JDs to develop expertise while serving clients in cost efficient ways. Some law schools are trying to create those opportunities on their own or in partnership with for-profit companies.
Neither of these approaches is cost free. Nor are they guarantees of good careers for all. We know very little about career progression in the new legal market; those tracks will take many years to unfold. Meanwhile, stories like the one about MTNA remind us that we need to keep tabs on what is happening with clients and legal providers in today’s legal market.
Why Has Law Practice Changed?
December 8th, 2013 / By Deborah J. Merritt
When legal educators talk about changes in the legal market, we focus on the Great Recession, the slow recovery, globalization, technology, and the routinization of some legal services. These trends undoubtedly are shaping contemporary law practice, but they’re not the root cause of our graduates’ ills. The force that rules law practice today is competition: To comprehend the profession’s economic trajectory, we have to understand the tremendous rise in market competition for legal services.
The Post-WWII Years
During the third quarter of the twentieth century, the legal profession benefited from a remarkable number of trade restraints:
1. Bar associations maintained minimum fee schedules, which bolstered the price of routine legal work.
2. Professional regulations forbid advertising, which restrained competition among lawyers and prevented consumers from identifying cost-effective service providers.
3. Courts strictly enforced rules prohibiting the unauthorized practice of law, which helped lawyers maintain their monopoly over a wide range of services.
4. Professional regulations greatly restricted practice across state lines, requiring clients to hire new attorneys or local counsel for many matters.
In addition to maintaining these protections, the legal profession welcomed relatively few new lawyers each year. College enrollments were lower then than now; few women or minority men considered attending law school, and they encountered formidable obstacles if they did; and many law students left school before completing the degree. In 1963, just 9,638 students graduated from accredited law schools.
The Tide Turns
During the final quarter of the twentieth century, the legal profession’s protections began to fall. The Supreme Court struck down minimum fee schedules in 1975, making clear that antitrust prohibitions encompass the legal profession. Two years later, the Court initiated a series of decisions striking down restrictions on attorney advertising.
At the same time, state supreme courts and legislatures opened doors for non-lawyers to perform tasks that lawyers had once claimed for themselves. Accountants and title agents replaced lawyers in some roles. A new class of paralegals emerged to assist–and then replace–junior lawyers on some of their work. Companies began generating do-it-yourself forms for individuals with simple legal needs.
Barriers to interstate practice also diminished. States began to repeal residence requirements, and the Supreme Court declared those rules unconstitutional in 1985. As law firms expanded across state lines, and as corporate clients demanded more fluid legal counsel, states eased restrictions on interstate legal assistance.
As the profession’s economic protections diminished, its numbers swelled. Accredited law schools graduated 27,756 JD students in 1973, almost three times the number that had earned degrees ten years earlier. By 1983, the number hit 36,389, almost four times the number who graduated in 1963. During the last eight years of the century, each class exceeded 39,000 graduates–and two topped 40,000.
First Impact
These momentous changes in the legal profession first affected solo practitioners and others who served individuals and small businesses. Those lawyers were the ones who handled many of the matters taken over by non-lawyers; they also benefited most from minimum fee schedules. Between 1975 and 1995, the median, inflation-adjusted income of Chicago solo practitioners fell by almost 50%. For lawyers at the smallest Chicago firms, median income fell by 25%. Both of those figures come from the groundbreaking study conducted by John P. Heinz and his colleagues, Urban Lawyers (p. 163). That study, published in 2005, remains one of the best analyses we have of the legal profession.
Notably, Heinz and his team found that the median income of government lawyers fell during the same period. In 1995, median income for those lawyers was $45,000. Twenty years earlier, it had been $70,828 (in 1995 dollars). Government pay doesn’t depend directly on minimum fee schedules, advertising restrictions, and similar market restraints, but it probably does respond to compensation in the private sector. As solo and small-firm attorneys earned less, government was able to offer lower salaries to attract those lawyers.
The New Century
Since 2000, technology has greatly intensified the changes that began during the last quarter of the twentieth century. Advertising in phone books and on billboards promoted the fortunes of some lawyers, but internet advertising is much cheaper and it reaches more potential clients. The internet has also fed aggressive price competition: consumers can now compare prices for many legal services before they contact their first lawyer.
Computers have made do-it-yourself legal forms more sophisticated, user-friendly, and accessible. One online company, LegalZoom, has generated legal documents for more than 2 million clients since 2000. An online law firm, LegalForce RAPC Worldwide, declares that it “protects more intellectual property as patents or trademarks per year than any other law firm on the planet” and that it secures this protection “for a fraction of the cost” charged by conventional firms.
These technological tools have moved well up the ranks of law practice. Major law firms and corporations use computers to conduct discovery, draft legal documents, comply with government regulations, and perform other professional tasks. Technology has also enabled these organizations to tap lower-wage workers abroad; countries with rising economies have improved their education and infrastructure to meet that demand.
Technology and globalization then prompted innovative lawyers to restructure other parts of their practice. These lawyers reduced prices and secured new clients by unbundling legal tasks and routinizing some of their services. Having successfully shifted routine work to computer programs and offshore workers, these lawyers moved other tasks to staff attorneys and contract lawyers.
The recession and slow recovery exacerbated all of these trends. Even the wealthiest clients wanted price cuts, and they were vocal about their needs. Technology allowed them to track their legal bills more closely than before, to solicit bids from competing firms, and to press for lower prices. Globalization permitted them to look abroad for both high-level legal counsel and routine support work. Well versed in the benefits of efficient production and commoditization, corporations hired law firms that endorsed those approaches.
By now, we’re all familiar with this part of the story. We tend to forget, however, that these changes are occurring in a legal market that is vastly more competitive than it was in earlier years. Today’s market reflects the pro-competitive changes implemented during the late twentieth century. Those changes, moreover, continue to unfold. Courts and bar associations are still discarding rules that restrain competition; non-lawyers are taking on still more law-related tasks; and the largest JD class in history graduated in 2013. Even if graduating classes now contract, we have already flooded an increasingly competitive market with new lawyers.
The Market’s Triumph
Competitive market forces are the most important characteristic of today’s legal market. Technology, globalization, and commoditization are key trends, but their impact depends on the economic context. If the legal profession still enjoyed the protections it held during the 1970s, today’s technology and globalization might have produced more jobs and higher salaries for lawyers. In today’s competitive market, on the other hand, these trends are pushing inexorably on the bottom line. Clients are tracking prices and seeking competitive bids; law firms are employing efficient technologies and low-cost workers to meet client demands; and non-lawyers are continuing to take over legal work.
These competitive forces are highly favorable for clients. The law practice I knew in the 1980s was remarkably inefficient. Highly paid associates proofread briefs, reviewed documents, and continuously reinvented the wheel. Clients of all types paid more for legal services than they should have; they had no other options. A competitive market has given clients more choices, reduced prices, and (despite the protestations of some lawyers) caused no apparent loss in quality. Indeed, competition may have spurred some lawyers to provide higher quality services.
This competition would have forced 21st-century lawyers to make their practices more efficient, even if technology and globalization had remained stable. Rapid advances in the latter forces, however, compounded the impact of a newly competitive market. These changes offered significant efficiencies that the competitive market insisted we adopt. Rather than enduring a simple shift from protectionism to market competition, which would have been dramatic in itself, the legal profession had to adapt to open competition and new efficiencies at the same time.
This combination explains why law graduates will continue to face a daunting job market–and may not earn as much during their lifetimes as recent generations of lawyers did. The legal market is not rotating through a cycle; it is tumbling out of protectionism. Even when the economy booms again, corporate clients will not pay first-year associates to do work that overseas lawyers can handle. Nor will mom-and-pop clients pay for customized wills and leases, when standardized documents serve their purposes. The efficiencies and cost economies that we have achieved in law practice are here to stay.
The new market, of course, will create opportunities for some lawyers. Technology-savvy JDs will profit by developing attractive software programs marketed to others. Lawyers with strong management skills will earn extra pay by coordinating interdisciplinary teams spread across the globe. Some law firms will prosper by identifying new practice areas and assembling the right combination of lawyers, other professionals, support staff, and technology to efficiently address those needs. As always, the market will reward lawyers with unusual legal knowledge, skills, or client connections.
For most lawyers, however, competition will reduce the financial rewards that recent generations captured. That’s what deregulation does. As we project the economic future of the legal profession, we have to remember our loss of market protections over the last forty years. Those changes have accumulated over time, and many of them acquired greater force with the emergence of new technologies and globalization.
The public, including the large corporations that pay our heftiest bills, is unlikely to restore the protections that favored 20th-century lawyers. Instead, our graduates will practice in a world of accelerating competition. Recent graduates are competing with more peers than ever before. Lawyers of all ages are vying with lawyers in distant cities, states, and countries. Lawyers everywhere face competition from computers and non-lawyers. Competition is the new hallmark–and driving force–of the U.S. legal profession.
Assumptions About JD Advantage Jobs
December 5th, 2013 / By Deborah J. Merritt
In a recent post, Professor Paula Young writes that she “hate[s] to make too many assumptions about graduates holding JD Advantage jobs.”
I wholeheartedly agree.
Ironically, we don’t need to make assumptions about these jobs: Law schools already have considerable data about them. Schools, however, are not disclosing the information they possess. Neither is NALP, which aggregates data nationally. I have written about this information gap before, encouraging schools and NALP to disclose more of the data they collect.
Here is a brief summary of what we know and don’t know, as well as what we publish and don’t publish, about JD Advantage jobs. We could eliminate much of the debate and mystery surrounding these jobs–simply by disclosing the data we already have about them.
What Are JD Advantage Jobs?
Career Services Offices do not simply gather information about whether a graduate is employed and, if so, whether the job is “JD Advantage,” “Bar Admission Required,” or some other category. In most cases, the office obtains the specific job title. Law schools, in other words, know whether their JD Advantage grads are compliance officers, investment bankers, accountants, land men, research assistants, paralegals, etc. They do not report those titles to NALP, but schools know them.
It would be quite easy for a law school to post a list of the JD Advantage jobs taken by their graduates each year, together with the number of graduates in each category. Compiling this information would take very little time at most schools. According to the ABA’s spreadsheet of 2012 job outcomes, half of all law schools had 25 or fewer graduates in JD Advantage jobs. Extracting those titles from existing spreadsheets and symplicity reports is straightforward: I hereby offer to do the work for any school that wants to send me their redacted data! This offer applies even to Thomas M. Cooley, the school with the highest number of JD Advantage jobs (161) among the Class of 2012.
Given the amount of ink that has been spilled over JD Advantage jobs, I don’t know why schools haven’t already published this information. There are some excellent JD Advantage jobs, and some schools have very positive stories to tell. Where the stories aren’t as positive, applicants deserve to have that information–and faculty members should be aware of the full spectrum of jobs taken by their graduates.
I hope it goes without saying that these disclosures should cover all JD Advantage jobs secured by a school’s graduates. Highlighting just a few jobs tempts cherry-picking.
Salaries
When it comes to salaries, we have less information about JD Advantage jobs than some of our publications suggest. Law schools request salary information from all employed graduates, and they report those figures to NALP. Graduates in JD Advantage positions, however, are substantially less likely to report their salaries than are graduates with jobs that require bar admission.
NALP does not publish all of the relevant salary information on the web, so I rely here on NALP’s hard copy book, Jobs & JDs, for the Class of 2011. In that class, 27,224 graduates reported jobs that required bar passage, while 5,214 reported positions for which the JD was an advantage. Among the first group, 15,999 disclosed their salaries; among the latter, just 1,771 did. NALP, in other words, knows the salaries for 58.8% of graduates who took jobs that required bar admission–but it knows those salaries for just 34.0% of the graduates who secured JD Advantage positions.
That’s a very large difference, almost 25 percentage points. NALP acknowledges that reported salaries are “biased upwards.” This is a problem for all salaries reported by NALP, but it creates special difficulties when comparing salaries across categories with different reporting rates.
NALP, for example, reports that the median salary for JD Advantage jobs among the Class of 2011 was $59,000. The median salary that year for jobs requiring bar passage was $61,500–which seems quite close. The comparison, however, does not take into account the much greater underreporting for JD Advantage jobs. Some individual law schools make the same mistake, comparing salary information for JD Advantage and Bar Admission Required jobs without noting the very different response rates in those categories.
When it comes to salaries for JD Advantage jobs, we need to do two things: (a) disclose clearly that we have less information about this category than about jobs that require bar admission; and (b) try to collect more information. If this employment category is important to our schools and graduates, we should devote more resources to understanding it.
Still Seeking Other Work
NALP’s employment questionnaire, used by almost all ABA-accredited law schools, asks a little-publicized question. The survey asks each employed graduate to check one of two boxes:
__ I continue to seek a job other than that described here.
__ I am not seeking a job other than that describe here.
NALP tabulates these responses by job category, but it does not publish the information anywhere on its website. Instead, the data are available only in NALP’s $95 annual report on jobs.
For the Class of 2011, here are the percentages of graduates in different job categories who were still seeking other work:
Bar Admission Required: 16.5% still seeking
JD Advantage: 46.8% still seeking
Other Professional: 52.1% still seeking
Non-Professional: 85.9% still seeking
These figures, of course, only approximate job satisfaction. Some ambitious graduates may always be seeking a better position, no matter how attractive their current job. Others may be dissatisfied with their work, but not actively seeking a new position. The relative percentages, however, are striking: law school graduates who hold JD Advantage, Other Professional, and Non-Professional jobs nine months after graduation are much more likely to be seeking other work than are graduates who hold jobs requiring bar admission.
As I wrote in a previous post, this pattern holds over time. Yes, some graduates are very satisfied with JD Advantage jobs. But for as long as NALP has collected the information, graduates in that category (or its predecessor, JD Preferred) have shown significantly higher rates of job seeking than their colleagues who obtained work requiring bar admission.
This information, as noted above, does not appear anywhere on NALP’s website–even though NALP has created an extensive page related to JD Advantage jobs, accompanied by a “detailed research analysis” of those jobs. Nor, to my knowledge, does any law school share this information about their graduates–although they all collect it. We could, if we wanted, publish the percentage of our employed graduates who are still seeking other work nine months after graduation. We could also break that percentage down by job category, revealing how many of our graduates in JD Advantage, Other Professional, and Non-Professional positions are seeking other jobs.
The information we collect about job seeking is at least as reliable as much of the other employment data we collect and publish. I have asked NALP, both through posts on this blog and direct emails, to add the job-seeking data to their site. They have not, unfortunately, done so. This type of omission contributes to ongoing distrust of law schools: We and our national placement organization are still disclosing data selectively. Applicants need to trust us to inform them, not merely to market to them.
Conclusion
We already know quite a bit about JD Advantage jobs. If every law school published the information at its disposal, applicants would understand the kind of JD Advantage jobs taken by that school’s graduates. Faculty members would also gain insights into those jobs. With disclosures from individual schools, scholars could aggregate data to build a more complete national picture of JD Advantage positions. We don’t need to make assumptions about these jobs; we have data about them. Let’s commit to disclosing and analyzing that information.
Three Adaptations to Attract Applicants
December 3rd, 2013 / By Deborah J. Merritt
I wrote earlier this week about three forces that will continue to dampen law school applications, even if overall employment rates improve. Those forces are (1) the greater transparency of job outcomes, (2) the changed composition of those jobs, and (3) the narrowing of entry-level career choices. These trends may have little impact on the fortunes of a few top-ranked schools, but I think other law schools would be wise to consider them. Here are three suggestions for responding to these forces.
Stress Career Paths Rather than Options
Law schools have traditionally stressed the flexibility of a JD, noting the many career paths that follow from legal education. It is true that lawyers pursue many careers, but the immediate choices for individual graduates are relatively constrained in today’s market. Law students, moreover, have to specialize early in law school to compete for some of those positions.
Rather than fight these facts, we should capitalize on them. After working with millennial law students for several years, I’ve observed that they often ask for designated paths. They are less likely than last century’s students to seek open-ended options. Instead, they want to know how to get from “A” (the first day of law school) to “Z” (an entry-level job as a prosecutor).
Today’s applicants, I think, would respond well to specialized programs–as long as the programs offer demonstrated pay-offs in the job market. The next era of transparency may measure outcomes for particular programs. If a law school designs a program for future prosecutors and criminal defense lawyers, and if 90% of students completing the program secure one of those jobs, that will impress applicants. The same principle would hold for other areas of law practice or particular settings, like small firms.
Schools could easily create these paths with existing courses, clinics, externships, and extracurricular activities. The building blocks are there; we just need to switch our mindset from one that favors options to one that focuses on paths. We also have to be willing to articulate these paths and measure success rates. If we create successful paths with demonstrated results, and share that information honestly with prospective students, I think that applicants will respond.
If you’re tempted to resist specialization, consider this: Document review requires no specialized education–any law school graduate can do it. Don’t you want something better for your graduates?
Blend Education and Employment
Government agencies, mid-sized law firms, small firms, and businesses hire most of our graduates. These employers care about people skills, personal qualities, and hands-on experience. They want new employees who already possess those skills and experience; better yet, they like to hire graduates who have already worked for them as summer clerks, part-time employees, or externs.
It’s a buyer’s market, so there’s no point arguing with employers about these preferences. The preferences make sense from the employer’s perspective, and they carry pedagogic weight as well. Some of the best learning occurs when students can combine classroom and workplace experiences.
Law schools already encourage students to work during the summer, permit upper-level students to work part-time during the school year, and field an impressive number of externship programs. We can build on that base to create more dynamic programs that blend education and employment in more central ways.
In part, this requires a simple attitude shift. Rather than treating externships and part-time jobs as necessary evils that compete for classroom time, we should embrace these experiences as positive additions to our students’ learning. We should take those workplace demands into account when scheduling classes. We should also consider charging by the credit hour, rather than the semester, so that students can integrate classroom and workplace experiences year-round without paying extra for summer classes or a seventh semester.
Most important, our faculties should engage with the organizations that employ our students. What do our students do for those agencies, firms, or businesses? How does that work fit with their classroom experiences? Are there doctrinal principles or skills that the employers would really like to see taught on campus? Are there experiences they would be willing to offer that would complement classroom work?
Too often, we draw a line between campus and the workplace, announcing that we will teach up to the line while employers provide everything else. Why not negotiate the line? Or work together during the students’ three years to create the best overall learning experience?
Blended learning fits well with my first recommendation, the creation of professional paths. A student who wants to become a commercial real estate lawyer should not have to figure out the right assortment of classes, internships, and jobs; she should be able to rely on the cooperative discussion of professors and lawyers in the field.
Create an Undergraduate Major in Law
I’ve written before about the benefits of creating an undergraduate law major. In addition to those benefits, an undergraduate law major would allow legal education to retain the “option maximizer” aura that JD programs used to enjoy. BA’s with a law major could pursue the jobs open to other liberal arts graduates, as well as some of the “JD Advantage” jobs. These graduates could also, of course, choose to attend law school. A law major encompassing half of our current JD training wouldn’t allow graduates to “do anything,” but it would open numerous doors in the entry-level, post-college job market.
Under this framework, JD programs would offer two years of more advanced training. Those programs would lend themselves well to the specializations and blended classroom/workplace learning described above. Taken together, a BA+JD program would strike the right balance between options and specialization.
Applicants and Aspirations
December 2nd, 2013 / By Deborah J. Merritt
What will draw more students back to law school? Several writers have suggested that declining class sizes will attract more JD applicants. Smaller classes mean fewer graduates: If graduates decline, while jobs hold steady, then employment rates will improve. College graduates will take note and turn their attention back to law school.
Jacob Gershman, writing in the Wall Street Journal Law Blog, notes that if entering class sizes decline for just one more year, then the Class of 2017 may enjoy better employment rates than the Class of 2007 did. That sounds pretty promising, especially since Gershman limits his calculation to full-time jobs requiring bar passage. Will that degree of improvement attract more law school applicants?
It almost certainly will: An employment rate of 79.4% for the Class of 2017, using Gershman’s figures, is much more attractive than the 58.6% achieved by the Class of 2012. Several factors, however, counsel that applications will not rebound as far as employment rates. Here are three reasons why, all caveats that law schools should consider when planning strategically for the future.
Greater Transparency
Law schools published employment information in 2007, but not with the same transparency that the ABA and applicants require today. Many people are shocked to learn that, nine months after graduation, no more than 72% of the class of 2007 had obtained full-time jobs requiring bar admission. More than 10% of the class was unemployed, unaccounted for, or working in nonprofessional jobs like retail. Most of the remainder had secured “JD preferred” or “other professional” positions, but a substantial minority of that group was unhappy with their employment. 37.7% of the former group, and 39.6% of the latter, were seeking other jobs.
Those figures were available to applicants and professors who pressed for details in 2007, but we didn’t talk about the job market as frankly then as we do today. When projecting the behavior of future applicants, we have to remember that they operate in a world of more transparent employment figures. We have to ask: If applicants know that ten percent of them will be un- or under-employed with their JD, while another 18% will take jobs that do not require bar admission, how many will choose to attend law school?
Rising employment rates, in other words, will shed light on how much transparency matters. Did students flock to law school last decade because they were impressed with the actual employment rates of the period? Or did they misconstrue their odds in the employment market? I don’t know, and I don’t think anyone can know, but I think that improved transparency will depress applications at least somewhat. 2017 will not be 2007.
Different Jobs
Today’s transparency includes, not just employment figures, but detailed information about the kind of positions that law graduates obtain. Those positions have changed significantly since 2007, and potential applicants know about the shifts. Indeed, applicants may know more than the average law professor; we need to catch up with that knowledge if we’re going to plan effectively for the future.
In 2007, the largest law firms (those employing more than 500 lawyers) hired more than 4,745 new JD’s within nine months after graduation. For the Class of 2008, the number reached more than 5,193. I say “more than” for both of those years because several law schools, including BigLaw feeder Columbia, did not participate in NALP surveys at that time.
For the Class of 2012, these largest firms hired only 3,636 JD’s within nine months after graduation. That smaller number seems likely to persist. Corporate clients are handling more legal work in-house, while BigLaw firms are hiring outsourcers and contract attorneys for substantial portions of their routine work. Even some of those 3,636 BigLaw positions are no longer associate jobs; some are staff attorney positions. Market forces strongly suggest that these trends will continue.
Those trends, of course, create other job opportunities. In-house positions, document review work, and staff attorney jobs often require bar admission, so these are new “bar admission required” jobs. The jobs, however, are different from the ones available to the Class of 2007–and applicants will know that. Some applicants may find some of these jobs desirable, although the salaries are much lower. Others will not be interested in a “79% employment” rate that includes a significant number of part-time, short-term, or staff attorney positions. Once again, it’s hard to quantify the impact of these changes, but they almost certainly will reduce applications to some extent.
Constrained Choices
For at least a generation, the most attractive aspect of a JD may have been our promise of many employment options. Graduates could work for large firms or small ones; they could choose government or public interest work; they could apply their JD to politics, business, or other endeavors. Law school applicants tended to be high achievers with uncertain career goals; they were people who liked to maximize their options–and law school seemed like the greatest option maximizer of all.
For many graduates, these options proved elusive. Students at the top schools, or at the top of their class elsewhere, might have been able to choose from a full menu of careers. But most students at most schools faced more limited options. A student in the bottom half of the class never had the option of working as an associate at a BigLaw firm–unless the student attended one of the top law schools, had a strong personal connection, or possessed non-law experience that was both highly desirable and rare.
Regional firms were also picky; most students couldn’t simply “choose” to work at them. Government and public interest jobs were more available, but students often had to begin working in those positions early in law school; they couldn’t wait until graduation to discover an interest in prosecution or environmental policy work. I’ve taught at two top-50 law schools during the last 30 years; even during boom years, I knew students who struggled to find a single job–any job. They did not choose among a variety of positions.
The changing job market has narrowed choices further. At more than half of accredited law schools, associate positions in BigLaw are virtually unattainable. In 2012, 45 schools placed 0 graduates in the largest firms–not even in staff attorney positions. Another 67 schools placed 1-5 graduates in those firms, with an unknown number of those graduates taking staff-attorney or paralegal positions. (These figures derive from the ABA’s 2012 employment spreadsheet, which is available here. I do not include any of the Puerto Rico schools in my counts.).
Competition for jobs in all other categories is stiff. To secure those jobs, students often have to chart a careful course starting at the end of their first year. Working part-time for a future employer while gathering related experience in courses, externships, and clinics, often provides the best shot at a full-time job. Many students are happy with these jobs, but they do not choose from a wide menu of options.
Today’s law school applicants understand both these narrowed choices and how those choices are distributed among students at different law schools. This may be the greatest impact of transparency: Most law schools have lost their reputation as “choice maximizers.” A handful of top law schools can credibly offer their students a wide range of employment options. At most schools, however, the options are more constrained and students need to specialize early in their law school careers.
Swallowing the Pill
This truth, about narrowed options, may be the hardest pill for legal educators to swallow. Choice is deeply ingrained in our culture, and has been one of the most attractive selling points for law school. For many applicants, I suspect, the promise of choice mattered even more than high salaries. We all like the power to steer our own destiny.
As professors, our experience tends to perpetuate the notion that law school graduates choose among many career options. Most of us personally enjoyed a very wide range of entry-level job choices and career paths. We also see the overall employment patterns for our graduates, which suggest a large menu of jobs. The employment reports show so many different outcomes! It’s easy for us to believe that each of those graduates chose his or her job over all of the competing options.
Contacts with graduates who enjoy their work buttresses these beliefs. Former students rarely call to say, “I really wanted to do commercial litigation for a mid-sized firm, but the only work I could get was with a solo doing personal injury work”–although those calls and blog posts are becoming somewhat more common. Students are more likely to call when they are satisfied, or to describe their work as a chosen path. Unless we listen closely, we risk missing a key fact about today’s job market.
These trends–transparency, new jobs, and reduced options–mean that law schools cannot simply wait for applications to rise. We need to grapple with the forces that are reducing interest in legal education. What, specifically, should we do? I have a few ideas, which I’ll describe in my next post.
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