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Monday, September 24, 2007

WSJ: End of Law School "Golden Era"?

Sobering front-page article in today's Wall Street Journal:  Crowded Bar:  A Stingier Job Market Awaits New Attorneys; Growth of Legal Sector Lags Broader Economy; Law Schools Proliferate, by Amir Efrati:

A law degree isn't necessarily a license to print money these days. For graduates of elite law schools, prospects have never been better. Big law firms this year boosted their starting salaries to as high as $160,000. But the majority of law-school graduates are suffering from a supply-and-demand imbalance that's suppressing pay and job growth. The result: Graduates who don't score at the top of their class are struggling to find well-paying jobs to make payments on law-school debts that can exceed $100,000. Some are taking temporary contract work, reviewing documents for as little as $20 an hour, without benefits. And many are blaming their law schools for failing to warn them about the dark side of the job market. ...

The law degree that Scott Bullock gained in 2005 from Seton Hall University -- where he says he ranked in the top third of his class -- is a "waste," he says. Some former high-school friends are earning considerably more as plumbers and electricians than the $50,000-a-year Mr. Bullock is making as a personal-injury attorney in Manhattan. To boot, he is paying off $118,000 in law-school debt. ...

Many students "simply cannot earn enough income after graduation to support the debt they incur," wrote Richard Matasar, dean of New York Law School, in 2005, concluding that, "We may be reaching the end of a golden era for law schools."

See also WSJ Law Blog:  The Dark Side of the Legal Job Market, by Amir Efrati.

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Comments

Funny how things haven't changed. I graduated from law school in 1992 and the WSJ had a very similar article back then. At least my debt was only 10k instead of 100k plus. Times were indeed tough. I limped along at $20k a year for a few years before things came together.

Moral of the story, and it's been true for a long time: don't go to law school to get rich, but because you want to practice law. At some point you'll be all right if you focus on practice rather than money. The money comes eventually.

Posted by: R.V. Bottomly | Sep 24, 2007 1:00:28 PM

Not a minute too soon. Let's hope that more people go into more productive work.(160k for a first year associate is obscene.)

Posted by: clarice | Sep 24, 2007 1:06:19 PM

Lawyers in poverty? I can go for that. Let's just hope they don't find a way to make money on my back.

Posted by: Dr. Ellen | Sep 24, 2007 1:10:46 PM

Wow. This reminds me of the sob stories we got about the poor UAW members out of work in the '80's. The poor family of four that might have to give up their five cars, the cabin at the lake, their Tigers season tickets.... all the necessities of life. Any law school graduate who hadn't figured out that we have at least twice as many personal injury lawyers as we need is too dumb to be admitted to the bar. And any lawyer who hasn't figured out that his earning potential will increase much faster than his plumber and carpenter friends needed a lot more economics in college. I cannot get too excited that lawyers aren't making the money they think they're worth.

How about we raise the requirements to get a law license? Maybe we should enforce ethics among attorneys instead of allowing "self-policing" by bar associations? Perhaps require lawyers to renew their licenses every once in a while?

Color me totally unimpressed with the plight of poor law school grads while seeing for a third time this hour a commercial by an ambulance chaser trolling for class action clients on television.

Posted by: Ken Hahn | Sep 24, 2007 1:24:37 PM

It's not just lawyers. Look at the value of a Computer Science degree these days. What has changed is the cost of higher education. It has vastly outstripped inflation.

Is a college degree the next bubble, after tech and housing? A lot of them are certainly not indicative of much.

Posted by: MarkD | Sep 24, 2007 1:28:01 PM

If that kid is taken by surprise that graduating in the top 30% from Seton Hall isnt worth much he deserves to be a Court Street ambulance chaser. He says it was a waste of time, but maybe he just wasted his time instead of studying to make the top 10%. And then he blames the school for not holding his hand and warning him. Classic.

Posted by: student who works hard | Sep 24, 2007 1:30:13 PM

It's a first step. Poor lawyers equals fewer lawyers. All we need is a 99.999% reduction in the number of lawyers and we'd be fine. I mean I like the guys in the defence bar and corporate advisory, but they'd do much more for the world if they could generate ideas rather than just fending off the John Edwards' of the world.

Perhaps the best idea would be to require 5 years of service demining in Africa or Afghanistan before being able to take the bar exam!

Posted by: Hey | Sep 24, 2007 1:34:15 PM

Several of my relatives who are tradesmen make considerably more than me, it doesn't mean my education was a waste. They were diligent, worked hard for those 4 years I was in school (or more for people with advanced degrees), and started their own businesses. I wonder if this kid's friends are the same.

That's how life always has been. If you don't work hard you won't succeed. Getting a piece of paper doesn't mean you deserve to be paid more.

Posted by: chirsb | Sep 24, 2007 1:38:02 PM

"...many are blaming their law schools for failing to warn them about the dark side of the job market. ..."

so clearly, the lawyerly thing to do would be to sue your law school

Posted by: Dean | Sep 24, 2007 1:41:13 PM

I'm sorry, I can't sympathy for people making 'only' 50k a year starting.

People have that degree for their whole life. Things will improve, eventually, if they keep at it. In the meantime, $20/hour will definately pay the bills.

Posted by: John Lynch | Sep 24, 2007 2:24:15 PM

Lawyers suffer as the economy suffers: manufacturers are leaving for less litigious, cheaper and welcoming locations not choked with union work rules. Going with them is their legal work. There is less of it around now. That's bad for us all.

It was such fun for courts and politicians to punce on the golden geese: plant closing laws; pollution enforcement ratcheted up to new levels each year so no one can build a refinery anywhere; class actions aginst gun makers for deaths caused by criminals no one will lock up for good; hostile environment claims by people who felt "discriminated against" because someone else was...; "we'll tell you how to run your business!" ...yup it all comes home to roost.

Wanna be lawyers also aren't being realistic: a law practice is hard work and takes time. Lawyers at big firms really earn those salaries, often 7 days a week. So this guy from Seton Hall really thought a huge firm would hire him? Why? Based on "upper third" status? Did he never talk to a single lawyer or senior law student in his time at Seton Hall to see what the market was like?

That is as naive as the hordes of Ph.D's in "Psychology" or "sociology" that flood out of universities each year to find . . .lots of other unemployed PhD's.

My sympathies. It wasn't that easy in the 1970's either. But if he wants to try, cream always rises to the top. And persistence pays off in the real world. So if he wnats to be a lawyer, sit in an office and get paid for saying "I object!" instead of being a "rude tradesman," here's my advice: ..get to work. The work is there. Its harder to find. But I know lots of people that graduated in the lower tiers and did very well. I also know plumbers that opened franchises and out earn most lawyers. They deserve it too. Welcome to the free market!

Posted by: LALawyer | Sep 24, 2007 3:01:41 PM

Aw, poor Bullock. Can't make it suing people who trip and fall in New York? Cry me a river.

Posted by: NYC guy | Sep 24, 2007 3:20:50 PM

As my Dad says, Austin, TX has the highest educated wait staff in the world.

College kids should not bankrupt themselves for an education.

Posted by: Stormy70 | Sep 24, 2007 4:55:33 PM

This kind of article comes out fairly often for every group. It's sort of "I worked so hard in school so why aren't I being paid enough to think of myself as rich" mind-set.
When I became an architect, the same racket was (and still is) being raised about that profession with special complaints being directed toward having not been warned by the school. Since when is it part of the educator's responsibility to provide a guarantee that the poor little student will gain a lifetime of financial security in trade for a few years of laid back semi-struggle in academia?
Oh yeah! I suspect one can find "starving" plumbers and destitute electricians too.
I have been wildly unsuccessful on the business side of this profession, but can think of nothing that I'd rather have done for the past thirty five years. That is worth something.
Woody

Posted by: Oran Woody | Sep 24, 2007 5:19:08 PM

What one should do is engage in rational economic analysis before going to law school. Decide what you are looking to do for a job when you are done, see what it takes to get that job, then make a rational decision about what tuition level that job is worth.

It is amazing how many smart people are totally irrational in making personal decisions. Read some stories by people who went to law school and then discovered that, after graduating, they hated law (heck, read "The Associates", or "The Paper Chase"). Apparently they were thinking it was all about Perry Mason or Matlock, not 70 hours a week generating billable hours as an associate. None of this is a secret.

Posted by: Kurmudge | Sep 24, 2007 6:26:05 PM

Borrowing $100k to attend a non-top 10 school, intending to get a job in a big law firm, and then not working as hard as possible to get awesome grades relative to anyone else is, well, an example of not planning correctly. If you don't have exceptionally wealthy and generous parents, or a full-ride scholarship, you had better be either incredibly gifted or incredibly hard working or, preferably, both.

My mom graduated from a fourth tier law school a year or so ago, and while she's never going to get rich doing it, there's plenty of work for her to do. It means covering four rural counties (with more ready for future expansion) and taking mostly GAL and court-appointed defense stuff, but it's work. And she has just enough time to teach in a paralegal course at a local community college on the side.

I still haven't decided whether or not to go to law school myself -- I could get a free ride in the fourth tier (thank you, LSAC, for pushing standardized testing,) but I'd rather be in academia and I don't want to deal with compulsive liars and bureaucratic nonsense, which is half of what practicing attorneys seem to work with every day.

Posted by: Sarah | Sep 24, 2007 6:30:59 PM

I'm struggling to see a downside to this. In fact, I feel more and more vindicated that I majored in Computer Science and became a software engineer, as opposed to going into law.

One of the obvious long-term advantages of majoring in an engineering or business field is that unlike lawyers, who are dependent on the legal system, you will get the background you need to make your own opportunities when none exist.

Posted by: MikeT | Sep 24, 2007 10:58:31 PM