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Saturday, June 29, 2013

Silver Linings Law School Playbook: Competition Over Full-Time, Professional Law-Related Job Placement

The Legal Whiteboard:  The Competition is for Full-Time, Professional Law-Related Jobs, Part I, by William D. Henderson (Indiana):

NALP recently released the employment outcome data for the class of 2012. The good news is that the absolute number of JD Bar Passage Required jobs went up from the prior year. The bad news is that a significantly larger class of entry-level lawyers were competing for those jobs. The class of 2011 totaled 41,623, versus 44,339 in 2012 (+2,716, or +6.5%). And note, the class of 2013 is likely to be even bigger -- roughly +1.6% based on the size of the entering 1L classes in the fall of 2010 (see ABA enrollment data). Setting aside the year-over-year flucuations, the trendlines suggest a relatively large and persistent shortfall in the number of full-time, professional law-related jobs.


... [A] market correction is clearly underway. ... [C]an we conclude that the market correction will be complete when the relatively small class of 2017 enters the job market four years from now?  I certainly think the smaller number of graduates will help.  But I would argue that two things have fundamentally changed:

  1. Revenues versus credentials. Law schools are struggling with the need to balance their desire to hang onto respectable LSAT/UGPA medians with a need to generate sufficient revenue to cover their operating costs. ...
  2. Competition over full-time, professional law-related jobs. If there is one silver lining that has emerged from this troubled period of U.S. legal education, it is the willingness of the ABA to collect and publish more granular employment outcome data at the law school level.  In turn, U.S. News has incorporated this data into its rankings formula.  Instead of propping up our rankings by hiring our own students or benefiting when they got jobs nine months out working as a retail manager or a cab driver, under the new 2013 U.S. News rankings formula, only full-time, long-term jobs that are JD Bar Passage Required or JD Advantaged are given "full weight."

It is this second point that is going to push change in how law schools do business -- we now have an employment outcome in which the ranking payoff is now fully in allignment with what law students want -- full-time, professional law-related jobs.

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I do not think incentives are fully alligned with the jobs US News counts fully. Do law students really want these jobs for example offered by William and Mary? See the asterix at the bottom explaining how they came up with their median $50,000 salary (based on 7 reported salaries) in the public sector: "Salary information does not include information for the approximately 40 employed graduates in the Class of 2012 receiving stipends at an annual rate of $20,000 through the William and Mary Post-Graduate Public Service Program" But these jobs are counted fully in the US News numbers, and presumably disappear after a year.

So US News still does not have it right.

Posted by: Bob Loblaw | Jun 30, 2013 7:47:01 AM