Paul L. Caron

Thursday, June 28, 2012

Henderson: Higher-Pay Law Office Jobs Shrink, While Lower-Pay Legal Services Jobs Expand

The Legal Whiteboard:  More Job Market Data Showing a Structural Shift, by William D. Henderson (Indiana):

The U.S. Census Bureau just released its 2010 data for the County Business Patterns (CBP) dataset. ... The news for the legal sector is not good.  Law Offices ..., which comprise 93.1% of the U.S. legal services industry, shrank by 21,600 jobs between 2009 and 2010.  ...


... [T]he chart below compares Law Offices to All Other Legal Services:


"All Other Legal Services" seems to be doing pretty well, adding jobs while the number law office jobs declines.  What is in "All Other Legal Services"?  Almost certainly registry services for contract lawyers (doing e-discovery on a temp basis) and the domestic operations of legal process outsourcers.  See here.  The average job in this sector pays less than $46,000 per year compared to $79,900 in the law office sector.

What does all this mean?  For law firms, it means a brutal competition over marketshare.  Survival will require innovation. Yet, many lawyers are in denial.  For law schools, it means the same thing -- there are too many law graduates chasing after a shrinking number of opportunities.  ...  For additional analysis, see The Hard Business Problems Facing U.S. Law Faculty.

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And yet there's little evidence that attorney wages are declining.

There's a tiny drop in the huge law office market, and huge percent--but still tiny--increase in the other legal jobs.

Is this a "structural shift." Or a tiny, insignificant fluctuation?

Posted by: Anon | Jun 28, 2012 8:18:24 PM