More than 50% of law school graduates from the 2011 class aren’t earning enough to buy a house, according to a new study [Jerry Organ (St. Thomas), Reflections on the Decreasing Affordability of Legal Education, 41 Wash. U. J.L. & Pol'y ___ (2013)]. ...
Mr. Organ took a formula for measuring a law school graduate’s economic viability developed by University of Louisville Law Professor Jim Chen
[A Degree of Practical Wisdom: The Ratio of Educational Debt to Income as a Basic Measurement of Law School Graduates’ Economic Viability, 38 Wm. Mitchell L. Rev. 1185 (2012)] and applied it to employment outcome data published on a per school
basis by the ABA for the class of 2011.
Graduates need to be earning an annual income that’s at least two
times their annual tuition — or an income that’s at least two-thirds of
their law school debt — to reach “marginal financial viability,”
according to the formula. Those below the threshold can’t afford to buy a
$100,000 house and struggle to retire their debt. ...
He concludes: Across all law schools and after accounting for
scholarships in the manner described above, the estimated percentage of
graduates from the Class of 2011 who have marginal financial viability
increased from roughly 33% to roughly 46.5%, while the
estimated percentage of such graduates who have less than marginal
financial viability declined from roughly 67% to roughly 53.5%.
Those facing the bleakest prospects are graduates with lower LSAT
scores and grade point averages who are more likely to pay full
tutition, and those who went to school in places where legal education
is more expensive, like California, Illinois, Massachusetts, and New
“Law schools are going to find themselves with fewer students to fill
their seats unless costs come down or the job market improves
significantly,” Mr. Organ told Law Blog by email.
To offer good financial
viability, defined as a ratio of education debt to annual income no
greater than 0.5, post-law school salary must exceed annual tuition by a
factor of 6 to 1. Adequate financial viability is realized when annual
salary matches or exceeds three years of law school tuition. A marginal,
arguably minimally acceptable level of financial viability requires a
salary that is equal to two years’ tuition. The following table compares
some tuition benchmarks with the salary needed to ensure the good,
adequate, and marginal levels of financial viability identified in this