TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, November 24, 2014

'These [Law] Jobs are Going Boys and They Ain’t Coming Back'

SpringsteenDavid Barnhizer (Cleveland State), “These Jobs are Going Boys and They Ain’t Coming Back” [Bruce Springsteen, My Hometown]:

Lawyers and law schools reflect the needs of society and the power and structure of our economic system. At this point lawyers and law schools need to adapt the ways in which they “do business” or become uncompetitive. Lawyers and law schools are faced with economic and technological “tsunamis” in the nature of Joseph Schumpeter’s concept of “creative destruction” or Nikolai Kondratiev’s periodic “waves” of fundamental change. These transformational “events” generate non-linear shifts in form, process and needs that fundamentally alter how the system works. These dynamic forces are now destroying some traditionally organized institutions while empowering others and forcing the invention of new institutions and altered forms of traditional ones.

Projections of the future employment opportunities of lawyers tend to be both linear and crude, relying primarily on taking “what is” or what “has been” and assuming that some variation of that model will be what occurs in the future after what has been described as the “lawyer surplus” has been absorbed. Such assumptions and projections provide a degree of comfort to those whose livelihoods and careers depend on the stability of existing institutions and patterns of organization. Unfortunately, in the situation we now inhabit the assumptions are false and the projections inaccurate. The most recent “tweaking” of lawyer employment projections by the Bureau of Labor Statistics that raised its own estimates from around 23,000 to 40,000 will make many people feel better for a few moments but the fact is that it is almost certainly wrong.

Matt Leichter recently offered an analysis on whether the employment situation was getting better or worse. Unfortunately the answer Leichter offered was summed up in his report that the situation was becoming considerably worse rather than improving. In linking to Leichter’s report Paul Caron noted that the surplus was worsening and that there would be three new lawyers chasing each available job by 2022.

The fact is that the worlds of lawyers and law schools are “spinning on their axes” and undergoing transformations that are penetrating the very core of the activity. Dramatic effects are already being felt but even more striking changes are in store. One individual employed by a company seeking to understand (and capitalize) on the shifting context of law practice began his assessment with an observation of the current state of the legal profession. He described it as one in which: “The current state of the legal services industry is one of fear, denial, distrust and unmet expectations. Lawyers are asking if they ever thought law practice would reveal such fault lines in purpose, mission and economic opportunity. … Massive job losses, significant declines in legal service revenues and increased hostility toward the business model on which legal services are based are mere warning signs of a tsunami of change rapidly approaching the shore. What remains beyond debate is that the business of law has lost its luster and the legal industry landscape is littered with unmet expectations on the part of clients and lawyers alike.” Pretty dismal. ...

It seems stunningly obvious that much of the demand for lawyers as traditionally constituted is going the way of bank tellers, telephone operators, gas station attendants, grocery store check out clerks, receptionists and more. Projections about the numbers of lawyers and law graduates that might be needed five, ten or fifteen years from now are simply not taking these changes into account.

I have seen various projections about surpluses and the numbers of traditional new law jobs that could be available annually due to newly created positions, and assumptions about deaths and retirements, ranging from around 40,000 per year down to the neighborhood of 20,000. My “guess” is that the probable number is likely to be closer to 15,000-17,000. This obviously has important implications for law schools as currently constituted as well as the legal profession. My estimate is clearly based on a combination of fortune-telling, interpretation of the impacts of technology on what lawyers do as well as vastly increased access by intelligent non-lawyers to the “decoded mysteries” of law and the ability to accomplish many of the “bread and butter” tasks on which numerous lawyers depended for clients. Another likelihood is that we will see some truly entrepreneurial lawyers create what might be called a law firm or at least a legal services provider that employs a limited number of “real” lawyers as supervisors or monitors who “sign off” on the work of non-lawyer staff to “keep things official” but that alter dramatically the actual nature of the entities supplying legal services.

The “Walmart Law” development in Canada and the equivalent “Tesco Law” in the UK in which very large and well-funded commercial entities decided to offer legal and financial services are likely to dramatically undermine the current structure of law practice. Other than some unjustified market barriers erected to protect US lawyers there is no rational reason to expect that these approaches to offering legal services will not ultimately “invade” the United States.   Nor in reality is it required that the American legal profession alter its restrictive rules. We will see an increasing amount of legal work in various forms being outsourced to Asian and European bases of operation. There will be no real way for state and local bars to know what is going on and a significant amount of work will be performed outside the country.

The evolution of software that can analyze and synthesize data with the ability to generate sophisticated written materials will further marginalize or eliminate the need for some lawyers. This also has important implications for the existence of extensive legal writing programs in law schools because if what is needed can be done at the “push of a button” by either a lawyer or an educated layperson the time and training now devoted to teaching students these processes comes into question.

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