Paul L. Caron

Thursday, September 6, 2018

Henderson: What Signal Are Legal Employers Sending To Legal Education?

Bill Henderson (Indiana), What Signal Are Legal Employers Sending to Legal Education?:

Practicing lawyers have long complained about the content of legal education – too much theory, not enough practical skills. If you’re one of those lawyers, do you also believe in the power of markets to improve the value of goods and services? If so, what market signal are legal employers sending to legal education?

As someone who has studied this market for more than 15 years, here is my paraphrase: “We want to hire smart, hardworking, and diverse law graduates, ideally from highly ranked national law schools or those at the top of their class at regional law schools.”

This describes how the majority of law firms, federal judges, and prestigious public interest employers sort through resumes. This is an observation, not a judgment. Information costs are high. Even for pedigree skeptics — and there are quite a few in the legal profession — the road of least resistance is to favor candidates with strong academic markers.

This leaves legal education in a bind – if we build it, you won’t come. Instead, legal education expends enormous energy, and a lot of scholarship dollars, to move up in a rankings competition where quality is determined primarily by pre-law credentials. Indeed, over the last 20 years, there has been a consistent .90+ correlation between schools’ median LSAT scores and their U.S. News rank. This is an input-driven market that does not materially reward improvements in legal education. How do we fix that?

If you are legal employer, here is a simple, low-risk way to send a powerful signal to law schools: Hire an IFLP intern.

IFLP (pronounced “I-flip”) is the Institute for the Future of Law Practice, a nonprofit created by innovative legal departments, law firms, legal service companies and law schools seeking to build a better talent pipeline. IFLP’s core initiative is a 3-week skills boot camp for law students followed by internships (10-week) and field placements (7-months) with IFLP employers. In 2018, 40+ students from five law schools participated in the program. In 2019, we hope to expand to 90+ students from 15 law schools. See 2019 IFLP Curriculum and Internship Program. The long-term goal is to make future IFLP curriculum and internships available to all interested law schools and law students.

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The market signal from legal employers and non-legal employers is pretty clear – we value JDs over grads with a terminal bachelor’s degree. According to NALP, over 90% of 2017 law grads were employed. The average salary of grads in bar passage required jobs was $98k, JD advantage jobs was $74k, and professional jobs was $82k. Those salaries far exceed the average salary of college grads. And the average salary of a law grad is nearly double the salary that a medical school grad earns in residency.

Posted by: market signal | Sep 6, 2018 3:53:21 PM

I'm sure market signal is aware - because I've told him several times now - that the real dollar median NALP starting salary is still about 20% less than it was in 2008, there are thousands fewer long-term, full-time, license-required entry level jobs now than there were in the worst years of the Great Recession and law school crisis, and of course the employment rate for four-year college grads is 97%. And comparing the average salary of law school grads with medical school residents is just as disingenuous and stupid as comparing the average salaries of surgeons with those of law school interns.

Posted by: Unemployed Northeastern | Sep 6, 2018 10:27:55 PM

Lets not overstate things.

Doctors may have modest salaries for a couple of years of residency and fellowship, but in the long run they earn more than most lawyers, on average.

Posted by: Overstate | Sep 7, 2018 10:01:00 AM

Let's not overstate things in the other direction either. Employment rates for law graduates are up across the board. There were more lawyers working last year than in any previous year.

There were fewer entry level hires only because there were fewer recent law graduates.

Posted by: Overstate | Sep 7, 2018 1:59:29 PM

Median salaries, lawyers:

Federal government: $141,900
Legal services: $120,280
Local government, excluding education and hospitals: $93,020
State government, excluding education and hospitals: $85,260

Median salaries, doctors:

Anesthesiologists: $265,990
Surgeons: $251,890
Obstetricians and gynecologists: $235,240
Psychiatrists: $216,090
Physicians and surgeons, all other: $211,390
Family and general practitioners: $208,560
Internists, general: $198,370
Pediatricians, general: $187,540

All stats from BLS. Thus concludes another lesson in Labor Economics 0.101.

Posted by: Unemployed Northeastern | Sep 8, 2018 9:54:58 PM

@ Market Signal – Let’s see, getting my handy dandy calculator out, seeing how the top undergrad accounting majors make about $65k, your JD grads make $33k more. But, and this is a big one, your JD grad had to spend say $250k to get that JD. Moreover, your JD grad will never get back three years of lost income. The numbers for a doc are even worse. Losing 10+ years of earnings, puts them in a major hole.

Here’s the reality. You should CHOOSE to go to law school because you want to become a lawyer. The economics comes into play when you consider affordability. You may want to become a lawyer, but the numbers don’t make sense. Simply put, the rent is too damn high.

Posted by: Dale Spradling | Sep 9, 2018 7:40:26 AM