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Monday, March 4, 2019

The New Normal In The Job Market For New Lawyers

Bernard A. Burk (formerly North Carolina), The New Normal Ten Years In: The Job Market For New Lawyers Today And What It Means For The Legal Academy Tomorrow, 12 Fla. Int’l L. Rev.___ (2019):

Despite record-low general unemployment and a strong economy, the graduating law-school Class of 2017 entered a much smaller and more constrained labor market than existed ten years before. Overall, the number of entry-level, strongly law-related jobs (“Law Jobs”) that the Class of 2017 obtained was 26% lower than the Class of 2007, and remains at levels not seen since the early 1990s. The only reason that greater proportions of the graduating class are obtaining Law Jobs than in recent years is the dramatic decrease in the number of students attending law school since 2010.

Burk

Examination of the various sectors of the entry-level Law-Jobs market shows that no sector produces more Law Jobs today than it did in 2007. That said, some sectors’ hiring shrank more than others. While there are fewer entry-level Law Jobs overall today than in 2007, there were no drastic changes in the non-law-firm sectors’ share of all Law Jobs or of the graduating class. Among private law firms, it is the smallest (2–10 lawyers) and the largest (over 500 lawyers) that have reduced their entry-level hiring least.

In addition, a look at the pattern of entry-level hiring in the ABA’s “JD Advantage” category (referring to jobs that are law-related but do not require a law license) provides quantitative evidence that many of these positions have long been, and remain, distinctly less preferred by and less satisfying to new graduates than conventional law practice. These findings call into doubt comments touting work that is merely law-related as the future of the profession, and suggest that most law schools would be wise to concentrate on preparing their students for practice.

For reasons explained in detail, there is no reason to believe that any of these patterns will change in the foreseeable future. Overall, this implies that the steady and rapid entry-level legal-employment growth common from the 1970s through the mid-2000s is over, and a stable “New Normal” has established itself. This New Normal likely will see only gradual growth in entry-level Law-Jobs hiring at rates roughly equal to the growth rates of the domestic population and economy—about 1%–3% per year overall.

These changes impose a straitened perspective on the recent increase in applicants to law school in the 2017–2018 admissions cycle, the first meaningful increase since 2010. Given that any substantial expansion in the need for new lawyers is unlikely, any continued improvement in the employment prospects of new law graduates at most law schools will be dependent on keeping entering-class size steady or making it smaller. Law schools that grow without a specific and quantifiable basis to predict commensurate expansion in particular labor markets that they directly serve risk diluting their graduates’ employment outcomes, with corresponding adverse effects on their life and career prospects, as well as the reputation of the institution.

Bernie Burk, New Study on the State of the Entry-Level Law-Jobs Market and its Implications (Part I: Where the Job Market for New Law Graduates is Today)

https://taxprof.typepad.com/taxprof_blog/2019/03/the-new-normal-in-the-job-market-for-new-lawyers.html

Legal Education, Scholarship | Permalink

Comments

Not every student attends law school to become a lawyer. Many students pursue a legal education to obtain employment in business and government. In fact, employers pay a wage premium to JD holders compared to non-JD holders. Take the USC graduating class of 2017 for instance. Graduates employed in business had mean salaries in excess of $80,000, far above the average salary earned by employees possessing only a terminal bachelor’s degree. Rather than shrinking classes, law schools should inform potential students of the benefits of a law degree. Law schools should reach out to students interested in business, policy, and government. A JD is more useful and pays a higher wage premium than an MBA, MPP, or MPA.

Posted by: Premium | Mar 4, 2019 3:43:39 PM

Isn't this over-education for the mere chance of a law job a natural response to high-paid hiring that is not very objectively skill based and often seems not to even try to be (i.e., a crapshoot)?

Posted by: Anand Desai | Mar 4, 2019 9:50:24 PM

- “Not every student attends law school to become a lawyer.” This is offensively glib and I can’t help but remember how no one in law school land ever ever ever said such drivel before command central determined that “versatility” was to be both buzzword and coping strategy for crashing employment outcomes.

- “Many students pursue a legal education to obtain employment in business and government” Nay, people who want to obtain employment in business or government get these things called MBAs and MPPs, both of which are cheaper and take less time to acquire than a JD.

- “Take the USC graduating class of 2017 for instance. Graduates employed in business had mean salaries in excess of $80,000, far above the average salary earned by employees possessing only a terminal bachelor’s degree… A JD is more useful and pays a higher wage premium than an MBA, MPP, or MPA.” Tsk tsk, you should have spent three seconds Googling that, friend. That’s how long it took to find that the USC Marshall School of Business’s grads enjoy a mean $115,309 (with an additional average $23,241 signing bonus) starting salary. Math quiz! Is ($115k + $23k) more or less than $80k? This scales up, too: the IB, VC, PE, and F500 CEOs out of the likes of HBS earn several magnitudes more than even the Vaultiest law firm partners from HLS.


- Speaking of not-at-all-coincidentally-chosen law schools like USC, I can’t help but notice that the median starting salary for Seton Hall grads is $53,810, which just a few thousand dollars higher than the average starting salary for four-year college graduates regardless of major according to the National Association of Colleges and Employers.

- One more thing: in 2008 the median starting salary per NALP was $72,000, which the BLS inflation calculator informs me is worth $84,875 in today’s dollars. Too bad NALP found that the median starting salary in 2017 was $70,000. Still 10% lower in real dollars 10 years on, even despite the >50% increase in sticker tuition at many law schools since 2008. Ouch.

Posted by: Unemployed Northeastern | Mar 6, 2019 7:57:39 AM

In case my longer comment gets *lost* again, I'll just point out that the average starting salary for USC's business school is $113k with a $23k signing bonus. As this is >50% higher than $80k, Premium' contention that a (USC) JD has a greater wage premium than a (USC) MBA is... ringing false.

Posted by: Unemployed Northeastern | Mar 6, 2019 8:00:06 AM