The Next Lawyer Bubble: Why Law Schools Are Doomed to Fail
September 23, 2022
Law schools are in trouble. They’re at risk of creating another lawyer bubble that will soon burst in the legal job market. Every year, law schools admit thousands of students who have no intention of being real lawyers,
but rather see law school as a way to get their foot in the door at an investment bank or consulting firm. This creates a huge oversupply of lawyers, who then take low-paying jobs because there are so many lawyers flooding the market with similar skills and experience.
What if law schools are doomed?
All schools strive for a good job placement record, but the reality is that around 85% of JD recipients are now employed in positions that do not require a law degree.
That rate hasn’t increased since the 2008 recession. Even before the legal market started tanking, The Wall Street Journal reported that 90% of lawyers who graduate from accredited schools in 2015 were not getting jobs in law firms.
With over 1 million people trying to get into one of just 200-300 spots at top programs and fierce competition on the number of students they can enroll, it’s easy to see why law schools are struggling with finding well-paying jobs for their graduates and no end in sight.
Many of these graduates did not know what they wanted to do with their lives and chose law school because they saw it as a way to pay off $200,000 of debt while figuring out their career path.
Unfortunately, law schools have been encouraging less-than-desirable students into careers that are extremely competitive while simultaneously piling on more debt. With applicants coming from poorer families than before, particularly international students who don’t have legal status in most countries, finding meaningful work is nearly impossible.
Many are forced into community service jobs at firms with no intention of hiring them as lawyers for them to continue receiving visas. There’s also an increasing trend among public interest groups to push people away from law altogether and into other careers that would be better for society.
How can law schools fix their situation?
Law schools are doomed for a multitude of reasons, but perhaps the most salient is that they are disincentivizing the types of jobs and careers that law school students aspire to. The cost of tuition is simply too high, requiring students to take on excessive debt at a time when the demand for lawyers in many industries is shrinking. Additionally,
law companies are disinclined from recruiting people straight out of law school because there is too much variability with new hires, who may turn out not to be as skilled as employers had hoped. This is the souring labor market condition that employment experts refer to.
Finally, state governments are making matters worse by reducing funding for public interest work and nonprofits, which were traditionally safety valves for frustrated career seekers hoping for an opportunity in social justice work.
Will the legal job market improve?
In 2013, the Bureau of Labor Statistics projected a need for 1.2 million more jobs in the decade, a 14% increase from 2012. Assuming that one million new lawyers are added over this time frame, law schools will have produced enough lawyers to fill 68% of the projected vacancies.
However, what happens when law employers face another recession and do not find work for nearly as many new graduates? Unlike 2001-2003 when demand for lawyers was down only marginally and the attrition rate at firms was much lower than now, it is hard to believe that firms will continue investing heavily in an uncertain future where redundancies are likely.
Is there an opportunity for lawyers in the future?
Lawyers and law schools will always be necessary. The legal field is the one profession that is continually in demand. However, there’s a difference between how many lawyers are necessary now versus how many will be necessary for the future.
With the potential for drastic changes in our economy, most of these low rates are going up because of supply and demand laws, meaning that there will be fewer jobs for all attorneys, not just new ones. Furthermore, due to globalization and technological advances occurring in other professions,
it’s no longer as challenging for a non-lawyer to practice a profession such as accounting. Some estimates say up to 46% of Americans could soon do some form of work that used to require law degrees by 2020– this means even fewer jobs available for lawyers themselves.
What about alternatives?
While many in the legal field seem convinced that law schools are doomed, the reality is that there are many alternatives to earning a law degree. Many people who have a degree in an unrelated field of study pursue careers as paralegals and litigation assistants.
These individuals receive on-the-job training while earning an average salary of $60,000 annually. In other cases, students may choose to attend evening classes at community colleges or full-time bachelor’s degree programs such as criminal justice or pre-law. These options can significantly reduce a student’s debt and help them avoid being caught up in another potential bubble.
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