October 11, 2011
One prof says going to law school is still a very good investment
The plight of new lawyers in this economy has been a topic of frequent discussion. According to the National Association for Law Placement, “class of 2010 graduates faced [the] worst job market since [the] mid-1990s.” Only 87.6 percent of graduates in that class were employed within nine months after graduating — the lowest rate since 1996, and down from 91.9 percent in 2007. Again, lawyers are not immune to the effects of larger economic malaise — new lawyers less so. In fact, the 1996 rate was in the aftermath of the recession of the early 1990s. But these statistics show that even in bad times, the vast majority of law school graduates secure employment shortly after graduation. Moreover, logic dictates that employment rates increase with the passage of time, and history dictates that bad times don’t last forever.
Salary data show that the vast majority of lawyers earn relatively high salaries. According to the U.S. Census Bureau, lawyers boast the fourth highest median salary behind medical doctors, dentists and CEOs (some of whom have law degrees). While the majority of occupations have median salaries between $20,000 and $49,999, the median for lawyers in 2010 was almost $113,000. Again, this was the median — the actual midpoint — which means the majority of lawyers made six-figures.
Predictably, starting salaries for new lawyers tend to fall below the median for the profession as a whole, but they still tend to be relatively high. According to NALP, the class of 2010 had a median starting salary of $63,000, a respectable living for a new entrant into any profession. On the downside, the 2010 median was $9,000 lower than the year before. But declining wages have buffeted the entire economy. Fortunately, as the economy sputters back to life, salaries are unlikely to continue falling at the same rate — if at all.
The decline in salaries for new lawyers is attributed in part to a decline in private-practice jobs. About 21 percent of 2010 graduates got jobs in large law firms, compared to about 26 percent in 2009. Because these jobs are among the highest paying — typically starting well above $100,000 — the decline in this sector affected overall salary data for new graduates. This shift, however, does not render law school a bad investment. Even with the 5 percent decrease in BigLaw jobs, the overall employment rate for graduates fell less than 1 percent between 2009 (88.3 percent) and 2010 (87.6 percent). Again, the vast majority of law school graduates find employment paying relatively high salaries — even if it’s not the type glamorized by popular culture.
. . . .In terms of outlook, there is some optimism that the legal job market is thawing, albeit slowly. The legal sector has added about 900 jobs so far in 2011. Law schools are reporting increased employer participation in on-campus interviews. And there are signs that law firm hiring will increase in 2012. The U.S. Department of Labor projects that jobs for lawyers will grow about as fast as jobs overall. So larger economic trends will influence, if not determine, the speed at which the legal job market recovers. But one thing seems certain: workers with legal training will fare better than most in this economy, no matter what happens. According to the U.S. Department of Labor, lawyers make up one of the 10 smallest professions. This finding calls into question the “too many lawyers” memo, especially when you consider the prominence of the legal process in this country. In reality, lawyers are still relative rare — and with rarity comes demand and a wage premium.
Continue reading here.
October 11, 2011 | Permalink