Sunday, November 29, 2015

The UK's Apprenticeship Levy -- a helpful reset to the legal labor market?

LawsocietyThe Law Society Gazette reports a new apprenticeship levy that will be imposed in 2017 on UK employers with more than £3 million in payroll.  The Gazette notes that the levy, which totals .5% of payroll, will sweep in nearly 200 legal employers. 

The program has a potentially clever twist that could prove to be an effective economic stimulus for the UK economy. Employers get a credit for the cost of their current apprenticeship programs.  For the UK legal industry, this means that the bigger firms will be fully paid up just by running their current training contract programs. Yet, the article also notes that "the levy may force a number of firms to develop apprenticeship programmes so that they get their money back."

This is an idea that draws on both liberal and conservative principles.  It's liberal because it mandates, through a tax, a strong national policy that favors human capital creation. Yet, it's also conservative because it lets employers opt out of the tax by running their own apprenticeship programs.  The result is an increase in paid entry-level training for young people and, invariably, some infrastructure being developed around ongoing apprenticeship programs, likely from nonprofits and trade associations who serve or orbit around specific industries. 

In the United States, there are roughly 3,000 law firm employers with a payroll of $5 million or more.  They account for roughly half of the $91 billion annual payroll of all US law firms (NAICS 541110 Offices of Lawyers).  Many law firms are not hiring because client demand is sluggish and it's perceived as more cost effective to use senior personnel who are already trained.  As a result, the US legal profession is graying significantly.  See Is the Legal Profession Showing Its Age, LWB, Oct 12, 2014; What is Driving the Demographic Gap between BigLaw Leaders and their CEO/GC Clients?, LWB, Sept 1. 2015.  

Consider the benefits of a program like this operating in the US.  A .5% apprenticeship levy on $45 billion would mean that no less than $225 million per year would be invested in entry-level training contracts in the legal field, with a significant number of legal employers getting off the sidelines to create their own programs.  Astute bar associations would likely step in to provide logistical and administrative support.  Further, the US Department of Labor already has a detailed legal framework around apprenticeships.

With this kind of financial and administrative support, it is plausible to imagine the US legal profession moving to a true apprenticeship model where training contracts replace the 3L year of law school.  I acknowledge this all sounds very fanciful, but a relatively modest employer apprenticeship tax may be better national policy that asking young people to take on more education-related debt. 

November 29, 2015 in Current events, Innovations in law, New and Noteworthy, Structural change | Permalink | Comments (0)

Sunday, November 22, 2015

What is the impact of longer hours on lawyer satisfaction?

Every lawyer, law professor, law student, and legal commentator has an opinion on this question. Today we can test our views against actual data. 

IndianaLawyerThis fall, Lawyer Metrics was given the opportunity to analyze survey data supplied to us from by The Indiana Lawyer, the paper of record for the Indiana legal profession.  The sample included 516 respondents drawn from the paper's readership.  My colleague at Lawyer Metrics, Evan Parker, sliced and diced the data in a way the gave us some useful insights into the hours/satisfaction question, at least for a broad swath of lawyers in one midwestern state.

Below is a graphic that shows the average level of satisfaction on various dimensions for Indiana lawyers working 60+ hours per week.  


After the jump are graphs showing averages for lawyers working fewer hours per week.  But before clicking on the hyperlink, answer this question: Are Indiana lawyers with more moderate schedules on average more satisfied or less satisfied than their 60+ hour counterparts? Also, be a good sport and write down your reason why.  

Continue reading

November 22, 2015 in Blog posts worth reading, Data on the profession, Fun and Learning in the classroom | Permalink | Comments (0)

Monday, November 16, 2015

A Critical, Existential, Sisyphus-ean View of Business Associations (and Maybe Lawyering)....

Nekyia_Staatliche_Antikensammlungen_1494_n2I'm participating this week in a micro-symposium sponsored by the AALS Section on Agency, Partnership, LLCs, and Unincorporated Associations, taking place online at our sister Business Law Prof Blog. The topic concerns alternative business structures, and whether their focus on private ordering (in comparison to the corporate form) is good, bad, or indifferent.  Other participants include Joan MacLeod Heminway, Dan Kleinberger, Mohsen Manesh, and Sandra Miller.

My contribution is first up.  I would call it ... grumpy.

If I were being more charitable, I would call it "existentially-influenced."  Larry Solum posted one of his "Lexicon" entries yesterday on binaries and scalars in the law, and it gave me pause.  For somebody who's spent a career creating complex structures - corporations, partnerships, LLCs, contracts, mergers - on paper, I'm hardly overwhelmed by their significance.  (In highfalutin terms, I'm skeptical on an ontological basis.)  In my usual fashion, as I was walking the dogs this morning, and thinking just what I did believe was important, I decided it was the fact that we have to decide over and and over and over again what to do.  The relevance of this to contracts and business forms is that, having created them, they only marginally limit the fact that we have to keep deciding over and over and over again what to do.

Then, like a flash it dawned on me!  Binaries and scalars.  Is our consciousness, the place where we do that deciding, in physics terminology, a wave (i.e. metaphorically scalar) or a series of particles (metaphorically binary)?  True to the quantum insight, I decided it was both (even though the dogs were clearly alive at the time).  

That is, life feels like it flows along classically, according to the structures (like contracts and corporations) we build, but in fact it is a series of discrete yes-no moments in which we are deciding at every one of them to do or not to do (just as now I am deciding not to grade term papers and instead am procrastinating with useless cogitation).

Why spend so much time creating the structures if I'm so cynical about them? That's the Sisyphus part. Hey, pushing the boulder up the hill is a living.  But I do get to think about it while walking down to pick it up again.

November 16, 2015 | Permalink | Comments (0)

Sunday, November 15, 2015

The Power of Focus

Several years ago an Indiana Law alum told me about a video on the Internet that I needed to watch. It was a 1997 Q&A session with Steve Jobs at a conference of Apple developers.  Jobs had been fired by the Apple board 12 years earlier but at the time of the video had just been rehired to help turn the company around.  

"It's amazing because Jobs essentially describes cloud computing and smartphones nearly a decade before they had entered the market," the alum, who was very successful in business, told me. "To turn them into actual products, Jobs talks about the power of focus and the necessity of always working backwards from the customer. This video is important because it reveals the Jobs playbook before anyone knew it was actually going to work."

Back in my home office, I watched the video several times.  And every six months or so I have watched it again (like this morning) to help me evaluate the extent to which I have internalize the core insights.  As it turns out, focus and working backwards from students and clients is not my natural mode of thinking. Fortunately, as the video suggests, Jobs developed this mindset through the gradual process of trial and error. In short, it was learned.

The November issue of The American Lawyer contains an essay where I review the Jobs video and apply its core insights to the struggle over market share that is enveloping the large law firm sector.  I think my essay is good, but the video itself is timeless.  Hence, I am posting the video on The Legal Whiteboard.  If you are interested in why most things fail, but a handful of things succeed in a really big way, I encourage you to watch it.


(H/T Pete Yonkman, Indiana Law '98).

November 15, 2015 in Blog posts worth reading, Cross industry comparisons, Video interviews | Permalink | Comments (0)

Monday, November 9, 2015

Part IV: Alumni Surveys, The Varied Career Paths of Law School Graduates

This is Part IV of a blog series that focuses on alumni surveys based on data for Northeastern Law alumni who graduated between 1971 and 2012 (n = 833, 21% response rate).  Prior posts covered data related to the pre-law (Part II) and law school (Part III) experience.  This final installment summarizes data on the careers of Northeastern alumni. 

Varied Careers

One of the most significant post-law school findings from the Northeastern alumni survey is the sheer breadth of careers.  Sure, we all know in a general sense that lawyers have very diverse careers, yet I found the sheer magnitude of that diversity both striking and surprising.

Below is a graphic that summarizes the percentage of Northeastern alumni who have worked in a particular practice settings,by decade of graduation.

% Alumni/ae who have worked in Practice Setting, by Decade of Graduation


To interpret this graphic [click on to enlarge], it is important to understand the composition of the underlying data.  The survey question asks, “Describe your previous employment history starting with your most recent employer first.”  Some graduates have only one job to report -- the one they started after graduation; others have had many.  These jobs are then classified by practice setting and binned into the six categories shown in the above graphic.  Note that bars total well beyond 100%. Why?  Because alumni are changing not just jobs, but also practice settings—on average, at least once, but sometimes two, three, or even four times over the course of several decades.

The graphic above conveys several significant pieces of information:

General point.  Legal careers are extremely varied.  As it has tightened up, the entry level market has become an area of intense scrutiny, and rightly so because it affects early career lawyers and law school applicant volume.  In contrast, the chart above reflects the longer view. It suggests that very able, motivated people who attend law school go on to varied careers that no one could have predicted at the time of enrollment, including--most significantly--the entering student.  These generational cohorts are a versatile group that comprise a disproportionate number of leaders in industry, government, and the nonprofit world.  Law schools cannot take full credit for this; we admit people of enormous potential.  Yet many alumni tell me that their legal training and knowledge has given them an enormous leg up. One law grad who is now a successful business executive recently asked me, "Why is it JD-advantaged? Why not the advantage of the JD?" 

Northeastern.  It is somewhat surprising that for Northeastern alumni who graduated during the 1970s, 80s, and 90s, 48% have worked in government.  That is a big number.  Northeastern’s mission and faculty emphasize public service. This same emphasis appears to be reflected in the careers of its graduates.

Changing Legal Ecosystem.  As noted in Posts II and III, because the Northeastern alumni survey spans multiple decades, it is possible that responses will be influenced by changes in the underlying legal economy. Stated simply, career opportunities and competition may have changed substantially between 1971 and 2012.  Such a pattern appears to be present here.  Specifically, 30% or more of graduates of the 1990s and 2000s have worked in private industry compared to 24% or less for those graduating in the 1970s and 80s.  This would be consistent with the incomplete absorption theory discussed in Part III.  See also Henderson, “Is the Legal Profession Showing its Age,” LWB, Oct 12, 2015.

Practicing versus Non-Practicing Lawyers

Another significant finding that flows from the Northeastern alumni survey are the workplace experiences of practicing versus non-practicing lawyers. 

Approximately 25% of respondents were not practicing lawyers but working, with no significant difference by decade cohort. The chart below compares these two groups based on 19 dimensions of workplace satisfaction. The question is drawn directly from the AJD Wave III:  “How satisfied are you with the following aspects of your current position?” 

Dimensions of Workplace Satisfaction, Practicing vs. Non-Practicing Lawyer


Choices ranged from 1 (highly dissatisfied) to 7 (highly satisfied).  The chart above summarizes the differential between the two groups.  For example, on Intellectual Challenge, we subtracted the non-practicing attorney average from the practicing attorney average.  The result is +.35 difference for practicing attorneys, meaning that they are more likely to find intellectual challenge in their work.  Likewise, the same results holds for the substance of one's work.  

In contrast, on workplace diversity, non-practicing lawyers were significantly more satisfied – on average, roughly 2/3 of a response point.  In fact, non-practicing lawyers were more likely to rate their workplaces higher on several surprising factors, including social value of work, performance reviews, work/life balance, and pro bono opportunities.

Can we generalize from these findings?

The results presented in this blog series reflect the collective experience of one law school’s alumni base – Northeastern.  There is no way to know if these results can be fairly generalized to the larger law graduate population, though there is a reasonable basis to believe that at least some of them can (e.g., the changing ecology of the legal job economy).  Yet, why speculate when the cost of collecting and analyzing the data is going down and the value of such applied research is going up?

AbfLet me reiterate my suggestion from Part I that a consortium of law schools should begin this effort under the aegis of the American Bar Foundation (the prime architect of the AJD Project).  Northeastern has agreed to donate the survey and research tools we created as part of the Outcomes Assessment Project.   Such an initiative would enable researchers to draw stronger conclusions from these data, including potentially laudatory school-level effects that can help the rest of legal education. 

I have been researching legal education for many years.  I have spent enough time with alumni at Indiana Law, Northeastern Law, and several other law schools to gain a strong impression that law school graduates are having, on balance, important, satisfying and high-impact careers.  Further, there is strong evidence that the legal industry is undergoing a significant structural change – that is much of what the Legal Whiteboard catalogs.  This structural change topic is of great interest to prospective students, lawyers, and the mainstream press.  Yet, these two themes--the careers of alumni and structural change--are related. 

If legal education wants to influence the narrative on the value of the JD degree, it is far better to rely on data rather than rhetoric.  My sense is that data on our alumni will tell a rich, balanced story that will enable us to make better decisions for all stakeholders, including prospective law students. Further, if we don’t gather high quality facts, we can expect to get outflanked by a blogosphere and a mainstream press that are armed with little more than anecdotes.  To a large extent, that is already happening.  Now is the time to catch up.


This blog post series would not have been possible without the dedication and world-class expertise of my colleague, Evan Parker PhD, Director of Analytics at Lawyer Metrics.  Evan generated all the graphics for the Northeastern Alumni/ae Survey and was indispensable in the subsequent analysis. He is a highly talented applied statistician who specializes in data visualization.  Evan, thanks for you great work!

For other “Varied Career Path” findings, see the full Alumni/ae Survey Report at the OAP website


Part I:  What Can We Learn by Studying Law School Alumni? A Case Study of One Law School

Part II, Alumni Surveys, Before-Law School

Part III: Alumni Surveys, During Law School

November 9, 2015 in Blog posts worth reading, Data on legal education, Data on the profession, Structural change | Permalink | Comments (0)

Wednesday, November 4, 2015

Part III: Alumni Surveys, Responses on the Law School Experience

Part II of this blog series reported that the top motivations to attend law school have remained the same for over four decades, at least for Northeastern University School of Law (NUSL).  Alumni reported the same underlying desire: to build a satisfying, intellectually challenging career where they could help individuals and improve society. This may be an image forged by pop culture and the idealism of youth, but it is also likely sincere.  It is the better side of our human nature. 

Part II also showed two motivations to attend law school – the desire for “transferable skills” and “eventual financial security"-- that did appear to be shifting over time.  I suggested that these shifts are more likely about a changing ecosystem than a fundamental shift in the type of people applying to law school.  

A similar ecological theme can be observed in the "During Law School" data. For example, since its reopening in 1968, Northeastern Law has required every graduate to complete four 11-week cooperative placements, usually in four different practice settings (e.g., government agency, public defender, large firm, public interest organization). As noted in Part I, students can be paid during co-op because it is a university rather than an ABA requirement. Cf. Karen Sloan, “The ABA says No to Paid Student Externships,” Nat’l L J, June 10, 2014.

One series of questions in the alumni survey specifically focused on the co-op experience, including co-op quality, what was learned, and whether they were paid.  The chart below reveals a steady, four-decade decline in the number of paid co-ops.


In the early 1970s, essentially all four co-ops were paid.  By the mid-80s, the average was down to three. Since the 2000s, the average has been two or fewer paid co-ops.

To my mind, the above trendline is compelling evidence of a steady, systemic shift in the legal ecosystem. I have written about this pattern in the past, suggesting that the rate of absorption of law grads into the licensed bar has been going down since the 1980s.  See Henderson, “Is the Legal Profession Showing its Age,” LWB, Oct 12, 2014 (noting that between 1980 and 2005, the average age of licensed lawyers increased from 39 to 49).  

When I saw this downward trendline for the first time, I recalled my numerous interviews with NUSL alumni/ae from the 1970s. In describing their co-ops, they spoke of opportunities that were plentiful and varied. I often heard the refrain, “I paid for law school mostly with my income from co-op.”  Note that during the 1970s, graduating from college was much less prevalent than today.  Law firms were also growing, with 1970 becoming a major inflection point in the rise of the large law firm. See Galanter & Palay, Tournament of Lawyers (1991) (seminal text collecting and analyzing data on the growth of large firms).

The trendline on paid co-ops also made me rethink what I heard from NUSL co-op employers. The school has roughly 900 employers who regularly or semi-regularly participate in co-op.  I heard several regular employers express strong preferences for “third or fourth co-ops." Why?  Because third or fourth co-op students already had significant legal experience and needed less training to be valuable to the employer.  Training is costly. Even if the trainee is unpaid, the lawyer-as-teacher is expending their own valuable time.  If an employer is going to provide training, they need a way to recapture that investment. Unpaid labor for eleven weeks is one potential way; if the labor is already partially trained, that is even better.

Unfortunately, doing a great job for a co-op employer does not guarantee permanent employment or even a modest wage for temporary work.  The legal ecosystem does not reliably and consistently support those outcomes. Yet, 20, 30, or 40 years ago, the dynamics were far more favorable. 

Obviously, in the year 2015, law grads are having a difficult time finding permanent, long-term professional employment (bar passage-required, JD-advantaged, or non-legal professional jobs).  The shortage of high-quality entry level jobs has given rise to criticisms that legal education needs more practical training.  The implicit assumption is that such a change will cure the underemployment problem.  I am skeptical that is true. 

A more likely explanation for law grad underemployment is that the supply of trained lawyers is in excess of demand, partially due to demographics and partially due to the inability of most citizens to afford several hours of a lawyer's time.  This is a very difficult problem to fix. But misdiagnosing the problem does not help.

To the extent a legal employer is looking for a practice-ready law grad, Northeastern’s co-op model is as likely to deliver that outcome as anything else I have observed.  My in-depth review for how co-op affects professional development is written up in OAP Research Bulletin No. 3.  Ironically, what may be the best practice-ready model among ABA-accredited law schools is a 50-year old program that most critics may not know exists. But see Mike Stetz, “Best Schools for Practical Training,” Nat’l Jurist, March 2015 (ranking Northeastern No. 1).

The experiential education crowd will be heartened by another “During Law School” finding.  Among 833 alumni respondents, there were more than 3,200 co-ops identified by practice setting.  Alumni were asked to identify their most valuable co-op and provide a narrative as to why. 

Below is a chart that plots the difference between the baseline frequency of a particular co-op practice setting and how often that practice setting was picked as the most valuable.  The scale is in standard deviation units, with “par” meaning that the practice setting was most valuable in the same proportion as its frequency in the overall sample.


It is not hard to see the common theme.  Co-ops where students can observe lawyers in action – or better yet, get stand-up time in court – were rated as much more valuable.  The table below captures some of the underlying narrative comments.


For other “During Law School” findings, see the full Alumni/ae Survey Report at the OAP website


Part I:  What Can We Learn by Studying Law School Alumni? A Case Study of One Law School

Part II, Alumni Surveys, Before-Law School

Part IV: Alumni Surveys, The Varied Career Paths of Law School Graduates

November 4, 2015 in Blog posts worth reading, Data on legal education, Data on the profession | Permalink | Comments (0)

Monday, November 2, 2015

Part II: Alumni Surveys, Pre-Law Characteristics and Motivations

Building on the introduction (Part I) of this blog series, our alumni survey of Northeastern University School of Law yielded cross-sectional data that span graduates from 1971 to 2012.  Because of the large time span, some of the most interesting responses to questions tend to fall into two buckets:

  1. What is staying the same?  Here we are looking for response patterns that are relatively stable and constant across age cohorts.
  2. What is changing?  Likewise, we are also interested in responses that appear to be changing as a function of time of graduation.

In the portion of our analysis that looked at pre-law characteristics and motivations, our most striking findings tended to fall into bucket #1. 

For example, below is a graphic summarizing responses to the question, “How important were the following goals in your decision to attend law school?” Responses are organized by decade of graduation.  They are ordered by most important to least important for respondents who graduated in 2000 or later.

                              Goals for Attending Law School, by Decade of Graduation

One of the most striking features is that the top three responses are essentially identical for all four age cohorts.  For each group, the desire to have a satisfying career, help individuals, and improve society were all, on average, very important in the decision to attend law school. 

Although there are differences across age cohorts, there remains relatively clear clustering by decade of graduation. (Query: would this same pattern hold true at other law schools?  One of the advantages of pooling data across schools is the ability to isolate a self-selection effect that operates at the school level.)

Yet, some factors appear to be changing over time, such as the importance of transferable skills and eventual financial security.  With each decade cohort, respondents are rating these factors progressively more important to their decision to attend law schools. Likewise, “other goals” appear to be progressively less important. 

These patterns (and others survey results I will report in Parts III and IV) suggest gradual changes in the knowledge worker ecosystem that require students to be more deliberate and focused in their decision to attend law school.  For example, costs of all of higher education are going up at the same time that the financial payoffs of traditional graduate and professional education are becoming less certain.  This is an ecological effect that is bound to have an influence on students and student decision making.  Although legal education would be part of this shift, the shift itself would not be unique to law.

This interpretation is consistent with our focus group discussions with Northeastern alumni.  This group queried whether the term “transferable skills” was even part of the lexicon when they were graduating from college.  Likewise, the group commented that the decision to attend law school during the 1970s and 1980s was not difficult because tuition was relatively low and jobs, including paid co-op jobs, were relatively plentiful. Although the legal market may be tighter and more complex than in earlier decades, the Northeastern alumni commented that the tradeoffs were changing for all knowledge workers.  

For other “Before Law School” findings, see the full Alumni/ae Survey Report at the OAP website


Part I:  What Can We Learn by Studying Law School Alumni? A Case Study of One Law School

Part III: Alumni Surveys, During Law School

Part IV: Alumni Surveys, The Varied Career Paths of Law School Graduates

November 2, 2015 in Blog posts worth reading, Data on legal education, Data on the profession, Important research | Permalink | Comments (1)

Part I: What Can We Learn by Studying Law School Alumni? A Case Study of One Law School

BryantgarthSeveral years ago, as the legal academy was beginning to work its way through the implications of the landmark “After the JD” Project (AJD), one of the principal investigators, Bryant Garth, commented to a group of fellow law professors that “within a few years it will be educational malpractice for law schools to not study their own alumni.”

Garth had special standing to make this claim, as he had launched the AJD during his long tenure at the American Bar Foundation and then went on to serve as Dean of Southwestern Law School in Los Angeles. While at Southwestern, Garth taught a short 1L course about legal careers that combined AJD findings with live interviews with Southwestern alumni. Despite decades of research studying lawyers, Garth gushed at how much he personally learned from these interviews and how the narratives were often surprising and inspiring, particularly for Southwestern students filled with apprehension at what the future might hold.

I had occasion to remember Garth’s observations in early 2011 when Emily Spieler, then the Dean of Northeastern University School of Law (NUSL), suggested that I study her alumni.

Northeastern Law

Northeastern is an interesting case study because for nearly 50 years the school has required four 11-week cooperative placements (or “co-ops”) as a condition of graduation. To facilitate completion within three years, the 1L year at Northeastern is taught in semesters while the 2L and 3L years are taught over eight alternating quarters. Summer-winter co-op students take classes during the fall and spring quarters, while fall-spring co-op students attend classes in the summer and winter quarters. Because co-ops are not for academic credit – they fulfill Northeastern University rather than ABA-accreditation requirements – students can be paid for the full 11 weeks. (More on that in Part III of this series.)

Dean Spieler wanted a third party to study Northeastern because, in her experience as dean, her many encounters with Northeastern alumni suggested to her that the School’s unusual education model was accelerating the professional development of its students and enabling them to make better, more informed career choices.

Acceleration of profession development is a very difficult effect to measure, but it is certainly plausible. In fact, the entire experiential law movement is largely premised on this claim. So I signed onto a multi-year initiative that we called the Outcomes Assessment Project (OAP).

The premise of the OAP was very unusual. Through a generous but anonymous benefactor, the research tools and templates developed for the OAP would be made available to other law schools interested in studying graduates. The intent is for law schools to accumulate data using similar methods and instruments, driving up the value of the data (because it is comparable across schools) while driving down the cost of collection and analysis.

There are many phases to the OAP, including those focused on admissions, the student experience, and co-op employers. Here, however, I wanted to write about what we learned from a survey of Northeastern’s alumni.

Last fall, we sent a survey instrument to Northeastern alumni who graduated from the law school between 1971 and 2012 (~4,000 law grads for which NUSL had a current email address). The survey instrument was substantially based on the AJD Wave III survey instrument, which was sent to a representative sample of law graduates from all ABA-accredited law schools who took the bar in the year 2000.

In contrast to the AJD, which has produced remarkable knowledge about law school grads from the year 2000, the OAP Alumni/ae Survey included four decades of law graduates from a single law school. Although this is not a true longitudinal sample, which samples the same people over time, this methodology enables cross-sectional comparisons between different cohorts of graduates (e.g., by decade of graduate or pre/post AJD).

The response rate of the Northeastern alumni survey was 21% (833 total completed questionnaires), which is relatively high for a long online survey. Because the resulting sample substantially mirrored the baseline data we had for Northeastern alumni practice areas and years of graduation, we were confident that the resulting sample was both representative and reliable.

Applied Research

Similar to the AJD, the OAP Alumni/ae Survey produced enough data to keep researchers busy for several years. Hopefully, these data will eventually be archived and aggregated at the American Bar Foundation or a similar institution in order to facilitate a broader and deeper understanding of legal careers.

However, the OAP was largely set up to be applied research. What does this mean? Here, the goal is, at least in part, to obtain data that is operational in nature, thus enabling a law school to examine and test fundamental assumptions and generate insights related to its stated goals and mission. In a word, to improve.

Further, when skillfully boiled down using data visualization, the findings themselves tend to be of great interest to all law school stakeholders, including alumni, faculty, administrative staff, current students, and prospective students. Interest is particularly piqued during times of transition and uncertainty, such as now, when law schools and the practicing bar are looking to each other to provide potential answers and support.

To makes results as accessible as possible, we decided to present the preliminary Alumni Survey results in a simple three-part framework:

  • Before Law School: pre-law characteristics and motivations
  • During Law School: the law school experience
  • After Law School: job mobility and satisfaction

This week, I am going to give a sampling of findings from all three sections – findings that will likely be of interest to a non-Northeastern audience of law faculty, practicing lawyers, and students. If you are interested in reading the entire preliminary report, it can be found online at the Northeastern OAP website.


Part II, Before-Law School

Part III: Alumni Surveys, During Law School

Part IV: Alumni Surveys, The Varied Career Paths of Law School Graduates

November 2, 2015 in Blog posts worth reading, Data on legal education, Data on the profession, Important research | Permalink | Comments (0)

Sunday, October 25, 2015

Is there a right way to respond to the "Law School Debt Crisis" Editorial?

Amidst all the other newsworthy topics, the New York Times editorial board made law school debt the lead editorial for today's Sunday edition. And the story line is not good.  

The editorial starts with the bleak statistics for Florida Coastal Law School -- low median LSAT scores and high debt loads, casting doubt on whether its graduates can pass the bar exam and repay their federally financed student loans.  The editorial highlights Florida Coastal' for-profit status but goes on to note that the rest of legal education is not much better. 

A majority of American law schools, which have nonprofit status, are increasingly engaging in such behavior, and in the process threatening the future of legal education.

Why? The most significant explanation is also the simplest — free money.

The editorial details changes in federal higher education finance that created the Direct PLUS Loan program, which, over-and-above Federal Stafford Loans, underwrites up to the full cost of attendance as determined by each law school.  The combination of poor job prospects and high debt have depressed applicant volume.  As the Times editorial notes, the systemic impact has been to lower admissions standards to sweep in students who will, as a group, struggle to pass the bar exam following graduation.  Virtually all of this is financed by DOE loan money.

I don't think the typical member of the legal academy understands the precarious financial condition of legal education.  The precariousness exists on two levels: (1) our financial fate is in the hands of the federal government rather than private markets; and (2) the Times editorial suggests that we have a serious appearance problem, which draws down the political capital needed to control our own destiny.  With the political winds so goes our budgets. 

I think it is important for the Association of American Law Schools (AALS) to take some decisive action in the very near future.  In this blog post, I explain where the money comes from to keep the law school doors open and why, as a consequence, we need to pay closer attention to the public image of legal education.  I then offer some unsolicited advice to the AALS leadership. 

(1) Who pays our bills?  

Over the last decade, the federal government has, as a practical matter, taken over the financing of higher ed, including legal education.  

Here is how it works.  Any law student who needs to borrow money to attend law school is strongly incentivized to borrow money from the Department of Education (DOE).  Although the DOE loans carry high interest rates -- 6.8% for Stafford Loans and 7.9% for Grad Plus -- they include built-in debt relief programs that functionally act as insurance policies for the risk that a graduate's income is insufficient to make timely loan repayments.  Law school financial aid offices are set up around this financial aid model and make it very easy for students to sign the loan documents, pay their tuition, and get disbursements for living expenses.

In the short to medium term, this is good for the federal government because the loans are viewed as income-producing assets in the budgets that get presented to and approved by Congress. But in the longer term this could backfire if a large portion of students fail to repay their full loans plus interest.  Federal government accounting rules don't require projections beyond ten years.  But already the government is beginning to see the size of the coming write-downs for the large number of graduates who are utilizing the Public Service Loan Forgiven program, which has a ten-year loan forgiveness horizon. And it is causing the feds to revise their budgets in ways that are politically painful.  With the loan forgiveness programs for private sector law grads operating on a 20- to 25-year repayment window, the magnitude of this problem will only grow.  

The enormous risk here for law schools is that Congress or the DOE will change this system of higher education finance.  For example, the Times editorial calls for capping the amount of federal loans that can be used to finance a law degree.  Currently, the limit on Stafford Loans for graduate education is $20,500, but Grad Plus loans have no limit at all.  If the DOE were to cap Grad Plus at $29,500 per year, leading to a total three-year federal outlay of $150,000 per law student, this would have an enormous adverse impact on the typical law school budget.

Law School Transparency reports that the average law school debt load for a 2014 law graduate is $118,570, but we know very little about the full distribution.  Because of the pervasiveness of the reverse Robin Hood policy, which uses tuition dollars of low credentialed students to finance scholarships for their high credentialed peers, there is likely a significant percentage of students at most law schools who graduate with more than $150,000 in law school debt.   Further, according to US News, there are twelve law schools -- including three in the T14 -- where the average law school debt load is more the $150,000.  Although there are no statistics on the percentage of law students graduating with greater than $200,000 in law school debt, law students tell me this amount is common. 

I have translated this meager public information into the chart below. The area in green is the volume of money that could disappear from law school budgets if the federal government imposed a hard limit on federally financed law school lending.


Why would this money be at grave risk?  Two reasons:

First, private lenders will be reluctant to cover the entire shortfall.  For decades, private lenders played an important roll in law school finance.  But these lenders got pushed out of the market by the changes in federal higher ed finances described above.  Unfortunately, in the intervening years, the ratio of earning-power-to-debt has gotten too far out of whack.  To come back into this market, private lenders would need to be confident that loans would be repaid.  That likelihood is going to vary by law school and by law student, raising the cost of lending.  This means that, to varying degrees, virtually all law schools would have to sweat over money.  Unlike Grad Plus, private lenders may balk at financing full sticker tuition for lower credentialed students trying to attend the highest ranked school that admitted them.

Second, private lenders will not offer the same loan forgiveness options, such as IBR and Public Service Loan Forgiveness, currently offered by the federal government.  With the curtailed scope of these functional insurance programs, some portion of prospective law students will likely be unwilling to sign loan documents in excess of the federal lending cap.  Even very elite schools will feel the pain here.

(2) An appearance problem in the world of politics

I would bet a lot of money that law faculty have been emailing the Times editorial to one another, criticizing its lack of nuance.  But here is our problem.  We are not in a court where a judge will listen to our elegant presentation of facts and law.  Nor are we in the world of private markets where we can expect people to reliably follow their own economic self-interest.  We are in the realm of politics where sides get drawn based on appearance and political expediency.  To make matters worse, the legal academy just got lambasted by the paper of record on the left.

It is hard to argue that a cap on federal funding of legal education would be bad policy for students, the legal profession, taxpayers, or broader society.  Such a change would:

  1. Reduce the number of law grads going into a saturated labor market;
  2. Reduce the number of low credentialed students admitted to law school who will one day struggle to pass the bar;
  3. Reduce the risk of nonpayment of students loans currently borne by US taxpayers;
  4. Put in place serious cost-containment on legal education.

For law schools, however, such a change would produce layoffs and pay reductions.  And that may be the fate of the luckier schools.   It is widely known that most law schools are running deficits.  Central universities are looking for ways to wait out the storm.  But the cliff-like quality of a federal cap on law school lending would call the question of how much support is too much.  

What's the solution?

Legal education has a cost problem, but so does the entire higher ed establishment. Here is my unsolicited advice.

The leadership of the AALS needs to take a very strong public position that the trend lines plaguing higher ed need to be reversed.  This is not risky because it is so painfully obvious.  The AALS should then, in conjunction with the ABA, send a very public delegation to the Dept of Education. The delegation should be given a very simple charge:  Help the DOE

  1. Outline the systemic problems that plague higher education 
  2. Articulate the importance of sound policy to the national interest
  3. Formulate a fair and sustainable solution. 

I have faith that my legal colleagues would do a masterful job solving the problems of higher education.  And in the process, we'll discover that we have become the architects of a new system of higher ed finance that will be fair and equitable system for all stakeholders, including those employed in legal education.  That's right: act decisively to ensure a fair and equitable deal.  The only drawback is that it won't be the status quo that we'd instinctively like to preserve. 

October 25, 2015 in Blog posts worth reading, Current events, Data on legal education | Permalink | Comments (25)

Sunday, October 11, 2015

"Called On": A Novel by Lisa McElroy

COPB cover full_001I learned that friend Lisa McElroy (Drexel) has published her novel Called On with friend Alan Childress's (Tulane) Quid Pro Books.  From the blurb:

Libby Behl and Connie Shun are both at Warren Law because they want to make the world better. First-year student Libby’s got a lot to learn about law — not to mention love, long nights, and low-grade coffee. Through a difficult year, her professor Connie starts to question what she knows about how law — and justice — work. Witty and insightful, Called On is an insider’s peek into the struggles of learning law and the satisfaction of finding a new path in life.

The book is available in a Kindle edition.

Quid Pro also publishes Lawrence Friedman's (not just a historian, but a novelist too) "Frank May" mysteries, the latest of which is Dead in the Park.

October 11, 2015 | Permalink | Comments (0)

Friday, October 2, 2015

Part Two - The Impact of Attrition on the Composition of Graduating Classes of Law Students -- 2013-2016

In late December 2014, I posted a blog entitled Part One – The Composition of the Graduating Classes of Law Students – 2013-2016.  That blog posting described how the composition of the entering classes between 2010 and 2013 has shifted.  During that time, the percentage at or above an LSAT of 160 dropped by nearly 20% from 40.8% to 33.4%.  Meanwhile, the percentage at or below an LSAT of 149 increased by over 50% from 14.2% to 22.5%. 

But this reflects the composition of the entering classes.   How do the graduating classes compare with the entering classes?  This depends upon the attrition experienced by the students in a given entering class.  This much belated Part Two discusses what we know about first-year attrition rates among law schools.

I have compiled attrition data from all of the fully-accredited ABA law schools outside of Puerto Rico for the last four full academic years.  I have calculated average attrition rates for the class as a whole and then broken out average attrition rates by law schools in different median LSAT categories – 160+, 155-159, 150-154 and <150.

In a nutshell, overall first-year attrition increases as the median LSAT of the law school decreases.  Over the last few years, while “academic attrition” has declined for law schools with median LSATs of 150 or greater, “other attrition” has increased modestly, particularly for law schools with median LSATs <150, resulting in a slight increase in overall first-year attrition between 2010 and 2013.

Overall First-Year Attrition Rates Have Increased Slightly

In calculating attrition rates, I wanted to capture those students who are no longer in law school anywhere.  Thus, for these purposes, “attrition” is the sum of “academic attrition” and “other attrition.”  “Academic attrition” occurs when a law school asks someone to leave because of inadequate academic performance.  “Other attrition” occurs when a student departs from the law school volitionally. Both of these categories exclude “transfers.”

The following chart shows that despite the declining “LSAT profile” of the entering classes between 2010 and 2013, there has been no meaningful change in the average “academic attrition” rate.  The modest increase in overall first-year attrition over this period, from roughly 5.8% to roughly 6.6%, is largely due to a growth in the “other attrition” category from roughly 2.5% to roughly 3.2%.

Overall First-Year Attrition for Classes Entering in 2010, 2011, 2012, and 2013


Beg. Enrollment

Academic Attrition

% Academic

Other Attrition

% Other

Total Attrition

% Attrition

































 (Calculating attrition rates for 2010-11, 2011-12 and 2012-13, is a little more complicated than one might think.  For ABA reporting years of 2011, 2012, and 2013, “academic attrition” was reported separately, but “other attrition” included “transfers out.” Thus, to generate the real “other attrition” number, one needs to “subtract” from “other attrition” the numbers associated with “transfers out.” Because some schools occasionally listed transfers out in “second year” “other attrition,” this analysis should be understood to have a little fuzziness to it for years 2010-11, 2011-12 and 2012-13.  For ABA reporting year 2014, transfers out were not commingled with “other attrition,” so the calculations were based solely on the sum of “academic attrition” and “other attrition.”  Beginning with reporting this fall, “academic attrition” will include both involuntary academic attrition as well as voluntary academic attrition (students who withdrew before completing the first-year, but were already on academic probation).)

Academic Attrition Rates Increase as Law School Median LSAT Decreases

Notably, there are different rates of attrition across law schools in different LSAT categories.  The following chart breaks down attrition by groups of law schools based on median LSAT for the law school for the entering class each year.  For each year, the chart shows the average first-year attrition rates for law schools with median LSATs of 160 or higher, for law schools with median LSATs of 155-159, for law schools with median LSATs of 150-154 and for law schools with median LSATs less than 150.  In addition, it breaks out “academic attrition” and “other attrition” as separate categories for each category of law school and for each year and then provides the total overall attrition rate each year along with the four-year average attrition rate.

Average Attrition Rates by Category of Schools Based on Median LSAT







Median LSAT













Four-Year Average


























































When looking at this data, some things are worth noting. 

First, across different LSAT categories, overall attrition increases as you move from law schools with higher median LSATs to law schools with lower median LSATs, going from an average over the four years of 2.3% for law schools with median LSATs of 160+, to 5.2% for law schools with median LSATs of 155-159, to 9.4% for law schools with median LSATs of 150-154, to 13.1% for law schools with median LSATs of <150.  “Academic attrition” consistently increases as median LSAT decreases, while “other attrition” is mixed. (Although this analysis is focused on four LSAT categories, the trend of having overall attrition increase as median LSAT decreases continues if you add a fifth LSAT category. In 2010-11 there was only one law school with a median LSAT of 145 or less, with only 320 students.  By 2013-14, however, there were nine law schools with a median LSAT of 145 or less, with 2,075 students.  The overall first-year attrition rate (encompassing academic attrition and other attrition) at these nine schools in 2013-14 was 15.9 percent.  The overall attrition rate at the other 24 law schools with a median LSAT less than 150 was 13.6 percent.) 

Second, over the period from 2010-2013, “academic attrition” generally appears to be flat to decreasing for schools in all LSAT categories except for 2013-14 year for law schools with median LSATs <150, where it increased slightly (largely because of the larger number of schools with median LSATs of 145 or less).  By contrast, “other attrition” presents more of a mixed record, but generally appears to be increasing between 2010 and 2013 for schools in most LSAT categories.  Nonetheless, average overall first-year attrition is lower in 2013-14 for law schools in the top three LSAT categories.

Third, if you are wondering why the average overall attrition could be increasing while the overall attrition rates for the top three LSAT categories are decreasing, the answer is because of the changing number of students in each category over time.  As noted in Part I, the number of students and percentage of students in the top LSAT category has declined significantly, while the number of students and percentage of students in the bottom LSAT category has increased significantly.  This results in the average overall attrition rate increasing even as rates in various categories are decreasing.

Thoughts on Attrition Rates

It makes sense that “academic attrition” increases as law school median LSAT decreases.  It seems reasonable to expect that law schools with median LSATs of <155 or <150 will have higher “academic attrition” rates than those with median LSATs of 155-159 or 160 and higher. 

It may make less sense, however, that “academic attrition” generally decreased across all four categories of law schools between 2010-11 and 2013-14 (with the exception of law schools with a median LSAT <150 in 2013-14), even as the LSAT profile of each entering class continued to decline.  With an increase in the number and percentage of law students with LSATs of <150, particularly those with LSATs of <145, one might have anticipated that the average rate of “academic attrition” would have increased, particularly among law schools with median LSATs of 150-154 (who might have seen an increase in the number of students with LSATs less than 150) and among law schools with median LSATs of <150, given the increase in the number of law schools with median LSATs of 145 or less. 

Cynics might argue that from a revenue standpoint, law schools are making a concerted effort to retain a higher percentage of a smaller group of students.  But this assumes a degree of institutional purposefulness (coordination among faculty) that is rare among law schools.  Moreover, my sense is that there are much more benign explanations.

First, if law schools have not adjusted their grading curves to reflect a different student profile, then the standard approach to first-year grading – which involves a forced curve at most schools -- is likely to produce a similar percentage of “at risk” students year over year even though the objective credentials of each entering class have declined. 

Second, with the decline in the number of applicants to law school, one might surmise that those choosing to go to law school really are serious about their investment in a legal education and may be working harder to be successful in law school, resulting in fewer students facing academic disqualification, even though the credentials for each entering class have been weaker year over year.  This may be particularly true in law schools with robust academic support programs which may be helping some students on the margin find sufficient success to avoid academic attrition.

Third, and perhaps most significantly, however, is the reality that “academic attrition” and “other attrition” are related.  Indeed, that is why I have reported them together in the charts above as two components of overall attrition.  Some students who might be at risk for “academic attrition” may decide to withdraw from law school voluntarily (and be classified under “other attrition” rather than “academic attrition”). In addition, it is possible that other students, particularly at law schools with median LSATs <150, may be voluntarily withdrawing from law school because they have decided that further investment in a legal education doesn’t make sense if they are performing relatively poorly, even though the law school would not have asked them to leave under the school’s policy for good academic standing. 

The fact that the percentage of students in each entering class with LSATs of <150 and even <145 has increased substantially between 2010 and 2013, while the rate of overall first-year attrition has increased only modestly over this time period, suggests that the composition of graduating classes (based on LSATs) will continue to weaken into 2016 (and probably 2017 if attrition patterns did not change in 2014-15).  As a result, the declines in the median MBE scaled score in 2014 and 2015 could be expected to continue in 2016 and 2017.  Some law schools also are likely to see bar passage rates for their graduates decline, perhaps significantly, in 2015, 2016 and 2017.

Unanswered Questions

This analysis focuses on first-year attrition.  There continues to be attrition during the second year and third year of law school, generally at lower rates, perhaps 2-3% of second-year students and 1-2% of third-year students.  (On average, the number of graduates in a given class has been around 90% of the entering class.)  It is not clear yet whether attrition among upper level students follows similar patterns across different categories of law schools.  The publicly-reported attrition data also does not provide any information regarding the gender or ethnicity or socio-economic background of students leaving law school.  Therefore, we don’t know whether there are different rates of attrition for women as compared with men or whether students of different ethnic backgrounds have different rates of attrition.  We also don’t know whether first-generation law students experience attrition at greater rates than other law students, or whether students of lower socio-economic status experience attrition at greater rates than students of higher socio-economic status. 

(I am very grateful for the insights of Bernie Burk and Scott Norberg on earlier drafts of this blog posting.)

October 2, 2015 in Data on legal education, Scholarship on legal education | Permalink | Comments (1)

Tuesday, September 22, 2015

William H. Neukom Fellows Research Chair in Diversity and Law

On the heels of the ABF Research Professor job announcement, here is a second career-making opportunity from our friends at the American Bar Foundation.

William H. Neukom Fellows Research Chair in Diversity and Law

The American Bar Foundation (ABF) invites applications for its William H. Neukom Fellows Research Chair in Diversity and Law. This is a one-year, visiting position for the 2016-17 academic year. The ABF anticipates that the Neukom Chair will become a long-term position in the future.

We seek an outstanding scholar with a distinguished record of scholarship in law and the social sciences who is conducting empirical research on diversity and law, broadly conceived. Topics of interest include, but are not limited to, diversity in the legal profession and other institutions of justice; the impact of diversity on legal processes, legal institutions, and public policy; the roles of race, gender, disability, and sexuality in legal institutions and legal processes; and the interaction between legal processes and inequalities of race, gender, disability, and sexuality. Applicants from all social science fields, history, and law will be considered.

In addition to pursuing their own research, the Neukom Fellows Research Chair will have the opportunity to participate in the ABF’s expanding program of research in diversity and law. During the visit the Neukom Chair will be expected to be in residence at the ABF, and to make at least one formal presentation on the work they are doing at the ABF.

The ABF is an independent, scholarly research institute committed to social science research on law, legal institutions, and legal processes. Its faculty consists of leading scholars in the fields of law, sociology, psychology, political science, economics, history, and anthropology. The ABF is strongly committed to diversity in hiring.

Review of applications will begin on November 15, 2015, but the search will be ongoing until the position is filled. We ask that applicants submit a letter of application, a curriculum vitae, a brief (no more than 2-page) description of current research and a list of three references.

Application letters should be addressed to Ajay K. Mehrotra, Director, and sent in electronic form to Erin Watt, Executive Assistant, at with the subject line “Faculty Search.” Queries about the application process can be directed to Ms. Watt at (312) 988-6582.

The American Bar Foundation encourages diversity in its workforce and seeks to provide equality of opportunity for all applicants and employees. All persons are considered for positions on the basis of job-related requirements. All decisions regarding recruiting, hiring, promotion, assignment, training, termination, and other terms and conditions of employment will be made without unlawful discrimination on the basis of race, color, national origin, ancestry, sex, sexual orientation, gender identity or expression, religion, age, disability, veteran status, pregnancy, or marital status, in accordance with the ABF’s commitment to equal opportunity and all governing laws.

September 22, 2015 in New and Noteworthy | Permalink | Comments (0)

American Bar Foundation Research Professor

AjayFor those in the academy doing interdisciplinary work in the law & society area, being a Research Professor at the American Bar Foundation (ABF)  is very close to nirvana.  Moreover, my former Indiana colleague Ajay Mehrotra is the ABF's new Director.  Based on our 12 years of working together, I can attest that Ajay would be an outstanding mentor and boss, albeit this description also describes his predecessor, Bob Nelson.  The ABF is just a great place to do potentially high impact research. 

Below is the official announcement for an ABF Research Professor opening. These positions come open only rarely

American Bar Foundation Research Professor

Pending budgetary approval, the American Bar Foundation (ABF) invites applications to join its Residential Faculty as a Research Professor. Beginning in the 2016-17 academic year, the position is an ongoing one, subject to periodic performance reviews.

We seek earlier-stage candidates with a PhD and/or JD with the potential for exemplary scholarship in law and the social sciences. Research area, discipline, and methodology are open. The ABF is strongly committed to diversity in hiring.

The ABF is an independent, scholarly research institute committed to social science research on law, legal institutions, and legal processes. Its faculty consists of leading scholars in the fields of law, sociology, psychology, political science, economics, history, and anthropology.

Research professors work independently. They are responsible for identifying appropriate topics for research, seeking external funding when possible, conducting research, and authoring books and articles to be published in scholarly journals.

The ABF offers competitive salary and benefits along with research support. If jointly appointed with law or social science faculties of Chicago-area institutions, the ABF works closely with these institutions to coordinate on matters such as salary, benefits, and other work arrangements.

Review of applications will begin on November 15, 2015. We ask that applicants submit a letter of application, a curriculum vitae, a writing sample, a brief (no more than 2-page) description of current research and plans for future research, and a list of three references.

Application letters should be addressed to Ajay K. Mehrotra, Director, and sent in electronic form to Erin Watt, Executive Assistant, at with the subject line “Faculty Search.” Queries about the application process can be directed to Ms. Watt at (312) 988-6582.

The American Bar Foundation encourages diversity in its workforce and seeks to provide equality of opportunity for all applicants and employees. All persons are considered for positions on the basis of job-related requirements. All decisions regarding recruiting, hiring, promotion, assignment, training, termination, and other terms and conditions of employment will be made without unlawful discrimination on the basis of race, color, national origin, ancestry, sex, sexual orientation, gender identity or expression, religion, age, disability, veteran status, pregnancy, or marital status, in accordance with the ABF’s commitment to equal opportunity and all governing laws.

September 22, 2015 in Current events, New and Noteworthy | Permalink | Comments (0)

Thursday, September 17, 2015

2015 Median MBE Scaled Score Arguably Declines Less Than Expected

Natalie Kitroeff at Bloomberg published earlier today an article with the first release of the median MBE scaled score for the July 2015 Bar Exam -- 139.9 -- a decline of 1.6 points from the July 2014 score of 141.5. 

While this represents a continuation of the downward trend that started last year (when the median MBE fell a historic 2.8 points from 144.3 in July 2013), the result is nonetheless somewhat surprising. 

The historic decline in the median MBE scaled score between 2013 and 2014 corresponded to a modest decline in the LSAT score profile of the entering classes between 2010 and 2011. 

As I discussed in my December blog posting on changing compositions of the entering classes since 2010, however, the decline in LSAT score profile of the entering classes between 2011 and 2012 was much more pronounced than the decline between 2010 and 2011.  Thus, one might have expected that the decline in the median MBE scaled score for 2015 would have been even larger than the decline between 2013 and 2014. 

But instead, the decline was only 1.6 points, just slightly more than half of the 2.8 point decline of the previous year.

Why would a demonstrably greater decline in the LSAT profile of the entering class between 2011 and 2012 (compared with 2010-2011) yield a manifestly smaller decline in the median MBE scaled score between 2014 and 2015 (compared with 2013-2014)?

This likely will remain a mystery for a long time, but my guess is that the ExamSoft debacle resulted in an aberrationally large decline in the median MBE scaled score between 2013 and 2014, such that the corresponding decline between 2014 and 2015 seems disproportionately smaller than one would have been expected.

Over on Law School Cafe, Debby Merritt has a very good description of the different factors that likely have impacted bar passage performance in July 2015.

Derek Muller has collected bar passage results for the several states that have released at least some results so far and has posted them on his Excess of Democracy blog.  Focusing only on overall bar passage rates, two states are "up," (North Dakota (6%) and Iowa (5%)), six are down between 1-5% (Missouri (-1%), Washington (-1%), Montana (-2%), Kansas (-3%), North Carolina (-4%), West Virginia (5%)), and four are down double-digits (Mississippi (-27%), New Mexico (-12%), Oklahoma (-11%), and Wisconsin (-10%).  (Last year 21 states were down 6% or more on first-time bar passage and six of those were down 10% or more.)

September 17, 2015 in Blog posts worth reading, Data on legal education, Data on the profession | Permalink | Comments (0)

Wednesday, September 16, 2015

In India, Big 4 and Elite Law Firms in Direct Competition for Highly Lucrative Advisory Work

Lawyers may have a monopoly over the practice of law, but what exactly does the practice of law encompass?  In most common law jurisdictions, the term is not even defined.  And there's likely a self-interested reason why.  Ambiguity produces uncertainty, and uncertainty is a major source of business risk.

In the face of significant uncertainty, why would investors fund a business that encroaches on lawyers' most lucrative work when they'll have to hire a battalion of lawyers to defeat the entire universe of lawyers in front of a judge who used to be a practicing lawyer (and may be one again)? Many lawyers would get rich losing this case for you.

Well, ambiguity may not be enough to permanently fend off the invasion.  There is a controversy taking shape in India that may foreshadow the end of the lawyer guild.  Under India's Advocates Act, only lawyers can own a law firm. Likewise, only chartered accountants can audit companies.  But what about advisory services related to business?  That's a area of tremendous potential overlap between these two professions.

Times-of-india-logoGlobally, the Big 4 have been making inroads on lucrative cross-border deal work -- not enough to mortally threaten the major law firms, but enough to get their attention.  Yet, according to this story in the The Economics Times (the leading business paper in India), it's the elite law firms putting the hurt on the Big 4, poaching talent in some of the Big 4's most lucrative practice areas.  Here's how the Indian journalists tell it:

MUMBAI: Two months after the Delhi Bar Council sent a legal notice to top professional services firms EY, KPMG, PwC and Deloitte, the simmering hostility between the Big 4 and the legal fraternity is increasingly coming out in the open.

Earlier this month, Zia Mody's AZB & Partners [the Wachtell Lipton of India] scooped up six forensic experts from EY, a move that has been seen by industry players as part of growing competition between leading law firms and consultancies for business, encroaching into each other's traditional bastions. ...

[Zia Mody, the managing partner of AZB, commented,] "The compliance and investigation practice that we have formalised would help us in due diligence, Indian anti-corruption law investigations, asset-recovery cases, private equity-related post investment investigations and in some anti-trust investigation cases."

Top legal firms in the country are diversifying into forensic operations and undertaking commercial diligence and investigations for their clients.

This comes at a time when consultancies like EY and KPMG are bulking up their teams beyond the traditional forte of audit and tax practices to expand into advisory services. ... 

"What law firms are doing is part of their evolution into full service providers," said Lalit Bhasin, president of the Society of Indian Law Firms, which in July filed a complaint against the Big 4 with the Bar Association of India, saying that they were practicing law without authorisation.

Side note on Lalit Bhasin -- he is the most prominent spokesperson for keeping in place the longstanding prohibition against foreign law firms operating inside India.  He is obviously not too keen on Big 4 accounting firms getting into his business.  The Times quotes a senior partner of a Big 4 firm, speaking on a condition of anonymity,

"The genesis of the problem is: lawyers are a close-knit community and if you don't belong to that club, you don't get lucrative work.  ... Now, the consultancies are increasingly getting their foot in the door, and doing the work at much lower price for which the lawyers would charge a bomb."

The story notes that the law firms and accounting firm are now competing to their mutual detriment, albeit the clients are unlikely complaining:

Consultancies and law firms are competing with each other in several other areas as well, and this is hurting the bottom lines of both sides as undercutting of fees has become rampant. "They (consultants) do an investment banking deal for a mere Rs 5 lakh [~$8000 US], for which a good law firm would charge around Rs 60 lakh [$90,000 US]," said the managing partner of a New Delhi-based big law firm.

Forensic is one of the most profitable business verticals for the Big 4. The total pie for forensics in India is estimated to be around .`850 crore [~$160 million] and is growing at 15-20 per cent year on year, industry experts said. Competition from lawyers, therefore, hurts the big auditors who among themselves control about 80 per cent of the market in India. Smaller rivals such as Alvarez & Marsal, FTI and Kroll [two US-based companies] control the rest.

Suffice it to say, the Big 4 aren't afraid to fight the elite bar in virtually any jurisdiction, as they have deep pockets and a large number of lawyers on their payroll, all of whom, we can be quite sure, are not engaged in the practice of law, whatever that term means.  

This is the beginning of the end of an era, and that's a good thing.  We lawyers/legal professionals will reinvent ourselves by finding new ways to add value.  In fact, that is already happening.  In the long run, we'll feel richer for it. Below is an infographic from The Times story that summarizes the Indian lawyer-accountant standoff.


September 16, 2015 in Cross industry comparisons, Current events, New and Noteworthy, Structural change | Permalink | Comments (0)

Wednesday, September 9, 2015

"In Praise of Law Reviews (And Jargon-Filled, Academic Writing)"

SunsteinThat is the title of a forthcoming article by Cass Sunstein in the Michigan Law Review.  Sunstein has unusual standing to make this case because, in addition to his academic perches at Chicago and Harvard Law, he was tapped by President Obama to lead the Office of Information and Regulatory Affairs

Sunstein has written a remarkably thoughtful and balanced essay that I would encourage any fairminded lawyer, law student, and law professor to read.  Sunstein begins by recounting how pulling the levers of power in government made several of his fellow academics despair over the prospect of returning to academic writing. When Sunstein probed further, a colleague sent along a passage from Theodore Roosevelt:  

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood ... ."

It's a powerful passage that can be used to diminish those who write academic articles. But Sunstein subsequently references another quote, this one from John Maynard Keynes:

[T]he ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.

Sunstein acknowledges that Keynes' message is self-serving and unnecessarily demeans the intellect of those who carry the burden of leadership. But he also sees a kernel of truth--difficult problems often get solved by applying the grand ideas and concepts of academics.  The impact of academics is rarely immediate, but it can be enduring and profoundly influential.

To illustrate his point, Sunstein identifies a list of seven recent books by academic authors (by Balkin, Vermeule, Mashaw, Kaplow & Shavell, Revesz & Livermore, Cross, and Adler). All of them can trace their origins to earlier law review articles, all of them are hunting "big game", and most if not all of them are unlikely to be of immediate practical to the busy practitioner or judge.  But Sunstein suggests that we should be taking a longer view. Some of these books were on his shelf when he served in the government. He used them to address real world problems. The rest are scaffolding to reach something higher.

Sunstein organizes the core of his essay around the criticisms of the late Yale law professor Fred Rodell, suggesting that the author of the famous Goodbye to Law Reviews got it only half right.  Sure, the style and length of law review articles limit their readership, but Sunstein observes some countervailing benefits:

When they are working well, law reviews strongly discourage arguments that are glib, sloppy, circular, or narrowly ideological. They also require both development of and sympathetic engagement with competing points of view, rather than easy or rapid dismissals. Counterarguments are strongly encouraged, even mandatory. There is a kind of internal morality to the genre, one that is (I think) connected with and helps account for some of its rigidity. The morality involves respect for the integrity of the process of argument, which entails respect for a wide range of arguers as well. 

As someone who has written numerous law review articles, this description strikes me as entirely accurate.  Most of my work these days is applied--designing and measuring law school courses, evaluating outcomes, and trying to re-start the labor market so it clears on something more that LSAT scores of entering students.  Within this applied realm, which borders on the arena, I am often viewed as someone who is highly creative.  Yet, I can safely say that nearly all of the credit goes to the mental discipline and knowledge obtain through academic writing. That process fundamentally transformed my intellect. Further, I felt that way at the end of my first law review comment, which took roughly 500 hours to research and write during my 2L year of law school.  So I wanted to do it again.  

A lot of smart people in law tend to focus on what is immediate and practical--i.e., what will help with the work on their desk.  I can see this mindset in nascent form in a subset of my students who become impatient with classroom forays into legal theory or the social sciences.  I don't think this group can be won over.  By disposition, they can't see the value in reading academic work, so paying for its production seems even more pointless.

Granted, this conclusion does not resolve the harder issue of whether the current system of legal education over-incentivizes the production of legal scholarship by mandating, through ABA and AALS requirements, that most teachers be academic scholars. What is the optimal number of lawyer-scholars who should be subsidized by student tuition as opposed to grants or endowment? It may be less than the current number. Further, how those spots get allocated is another challenging issue with no simple resolution.  

That said, Sunstein is clearly right--whether they realize it or not, every capable legal problem-solver is standing on the shoulders of prior academic work.  It is misguided to conclude that future generations won't need new and better ideas vetted through an academic process.

September 9, 2015 in New and Noteworthy, Scholarship on legal education | Permalink | Comments (1)

Tuesday, September 1, 2015

What's driving the demographic gap between BigLaw leaders and their CEO/GC clients?

Picture1Las Vegas, NV.  The illustration to the left was just published in The American Lawyer.  It accompanied a story on how law firm leaders are significantly older than leaders in the large corporations they serve. See MP McQueen, The Generation Gap:  BigLaw's Aging Leaders, Aug 24, 2015. 

At least for me, this is a jarring graphic because it conveys so much truth.  Today's Millennials are so underwhelmed with the BigLaw model.  They like the pay and the perks, as it enables them to live well in attractive large market cities.  They can also quickly pay off their law school debt.  But precious few of them are all in. Illustrator James Steinberg totally nailed it.

There are numerous reasons for the culture divide, but as shown in the chart below, the most obvious is a very large age gap between leaders and entry-level workers -- it tends to be a lot larger in BigLaw than almost anywhere else: 4% of AmLaw 100 leaders are Gen X compared to 33% of NASDAQ-traded companies. 

These data beg the question, why are large law firms so out-of-sync with the institutions they serve?

One reason is certainly the ownership structure.  Any Fortune 500 or NASDAQ-traded company that got this top-heavy in its senior management would be getting killed on its stock price.  Under the Rule 5.4 prohibition on nonlawyer investors, law firms are spared the anxiety of having analysts and short sellers constantly evaluating their business. Yet, the absence of a public market means that law firm owners and managers cannot fully monetize the enterprise value they create. So what's the effect?  Very little enterprise value gets created.  Instead, lawyer/owners  focus on maximizing this year's net distributable income.

It is important to not knock the BigLaw model too hard.  For about a century, it worked extremely well, as US law firms steadily grew with their clients.  Each unit of economic growth produced some larger unit increase in legal complexity, so demand for sophisticated legal services was a steady upward sloping line. By following a simple model -- hire more associates, promote some to partners, lease more office space, repeat -- equity partners in the AmLaw 100 became millionaires.  

Today, BigLaw is getting grayer because the 100-year old gold factory is breaking down. Law firms' portion of corporate legal spending is no longer growing, as in-house lawyers, NewLaw managed services shops (United Lex, Axiom, Counsel on Call), and technology are all curbing demand for traditional law firm services.   The best economic play for 55- or 60-year old equity partner is to ride out the existing model with the dwindling but still substantial number of Baby Boomer senior in-house lawyers who are themselves not too anxious to change.  

This is not the story equity partners tell themselves; it's the logic that underlies the inertial path.  It's where we end up when we are no longer deeply invested in the places we work.  It's become a job.  I am not judging here; I'm describing what I have observed through hundreds of conversations with large firm partners.

The result of this dynamic is that a large proportion of BigLaw--but certainly not all of it--is just tinkering at the margins of change. A law firm can become more cost-effective for clients, at least in the short to medium term, by reducing reliance on associates.  Associates are expensive and are, by definition, getting paid to learn.  For the last 15-20 years, firms have shifted their leverage model to counsel, staff attorneys and nonequity partners, where (a) there is little to no training, (b) the margins are higher, and (c) the clients can't complain about inefficient associates. This is the Diamond Model, which substantially cuts out the entry-level lawyer.  See The Diamond Law Firm: A New Model or the Pyramid Unraveling? (Dec. 2013); Sea Change in the Legal Market, NALP Bulletin, Aug. 2013.


Unlike the original Pyramid Model, invented by Paul Cravath circa 1910, the Diamond Model is not a carefully conceived business strategy. Rather, it's a way to maximize this year's and next year's net distributable income without making difficult strategic tradeoffs. Yet, in the longer term, which is no longer too far off, the Diamond Model is a disaster.  The few associates who make it into large firms are grateful for the high pay and the training.  But very few if any are impressed with the business model.  Among Millennial lawyers, in-house is the new brass ring.

Law firms are filled with brilliant people. Why are they going down this road?  Three interrelated reasons:

  1. Lack of Experience. Today's law firm partners have little or no experience with strategy--for a hundred years, intelligence and hard work worked just fine.  This is not a change in strategy--it is having a strategy.  Then executing.  That's hard.
  2. Incentive Structures. Virtually all incentives inside firms today favor revenue generation; as a result, few partners have the mental whitespace to understand, much less think through, the changes that are occurring within the broader industry.  To fix the bridge, you have to slow down the traffic.
  3. To Big to Fix.  The first strategy mistake for the current generation of AmLaw 100 leaders was to become bigger without becoming measurably better.  Big firms filled with laterals is a difficult environment to share risk. Maximizing this year's distributable income becomes one of the few things people can agree on.

That said, I am not counting BigLaw out.  I am writing this blog post from the International Legal Technology Association (ILTA) conference in Las Vegas.  From far away, it is all too easy to treat BigLaw as a monolith--it's not.  At ILTA, professionals from several of the most innovative law firms are willing to pop the hood and share what they doing.  See Ahead of the Curve: Three Big Innovators in BigLaw, Aug. 25, 2014Suffice it to say, some firms are several years into strategies that have the potential to take market share from peer firms.  Further, the innovation teams inside these firms are having the time of their professional lives because the work is so collaborative and creative--the antithesis of billable hour work.  What is also clear is that many competitors just can't muster the leadership nerve to make similar investments. 

In the years to come, some BigLaw firms are going to pull away from the rest, becoming a magnet for talent and then clients.  Younger lawyers are going to thrive there.  Another portion of BigLaw is going to gradually fade away. 

September 1, 2015 in Current events, Data on the profession, Law Firms, Structural change | Permalink | Comments (3)

Wednesday, August 12, 2015

Of Transfers and Law-School-Funded Positions

1.      Many Elite Law Schools with Large Numbers of Transfers also Have Large Numbers of Law-School-Funded Positions

Several weeks ago, I participated in two separate conversations.  One was about when law-school-funded positions should be categorized as full-time, long-term, bar-passage-required (FLB) positions and one was about transfer students.  This prompted me to compare those schools that are “big players” in law-school-funded positions with those schools that are big players in the “transfer” market.  Interestingly, as shown in the chart below, there is a significant amount of overlap.

For the Class of 2014, of the 15 law schools with the most graduates in FLB positions, ten had a significant (net) number of transfer students in the summer of 2012.  (The chart is sorted based on 2014 FLB positions (in bold).  To provide context, the chart also includes the 2011 net transfer data and 2013 law-school-funded FLB data for these 10 schools.)

Law School

2011 Net Transfers

2013 Law-School-Funded FLB

2012 Net Transfers

2014 Law-School-Funded FLB

























































Note that in both 2013 and in 2014, six of the ten schools had more transfers than law-school-funded positions, suggesting that had they taken fewer transfers they might not have needed to provide as many law-school-funded positions. Phrased differently, this data suggests that with the transfer students, these law schools have too many graduates compared to the number of jobs the market is able to provide for their graduates.

2.      Adjusting to the Employment Market or Continuing to Attract Transfers and Provide Law-School-Funded Positions?

One might expect that a natural response to this “mismatch” between the number of graduates and the number of meaningful employment opportunities provided by the market would be to have fewer graduates (and fewer law-school-funded positions).  Indeed, for many of the schools in the chart above, the simplest way to do this would involve not accepting any transfer students (or accepting very few transfer students).  The first-year enrollment at these schools appears to be fairly-well calibrated with the number of meaningful employment opportunities provided by the market.  Of course, this would mean a significant loss of revenue.

But what happened at these ten law schools in the summer of 2013 and the summer 2014 with respect to transfer students? As shown in the chart below, almost all have continued to take large numbers of transfer students.  With knowledge that a not insignificant percentage of their graduates need the support of law-school-funded positions because they can’t find market positions, these law schools continue to take large numbers of transfers.  Indeed, the total number of net transfers at these ten law schools is even higher in 2013 and 2014 than in 2011 and 2012.



2014   Net Transfers

2013   Net Transfers




































3.   Why are These Schools Continuing to be Big Players in the Transfer Market and in Providing Law-School-Funded Jobs and Why Aren’t Other Schools Doing This as Well?

Many elite law schools are participating heavily in the transfer market and in providing law-school-funded jobs because they can and because it makes financial sense to do so.

As a general matter, only relatively elite law schools are able to attract large number of transfer students willing to pay $50,000 per year in tuition.  (This assumes that most transfers are paying full tuition. There is very little information available about scholarships in the transfer market, but anecdotes suggest that scholarships are uncommon.)  By taking large numbers of transfers, these schools generate revenue that funds general operations AND enables the school to fund post-graduate employment opportunities for a significant number of graduates.  According to NALP, most graduates in law-school-funded positions receive salaries of roughly $15,000-$30,000 per year.  Even if they have as many law-school-funded positions as they do transfers, the schools still net $70,000 to $88,000 per transfer student over the second and third year of law school even after accounting for the salaries for law-school-funded positions. (To be fair, some modest percentage of law-school-funded positions at several of these law schools may be great opportunities that are highly competitive and pay a salary comparable to a market salary – in excess of $40,000 per year.  Some of these may be public interest opportunities that some students find particularly attractive.  But the proliferation of law school funded positions (having grown from just over 500 in 2012 to more than 800 in 2014), with most of the growth occurring at relatively elite law schools, suggests that many of these positions do not fit the profile described in the preceding two sentences.)

Other schools would love to do this, but most simply don’t have the ability to attract significant numbers of transfer students.  Moreover, in the present legal education environment with declining enrollment at most schools, many law schools are running a deficit, and simply can’t afford to invest money in law-school-funded positions for their graduates.

Notably, up until this year, this effort was aided by the reporting of law-school-funded jobs as if they were the same as jobs provided by the market.  A school with law-school-funded positions that otherwise met the definition of FLB positions could report a higher percentage of its graduates in such positions.  This minimized the extent to which less than robust employment results might erode the schools’ ability to attract students and has allowed these elite schools to continue to attract large numbers of relatively highly-credentialed entering students (and transfers) along with the revenue they bring to the school.  For the Class of 2015, however, these law-school-funded positions will be reported separately from FLB positions provided by the market.

4.      What Questions Might this Raise for Students?

Students considering transferring to one of these elite schools should ask two questions: 1) What percentage of law-school-funded positions went to transfer students? and 2) How do employment outcomes for transfer students compare with employment outcomes for students who began at the school as first years?  (Even with the increased attention on transparency with respect to employment outcomes, one data point not presently collected relates to employment outcomes for transfer students.)  This isn’t to suggest that all transfers end up in law-school-funded positions.  Some transfer students may outperform some of the students who began at a law school as first years, both in terms of academic performance and in terms of relationship skills.  These transfer students may outcompete original first-year students for market employment opportunities.  But students considering transferring might want to assess whether their employment prospects really will be better at the school to which they might transfer as compared with the opportunities available to them if they remained at the school from which they are considering transferring, particularly if they are near the top of the class at the school from which they are considering transferring.

Students who had matriculated as first-years at one of these elite law schools, might want to ask the law school administration how and why having a large number of transfers is a good thing for those who matriculated as first-years at the elite law school.  Having the additional revenue might enhance the educational experience in some way, but having significantly more students competing for jobs would seem to be an unnecessary challenge. 

5.      Conclusion

The data on transfers in 2013 and 2014 suggests that at many elite law schools, there will continue to be more graduates than jobs provided by the market.  As a result, these law schools are likely to continue to provide law-school-funded positions for some number of their graduates. Indeed, the prospect of law-school-funded positions as a fall-back option if a market position is not available might provide some solace for students, including transfer students, at these elite law schools. 

Nonetheless, there is a further ripple effect.  With dozens of graduates from these elite law schools in law-school-funded positions looking for market jobs, it makes it even more challenging for the next year’s graduates from these elite schools to find market jobs and almost assures that many graduates will still need the support of law-school-funded positions in the coming years.

(I am grateful to Bernie Burk and others for helpful comments on earlier drafts of this posting.)

August 12, 2015 in Data on legal education, Data on the profession | Permalink | Comments (0)

Thursday, August 6, 2015

How is the entry-level legal job market in Australia?

AlsaNot good.  There are more law graduates than jobs, yet law schools are making matters worse by admitting more students in order to generate subsidies for other parts of the university. That the basic charge of the Australian Law Students Association (ALSA), according to this story in the Lawyers Weekly, a publication that covers the business of law in Australia.

Legal education is Australia is very different than the U.S.,  yet the dynamics of the two entry-level markets seem to be converging.  Law has historically been an undergraduate degree in Australia (LLB), but in recent years the JD has been added as a new and more prestigious way into the profession. Here is the statement of an ALSA spokesperson based on recent survey results of the ALSA membership.

ALSA are of the position that there is still an oversupply of graduates because of the increasing sizes of law schools and the duplication in the number of law schools across the country. ...

Many who have undertaken the Juris Doctor particularly expressed concerns in their survey responses, highlighting that they undertook the postgraduate law degree to further their job prospects. Instead, they are facing the worrying reality that there are fewer jobs available for law graduates as well as the fact that they are completing their degrees with a sizeable student debt.

The article then goes on to describe growing law student anxiety over employment and student loan debt.  Wow, different system but a very similar result.  

One of the advantages of the Australian LLB degree is that it is often combined with another undergraduate degree, typically by adding one year of additional study.  As a result, many LLBs don't go on to qualify for practice, but the legal training probably augments their worldly knowledge and critical thinking skills.  But alas, the Australians are starting to dilute their extremely generous higher education subsidies -- we are just much further down that road. Further, the true undercurrent here is the growing insecurity facing virtually all knowledge workers, Australian or US.  Legal education is just the bleeding edge of this problem.

August 6, 2015 in Current events, Data on legal education, Data on the profession, New and Noteworthy | Permalink | Comments (0)

Tuesday, August 4, 2015

Metrics and Legal Ops Professionals

In a recent post, I urged readers to visit a legal department with a large legal operations staff.   The goal?  To see the future of modern corporate law practice.  Fortunately, Bloomberg Law recently videotaped a legal ops panel moderated by Amar Sarwal of the ACC.  It contains a conversation rarely if ever heard in law schools or bar associations.

The three legal departments profiled are AIG (insurance), Marsh & McLennan (diversified financial and professional services), and GlaxoSmithKline (pharma).  Note the enormous emphasis on metrics, data, and technology.  Note also how the services of law firms are being put through a procurement process. 

August 4, 2015 in Blog posts worth reading, Current events, Data on the profession, Law Firms, Legal Departments, New and Noteworthy, Video interviews | Permalink | Comments (0)