Wednesday, July 29, 2015

"Solicitors 'in denial' about threat from accountants"

Legalservices (321x207)That's the headline from today's Law Society Gazette, the publication of record for solicitors in England and Wales.  The UK is fairly far along in liberalization of its legal markets, progressing from the Clementi Report in 2004 to the Legal Services Act 2007 to the licensing of Alternative Business Structures in 2012.  Now several hundred entities have obtained ABS status.  

The Gazette article reports that accountants are poised to be large players in the ABA space:

Accountants will soon be competing directly with solicitor firms ‘on every high street in the country’, according to a leading financial advisor to the legal sector.

Ian Muirhead, chairman of Solicitors Independent Financial Advice, said he expects 750 accountancy firms – three times more than first envisaged – to move into probate work after securing an alternative business structure licence.

The Institute of Chartered Accountants in England & Wales has accredited 113 entities as an ABS since last October, having been accepted as an approved regulator almost a year ago. A further 34 applications are being processed.

Speaking at a Westminster Legal Policy, Muirhead said too many solicitor firms are ‘in denial’ about the threat from the accountancy profession.

‘Success will go to those who can manage businesses and I query whether that’s going to be the solicitors or whether solicitors are going to be the back room boys,’ he said.

Muirhead argued that law firms’ response so far has been focused on consolidation, mergers and acquisitions – but this risks playing into rivals’ hands.

‘[The response is] safety in numbers, more of the same, not thinking outside the legal silo, and therefore missing the opportunity of which many new ABSs are availing themselves, of providing a more diversified and holistic client service,’ he added. ... 

Some U.S. lawyers believe that liberalization won't come to the U.S. because the legal industry is too balkanized by state bar authorities.  

I think this view, however, is likely naive. The market can change because regulators change the rules (the UK). Alternatively, the market can change because clients change their buying habits in favor of nontraditional legal service providers that are financed by sophisticated nonlawyer investors (the US).  See, e.g., Is Axiom the Bellwether for Disruption in the Legal Industry, LWB, Nov. 10, 2013.

In the US, it is probably true that regulators lack the stomach to initiate a regulatory action where the client ostensibly being protected is a Fortune 500 corporation.  If the action ends up in federal court, the bar officials risk looking like protectors of the guild and have a decent chance of losing.  The prohibition against nonlawyer investment (MR 5.4) is based on the assumption that the nonlawyer profit motive will compromise lawyer independence, thus harming the unwitting and unsophisticated legal consumer.  But that does not describe IBM's or JP Morgan's relationships with sophisticated LPO or analytics shop (or any general counsel charged with stretching his or her legal dollar). As a result, the venture capital money flows in.

When liberalization is viewed in this light, there are probably more similarities between the US and UK than we might want to acknowledge. 

July 29, 2015 in Current events, Data on the profession, Innovations in law, Law Firms, New and Noteworthy, Structural change | Permalink | Comments (0)

Wednesday, July 22, 2015

What is more important for lawyers: where you go to law school or what you learned? (Part II)

If you're trying to maximize the financial value of an undergraduate degree, it is better to bet on course of study than college prestige.  Indeed, prestige is largely irrelevant to those who major in engineering, computer science, or math.  In contrast, prestige does matter for art & humanities grads, albeit the financial returns are significantly lower than their tech counterparts.  

These are some of the takeaways from Part I of this blog post. Part I also presented data showing that law is a mix of both: financial returns have been high (cf. "red" tech majors) and prestige matters (cf. "blue" arts & humanities crowd).  

The goal of Part II is to address the question of whether the pattern of high earnings/prestige sensitivity will change in the future. I think the answer to this question is yes, albeit most readers would agree that if law will change is a less interesting and important question than how it will change.  Speed of change is also relevant because, as humans, we want to know if the change is going to affect us or just the next generation of lawyers.

Shifts in the Legal Market

There are a lot of changes occurring in the legal market, and those changes are altering historical patterns of how legal services are being sold and delivered to clients. In the past, I have thrown around the term structural change, yet not with any clear definition.  To advance the conversation, I need to correct that lack of precision. 

In economics, there is a literature on structural change as applied to national or regional economies (e.g. moving from a developing nation to an industrial nation; or moving from an industrial to a knowledge-based economy).  Investors also focus on structural change within a specific industry because, obviously, large changes can affect investor returns.  When I have used the term structural change on this blog, it has been much closer to investor conceptions.  Investopedia offers a useful definition even if it's somewhat colloquial: 

Definition of 'structural change': An economic condition that occurs when an industry or market changes how it functions or operates. A structural change will shift the parameters of an entity, which can be represented by significant changes in time series data.

Under this definition, the legal industry is certainly undergoing structural change.  The proportion of law graduates getting a job in private practice has been on the decline for 30 years; over the last 35 years, the average age of the licensed lawyer has climbed from 39 to 49 despite record numbers of new law school graduates; the proportion of associates to partners has plummeted since the late 1980s.  See Is the Legal Profession Showing its Age? LWB, October 12, 2014.  Since the early 2000s, long before the great recession, associate-level hiring has been cut in half. See Sea Change in the Legal Market, NALP Bulletin, August 2013.

Likewise, among consumers of legal services, there is a lot of evidence to suggest that lower and middle class citizens can't afford a lawyer to solve life's most basic legal problems, thus leading to a glut of pro se litigants in state courts and many more who simply go without things like contracts and wills.  This troubling trend line was obscured by a boom in corporate legal practice, albeit now even rich corporations have become more sensitive to legal costs -- the sheer volume and complexity of legal need is outstripping their budgets.  In response to the lag in lawyer productivity and innovation, there is a ton of investor-backed enterprises that are now elbowing their way into the legal industry.  See A Counterpoint to "the most robust legal market that ever existed in this country"LWB, March 17, 2014.  

The impact of all this change -- structural or otherwise -- is now being felt by law schools. Applicants are down to levels not seen since the 1970s, yet we have dozens more law schools. It has been said by many that law schools are losing money, albeit we have zero data to quantify the problem.  Based on my knowledge of my own law school and several others I am close to, I am comfortable saying that we have real changes afoot that affect how the legal education market "functions or operates."

There is a sense among many lawyers and legal academics that the legal world changed after 2008. None of the "structural" changes I cite above are pegged in any way to the events of that year.  

What did change in 2008, however, was the national conversation on the legal industry, partially due to the news coverage of the mass law firm layoffs, partially due to important books by Richard Susskind and later Brian Tamanaha and Steve Harper, and partially due to a robust blogosphere.  This change in conversation emboldened corporate legal departments to aggressively use their new found market power with "worthless" young associates becoming the biggest casualty. This new conversation in turn exposed some of the risks of attending law school, which affected law school demand.  But alas, this was all fallout from deeper shifts in the market that were building for decades. Let's not blame the messengers.

Dimensions of Change

I am confident that the future of law is going to be a lot different than its past. But I want to make sure I break these changes into more discrete, digestible parts because (a) multiple stakeholders are affected, and (b) the drivers of change are coming from multiple directions.

Dimension 1: basic supply and demand for legal education

To unpack my point regarding multiple dimensions, let's start with legal education. Some of the challenges facing law schools today are entirely within the four corners of our own house.  Yet, legal education also has challenges (and opportunities) that arise from our connection to the broader legal industry.  This can be illustrated by looking at the relationship between the cost of legal education (which law schools control, although we may blame US News or the ABA) and entry level salaries (which are driven largely by the vagaries of a client-driven market).  

The chart below looks at these factors.  My proxy for cost is average student debt (public and private law schools) supplied by the ABA.  My income variables are median entry level salaries from NALP for law firm jobs and all entry level jobs.  2002 is the first year where I have all the requisite data.  But here is my twist:  I plot debt against entry-level salary based on percentage change since 2002.  

Debtversusincome-2002

If a business nearly doubles its price during the same period when customer income is flat, demand is going to fall.  Thus, the sluggish entry-level market presents a difficult problem for legal education.  Sure, we can point to the favorable statistics from the AJD or the premium that a JD has historically conferred on lifetime earnings, but law professors are not the people who are signing the loan papers.  The chart above documents a changing risk/reward tradeoff.  To use the frame of Part I, the red dots are sinking into the blue dot territory, or at least that is the way prospective students are likely to view things.

Fortunately, smaller law school classes are going to be a partial corrective to low entry-level salaries.  The biggest law school class on record entered in the fall of 2010 (52,488); in 2014, the entering class had shrunk by over 27% (37,942). When entry-level supply is reduced by 25+%, upward pressure on salaries will build.  Yet, the composition of the legal economy and the nature of legal work is clearly changing.  Further, the rate of absorption of law school graduates into the licensed bar has been slowing for decades.  See Is the Legal Profession Showing its Age? LWB, October 12, 2014. It would be foolhardy to believe that time and fiscal austerity alone are going to solve our business problems. Instead, we need to better understand our role as suppliers to a labor market.

Dimension 2:  The content of legal education

The content of legal education is not necessarily fixed or static.  We could change the content, thus affecting how the market responds.  

To provide a simple example, one of my students is starting work this fall at Kirkland & Ellis.  From a financial perspective, this is a good employment outcome.  He will be moving to Chicago with his girlfriend who just received her MS in Information Systems from IU's Kelley School of Business.  The MS from Kelley is a very "red" degree.  It can also be completed in one year (30 credit hours).  Well before she graduated, this recent grad had competing offers from PWC and Deloitte, both in the $80,000 range.   For many Indiana Law students, an ideal post-grad outcome would be $80K in Chicago at an employer who provides challenging work and high-quality training.  Yet, my student's girlfriend got this ideal outcome in 1/3 the time and likely 1/2 the cost of an Indiana Law grad.  

Perhaps we should consider cross-pollinating these disciplines. A huge portion of the legal profession's economic challenges is attributable to flat lawyer productivity -- customers are struggling to pay for solutions to their legal needs.  Information systems are a huge part law's productivity puzzle.  Below is a chart I use in many of my presentations on the legal industry.  The chart summarizes the emerging legal ecosystem by plotting the Heinz-Laumann two-hemisphere model against Richard Susskind's bespoke-to-commodity continuum. [Click-on to enlarge.]

Ecosystem

The key takeaway from this diagram is that the largest area of growth is going to be in the multidisciplinary green zone -- the legally trained working shoulder-to-shoulder with those skilled in information systems, statistics, software development, and computational linguistics, to name but a few.  These are "red" disciplines.  Do law schools want to be part of this movement?  Let me ask this another way -- do law schools want to be relevant to the bulk of the legal market that needs to be rationalized in order to maintain its affordability? Harvard grads will have options on Wall Street for the foreseeable future.  But 98% of law schools operate in a different market.  Further, some HLS grads, or students who might qualify for admission to Harvard, might prefer the big upside rewards that are only available in the green zone.  In short, a new hierarchy is emerging in law that is still very much up for grabs.

If an academic wants to better understand the rapidly changing nature of legal work, I would urge them to visit a large legal department with a substantial legal operations ("legal ops") staff.  These are the professionals who have been empowered by general counsel to find ways to drive up quality and drive down cost using data, process, and technology.  These are the folks who are making build-versus-buy decisions, putting pressure on law firms to innovate in order to hang on to legal work, and experimenting with NewLaw legal vendors. 

I am finishing up a story on legal ops professionals for the ABA Journal.  (By the way, legal ops exist in law firms as well as legal departments and green zone legal vendors. The role is most developed, however, in legal departments.)  My editor flagged the issue that virtually all of the legal ops people in the story did not graduate from prestigious law schools (or any law school).

My only response is that legal operations people have specialized skills and knowledge (often "red" but sometimes involving EQ) that others lack; without these skills, they can't do the job.  Legal ops people live in a world of outputs and metrics.  For example, are legal expenses and settlement amounts trending down over time -- yes or no? If so, by how much?  How much internal staff time does it take to negotiate a revenue contract? How much of this process can be automated? What will it take to get our staff to accept the new system?

As these examples show, a legal ops person is typically going to be evaluated based on measurable outputs -- do they get results? Where someone went to law school is an input that is likely irrelevant to the question.  The only qualifier is whether the curriculum of that school provided valuable, specialized domain knowledge -- most likely non-legal red skills but also skills related to teams, communication, and collaboration. 

Dimension 3:  The value of pedigree to the customer 

Law has historically been what economists call a “credence good.”  This means that a layperson has a difficult time assessing quality.  As a result, proxies for quality, such as pedigree or prestige, have historically been very important when hiring a lawyer or law firm.  

One of the reasons that the field of legal operations is gaining momentum is because it is creating tools and systems that enable clients to look past credentials to obtain information on things they really care about, such as cost, outcome, and speed of delivery. There are now companies coming into existence that are gathering data on lawyers' win-loss rates. See Another Example of Using Big Data to Improve Odds of Winning in Court, LWB, April 12, 2015.  Sure, apples-to-apples comparisons are very difficult to make -- every case is unique in some respect. But the amount of money at stake is large enough that the data challenges will be surmounted.  When that day arrives, we won't opine on the value of pedigree to legal outcomes; we'll just calculate it. More significantly, clients focused on outcomes will change their buying patterns.  Early returns I have seen suggest that the value of pedigree to legal outcomes may be close to negligible.

Do any of us care where the engineers who designed our smart phones went to college? Not really. We just care how well the smart phone works. 

In this respect, the future of law is likely headed in the direction of Google (a pure red company).  In the early days, the founders of Google favored grads of Caltech, Stanford and Berkeley.  But over time, the company learned that prestige of graduate school was a poor predictor of job success. Because Google lives and dies by its outputs, the company changed its hiring model to attract the most qualified engineers.  See George Anders, The Rare Find: How Great Talent Stand Out 1-5 (2012) (telling the story of how data changed the attitudes of Google founders regarding elite credentials and altered the Google hiring model).

I have lived long enough to know that the changes I describe above are not necessarily going to be welcomed by many lawyers and law professors.  If a group benefits from a lifelong presumption of merit, it is natural that group will resist evidence that the presumption is not fully warranted. Indeed, much of the skepticism will be rooted in subconscious emotion.  If the presumption is dashed, those of us in the elite crowd will have to spend our days competing with others and proving ourselves, or even worse, watching our kids soldier through it.  We have little to gain and a lot to lose in the world we are heading into.  Yet, behind the Rawls veil of ignorance, how can we complain?

So with the red-blue crosscurrents, is law school still worth the investment?

That is a relevant and reasonable question that many young people are contemplating.  I will offer my opinion, but markets are bound to follow their own logic. 

This is a time of enormous uncertainty for young people. Education clearly opens doors, but tuition is going up much faster than earnings.  Further, competition among knowledge workers is becoming more global, which is a check on wages.  Of course, if you don't invest in education, what are your options?

I am generally on the side of Michael Simkovic and Frank McIntrye that the education provided by a law degree, on average, significantly increases lifetime earnings.  See The Economic Value of a Law Degree (April 2013).  How could it not?  The law is too interconnected to every facet of society to not, on average, enhance the law grad's critical thinking skills. Nearly 15 years of out of law school and I regularly use what I learned at Chicago Law to solve problems and communicate solutions, particularly in my applied research work with law firms and legal departments. While my Chicago Law credential has value independent of the skills and knowledge I obtained (the red AJD bar chart in Part I strongly suggests that), I can't deny the additional value of the actual skills and knowledge I obtained to solve real world business problems. It's been substantial.

In general, I also agree with Deborah Jones Merritt that there is significant evidence that the entry-level market for lawyers is weak and oversaturated.  See What Happened to the Class of 2010? Empirical Evidence of Structural Change in the Legal Profession (April 2015).   The class of 2010 is not faring as well as the class of 2000.  Indeed, the lead economist for Payscale, Katie Bardaro, recently noted that wages are stagnating in many fields, but especially in the legal profession. "More law schools are graduating people than there are jobs for them...There’s an over-saturated labor market right now. That works to drive down the pay rate.” See Susan Adams, The Law Schools Whose Grads Earn the Biggest Paychecks in 2014, Forbes, Mar. 14, 2014. 

In the face of these stiff headwinds, I think law schools have an opportunity to pack more value into three years of education. See Dimension 2 above.  To be more specific, if you are a protege of Dan Katz at Chicago-Kent, you will have a lot of career options. Ron Staudt, also at Chicago-Kent, has quietly built a pipeline into the  law and technology space.  Oliver Goodenough and his colleague at Vermont Law are making rapid progress with a tech law curriculum.  And at Georgetown Law, Tanina Rostain and Ed Walters (CEO of Fastcase) provide courses that are cutting edge.  

But absent these types of future-oriented instruction, what is the value of a JD degree as it is commonly taught today? That value is clearly positive; I would even call it high.  But whether the value is sufficient to cover the cost of attendance is likely to vary from law grad to law grad.  Lord knows, in a world of variable tuition based on merit scholarships and merit scholarships that go away after the 1L year, the swing in cost can be a $250K plus interest.

What is killing law school applications these days is the lack of near certainty among prospective students that the time and expense of law school will pay off.  The world looks different than it did in the fall of 1997 when the vast majority of the AJD respondents entered law school. Tuition and debt loads are higher and high paying entry-level jobs are harder to obtain.

So what is the solution?  For students, it's to bargain shop for law schools, which is bad news for law schools.  For law schools, it's to add more value to an already valuable degree.  Some of that value will come in the form of red technical skills that will make lawyers more productive.  In turn, this will prime demand for more legal products and services.

July 22, 2015 in Blog posts worth reading, Data on legal education, Data on the profession, Legal Departments, Structural change | Permalink | Comments (0)

Sunday, July 19, 2015

What is more important for lawyers: where you go to law school or what you learned? (Part I)

The Economist reports a very interesting analysis from Payscale.  The questions being asked are pretty simple: If you want to generate earnings that justify the time and cost of an undergraduate education, what should you study and where should you enroll?

Lots of people have strong opinions on this set of questions, but Payscale has the data to answer them empirically. It turns out that at the undergraduates level, course of study is much more important than the prestige of the college or university you attend.  The hard evidence is shown below.

Payscalegraphic

For those working in law or thinking about attending law school, a natural question to ask is whether the legal industry is closer to the blue dot (art & humanities) or red dot pattern (engineering/CS/math).  A second, related question whether the future of law is more blue or more red.

This a two-part blog post.  Part I tries to answer the first question, starting with a careful analysis of the undergraduate chart, which provides a valuable frame of reference that can be discussed more dispassionately (at least among lawyers and law students) than an analysis that questions the value of law school prestige and hierarchy.  

Part II, which I will post on Wednesday, explores the second, future-oriented question.  I will tip my hand now and say that the future of law will be less blue (arts & humanity) and more red (math/CS/engineering).  Within the legal industry, there will be winners and losers; but from the perspective of broader society, this change is a very good thing. 

Undergraduate ROI

In the Payscale chart above, the y-axis (vertical) is 20-year annualized returns from college fees paid.  The x-axis is selectivity, running from under 10 percent to near open admissions.  

The Payscale chart is a very good example of how data visualization can be used to communicate both core facts and useful nuance.  Here, the lede is unmistakable:  the red dots (engineering/CS/math) are overwhelming higher on the ROI scale than the blue dots (arts & humanities).  Sure, there are exceptions to this rule, but they don't occur very often. (Observe how rarely a blue dot is above the red fit-line.) This suggests it would be very foolish to get a blue degree and expect a red paycheck unless you have very good information (or skills or talent) that others lack.

The chart conveys another important piece of information -- the red fit-line is flat.  This means that for engineering/CS/math majors, prestige has not been very relevant to their eventual earnings.  I'll add a nuance here that some empirically savvy readers are bound to point out:  It is possible (indeed likely) that fees are higher at more selective schools. So if MIT costs twice as much as a public polytech, and both yield 12% over 20 years, one might wish they had gone to MIT.   Still, the flat trendline is surprising.  As a general matter, lower ranked schools are not dramatically cheaper than higher ranked schools, and many public schools are highly selective.  The flat red trendline suggests that there are (or were, remember these are historical data) many bargains out there.  If one is trying to maximize financial returns, the goal is to find a school that will, in the future, be well above the red fit-line (and avoid those below).  

The flat red fit-line is also surprising because college selectivity is almost certainly highly correlated with ACT or SAT scores, which our society often views as measures of general intelligence. Yet, there we have it -- a flat trendline. Four years of education seem to be more relevant than a standardized test score taken during high school.  That is heartening at many levels.

A third interesting trend -- the blue fit-line is sloped downward.  This suggests that in the arts & humanities, selectivity/prestige does have a financial payoff.  I don't think this will surprise many readers, albeit the prestige payoff is not very large. To use a simple metaphor, if you attend a more selective college or university to get your arts or humanity degree, you are likely to have a better house in the arts & humanities neighborhood.  But on average, you won't be able to afford the same neighborhood as the engineers, computer scientists, and math majors.

What about Law?

Moving on to law, if we want to examine the relationship between earnings and law school attended, the best available evidence is probably the After the JD Study (AJD), which is large, representative sample of law graduates who took and passed the bar in 2000.  

Data from AJD Wave 3 suggests that the financial returns are relatively strong for all law school graduates -- ten years out and graduates of Tier 4 schools have median earnings of $100,000 per year. As shown in chart below, this is akin to shifting the blue dots up into the red territory.  

AJDearnnings

The downward sloping fit-line remains, but that doesn't seem to matter very much to happiness. Other AJD data shows that regardless of tier of graduating school, AJD respondents show relatively high and uniform satisfaction with (a) the decision to become a lawyer, and (b) the value of the law degree as an investment. By 2010, 48% of respondents had no debt; only 5.1% had more than $100K in educational debt remaining. 

This is all good news.  But is it reasonable to extrapolate forward and assume the past is a fairly accurate barometer of the present and the future? 

One way to address that question is to ascertain what has changed since 2000.  As noted earlier, the AJD sample was composed of law graduates who passed the bar in the year 2000. Figures published by NALP and the ABA show that the percentage of full-time bar passage required jobs has dropped significantly over the last 13+ years -- from 77.3% for the class of 2000 to 57% for the class of 2013. That is a huge delta.

Barpassagerequiredjob

One of the reasons why law school applicants have plummeted is that the career path from JD graduates has become murky.  And that is a good place to start Part II

July 19, 2015 in Blog posts worth reading, Cross industry comparisons, Data on legal education, Data on the profession, Structural change | Permalink | Comments (3)

Thursday, May 14, 2015

Further Thoughts on the July 2014 Bar Results -- A Response to Erica Moeser

Late last fall, Erica Moeser responded to a letter from Dean Kathryn Rand of the University of North Dakota (on behalf of a large number of law school deans), reiterating that the NCBE had double-checked its scoring of the MBE on the July 2014 bar examination and could find no errors in its calculations.  Erica Moeser also took to the pages of the December 2014 issue of The Bar Examiner to further validate her conclusion that the historic drop in the mean MBE scaled score is attributable solely to the fact that the class that sat for the July 2014 bar exam was “less able” than the class that sat for the July 2013 bar exam.  In January, Dean Stephen Ferruolo of the University of San Diego also wrote to Erica Moeser requesting the release of more information on which to assess the July 2014 bar examination results in comparison with previous years’ results.  In February, Erica Moeser responded to Dean Ferruolo’s request by declining to provide more detailed information and reiterating her belief that the July 2014 scores “represent the first phase of results reflecting the dramatic and continuing downturn in law school applications.”

In an earlier blog posting, I explained why Erica Moeser is partly right (that the Class of 2014 could be understood to be slightly less able than the Class of 2013), but also explained why the decline in “quality” of the Class of 2014 does not explain the historic drop in mean MBE scaled score.  The decline in “quality” between the Class of 2013 and the Class of 2014 was modest, not historic, and would suggest that the decline in the mean MBE scaled score also should have been modest, rather than historic.  Similar declines in “quality” in the 2000s resulted in only modest declines in the MBE, suggesting that more was going on with the July 2014 exam. 

Others have written about these issues as well.  In January, Vikram Amar had a thoughtful reflection on Moeser’s statements and in recent weeks Debby Merritt has written a series of posts -- here, here, and here -- indicating in some detail why she believes, as I do, that the ExamSoft debacle in July could have impacted the MBE scaled scores in jurisdictions that used ExamSoft as well as in other jurisdictions.

I write now to take issue with four statements from Erica Moeser – three from her President’s Page in the December 2014 issue of the Bar Examiner and one from her letter responding to Dean Kathryn Rand.  I remain unpersuaded that the historic decline in the mean MBE scaled score is solely attributable to a decline in quality of the class that sat for the July 2014 bar examination and remain baffled that the NCBE refuses to acknowledge the possibility that issues with test administration may have exacerbated the decline in the performance on the July 2014 MBE.

Item One – Differential Declines in MBE Scores

In her December article, Moeser stated: 

I then looked to two areas for further corrobo­ration. The first was internal to NCBE. Among the things I learned was that whereas the scores of those we know to be retaking the MBE dropped by 1.7 points, the score drop for those we believe to be first-time takers dropped by 2.7 points. (19% of July 2014 test takers were repeaters, and 65% were believed to be first-time takers. The remaining 16% could not be tracked because they tested in jurisdictions that col­lect inadequate data on the MBE answer sheets.) The decline for retakers was not atypical; however, the decline for first-time takers was without precedent dur­ing the previous 10 years. (Emphasis in original.)

Moeser starts by referencing data that is not publicly available to support her cause.  This is unfortunate, because it makes it really hard to understand and critique the data.  Nevertheless, there are some inferences we can take from what she does disclose and some questions we can ask.  Moeser asserts that the 19% of MBE “retakers” saw an MBE drop of 1.7 points compared with MBE “retakers” in July 2013, while the 65% believed to be first-time takers saw a drop of 2.7 points compared with first-time takers in July 2013.  It would have been helpful here if Erica Moeser would have released publicly the declines among MBE retakers in the previous 10 years and the declines among first-time takers in the previous 10 years so that patterns could be assessed, particularly in relation to the changes in class composition for each of those years.  Without that information available it is hard to do much more with Moeser’s assertion.  (I find it odd that she would reference this point without providing the underlying data.) 

Nonetheless, this assertion raises other questions.  First, the overall decline in the mean MBE scaled score was 2.8 points. Moeser notes that 19% of takers (MBE retakers) had an average drop of 1.7 points, while 65% of takers (first-time takers) had an average drop of 2.7 points.  Unless there is something I am missing here, that should mean the remaining 16% of test-takers had to have an average decline of 4.51 points!  (This 16% of test-takers represents those who Moeser notes could not be tracked as first-time takers or MBE retakers “because they tested in jurisdictions that collect inadequate data on the MBE answer sheets.”) (Here is the equation --- 2.8 = (.19*1.7)+(.65*2.7)+(.16*x).  Solve for X. This translates to 2.8 = .323+1.755+.16x.  This translates to .722 = .16x and then .722/.16 = X.  X then equals 4.51.)  It would have helped, again, if Moeser had indicated which jurisdictions had these even larger declines in mean MBE scaled scores, as we could then look at the composition of graduates taking the bar in those jurisdictions to see if there was an unusual decline in entering class statistics in 2011 at the law schools from which most bar takers in those states graduated.

Item Two – The MPRE

In the December article, Moeser also stated:

I also looked at what the results from the Multistate Professional Responsibility Examination (MPRE), separately administered three times each year, might tell me. The decline in MPRE performance supports what we saw in the July 2014 MBE numbers. In 2012, 66,499 candidates generated a mean score of 97.57 (on a 50–150 scale). In 2013, 62,674 candidates generated a mean score of 95.65. In 2014, a total of 60,546 candi­dates generated a mean score of 93.57. Because many MPRE test takers are still enrolled in law school when they test, these scores can be seen as presaging MBE performance in 2014 and 2015.

At first blush, this looks like a pretty compelling argument, but Moeser’s selectiveness in looking at the data is troubling, and her failure to discuss whether the MPRE and MBE are meaningfully comparable test-taking experiences also is troubling.  Essentially, Moeser is making the following assertion – because the mean MPRE scaled score declined by 1.92 points between 2012 and 2013, we should have expected a large decline in the mean MBE scaled score in July 2014 (and because the mean MPRE scaled score declined another 2.08 points between 2013 and 2014, we should expect another large decline in the mean MBE scaled score in July 2015).

But the “relationship” between changes in the mean MPRE scaled score and changes in the mean MBE scaled score over the last decade does not support this assertion. If one looks at a decade’s worth of data, rather than data just for the last couple of years, the picture looks significantly more complicated, and suggests the collective performance on the MPRE may not tell us much at all about likely collective performance on the MBE in the following year. 

MPRE Year

Mean MPRE Score

Change

MBE Year

July Mean MBE Scaled Score

Change

2004

99.1

 

2005

141.6

 

2005

98.7

-0.4

2006

143.3

+1.7

2006

98

-0.7

2007

143.7

+0.4

2007

98.6

+0.6

2008

145.6

+1.9

2008

97.6

-1.0

2009

144.5

-1.1

2009

97.4

-0.2

2010

143.6

-.9

2010

96.8

-0.6

2011

143.8

+0.2

2011

95.7

-1.1

2012

143.4

-0.4

2012

97.6

+1.9

2013

144.3

+0.9

2013

95.6

-2.0

2014

141.5

-2.8

2014

93.6

-2.0

2015

????

????

The data Moeser cites from the last two years conveniently makes her point, but it consists of a very small sample size.  The data over the last decade looks much more random.  In three of the nine years, the change is not in the same direction (MPRE 2005, 2006, 2010, MBE 2006, 2007, 2011).  In the six years where the change is in the same direction, there are two years in which the MBE change is significantly larger than the MPRE change (MPRE 2007, 2009, MBE 2008, 2010) and there are two years in which the MBE change is significantly smaller than the MBE change (MPRE 2011, 2012, MBE 2012, 2013).  In only two of the nine years, do the changes in the MPRE and MBE roughly approximate each other (MPRE 2008, 2013, MBE 2009, 2014).   Nonetheless, this remains a very small sample and more analysis of data over a longer period might be helpful to better understand how/whether changes in mean MPRE scores inform meaningfully changes in mean MBE scores the following year.  At this point, I think the predictive value seems marginal given the wide range of changes on a year-over-year basis.

Item Three – Mean LSAT Scores

In the December article, Moeser further stated:

Specifically, I looked at what happened to the overall mean LSAT score as reported by the Law School Admission Council for the first-year matricu­lants between 2010 (the class of 2013) and 2011 (the class of 2014). The reported mean dropped a modest amount for those completing the first year (from 157.7 to 157.4). What is unknown is the extent to which the effect of a change to reporting LSAT scores (from the average of all scores to the highest score earned) has offset what would otherwise have been a greater drop. (LSAC Research Reports indicate that roughly 30% of LSAT takers are repeaters and that this num­ber has increased in recent years.

This assertion is misguided for purposes of this comparison, a point Vikram Amar made in his post.  If we were comparing the first-year matriculants in 2009 with the first-year matriculants in 2010, the question of the change in reporting from average LSAT score to highest LSAT score would have mattered.  But the 2010 matriculants were the first class for which the mean was reported based on highest LSAT score and the 2011 matriculants were the second class for which the mean was reported based on highest LSAT score.  Thus, there is no “unknown” here.  The reported mean LSAT dropped only a modest amount between the matriculants in 2010 and the matriculants in 2011.  Nonetheless, the mean MBE scaled score in July 2014 decreased by an historic 2.8 points from the mean MBE scaled score in July 2013. 

Item Four – Administration Issues

In her letter to Dean Kathryn Rand, Moeser stated:  "To the extent that the statement you attached referenced both administration and scoring of the July 2014, bar examination, note that NCBE does not administer the exam; jurisdictions do."

This response suggests not only that the NCBE is not responsible for administering the bar examinations in the many different jurisdictions, but implicitly suggests that issues with administration could not have contributed to the historic decline in the mean MBE scaled score. 

Were there issues with administration?  Yes.   Could they have contributed to the historic decline in the mean MBE scaled score?  Yes.

Debby Merritt’s recent posts discuss the administration issues and the potential consequences of the administration issues in some detail.  In over forty states that used ExamSoft to administer the bar examination, the MBE came on Wednesday, after the essay portion of the exam on Tuesday.  But because of an ExamSoft technical problem, tens of thousands of test-takers, who were initially informed by their respective state board of bar examiners that they would FAIL THE EXAM if their essay answers were not uploaded in a timely manner, spent most of Tuesday night dealing with the profound stress of not being able to upload their exam answers and not being able to contact anyone at the board of bar examiners (who were not answering phones) or at ExamSoft (due to the flood of calls and emails from anxious, frustrated, stressed out exam takers) to figure out what was going on and what they should do. 

Given that this “administration” issue caused untold stress and anxiety for thousands of test-takers, who spent Tuesday night completely anxious and stressed out trying repeatedly and unsuccessfully to upload their essay answers, should it be a surprise that they might have underperformed somewhat on the MBE on Wednesday?  (If you want a sense of the stress and anxiety, check the twitter feed for the evening of Tuesday, July 29, 2014)

The responses from the boards of bar examiners to this issue with administration of the bar examination were far from uniform.  Different jurisdictions granted extensions at different times of the night on Tuesday, July 29, or on Wednesday, July 30, with some granting short extensions and some granting longer extensions.  Thus, in states that gave notice of an extension out earlier on Tuesday, July 29, test-takers may have had less stress and anxiety, while in those states that didn’t give notice of an extension out until later (or for which the extension was relatively short), or where there may not have been any communication regarding extensions of the submission deadline, test takers likely experienced more stress and anxiety.  (It would be worth studying exactly when each jurisdiction gave notice of an extension and whether there is any correlation between timing of notice of the extension and the relative performance of bar takers in those states.)

The NCBE’s unwillingness to acknowledge any issues with administration of the bar examination is all the more surprising at a time when the NCBE is pushing for adoption of the Uniform Bar Examination.  On its webpage, the NCBE states: “[The UBE] is uniformly administered, graded, and scored by user jurisdictions and results in a portable score that can be transferred to other UBE jurisdictions.” (Emphasis added.)  This simply was not true in July 2014.  The Uniform Bar Examination was administered under different exam conditions across jurisdictions.  First, three of the states administering the Uniform Bar Examination in July 2014 did not use ExamSoft – Arizona, Nebraska and Wyoming -- and therefore, bar takers in those states had a vastly different “exam administration” experience than bar takers in ExamSoft jurisdictions.  Across ExamSoft jurisdictions, different approaches to extensions also meant different administration experiences. Given the significance of consistent administration for the purpose of equating performance on a standardized exam like the bar exam, that the NCBE allows such varied approaches to administering a supposedly “uniform” exam strikes me as very problematic.

Many questions remain unanswered, largely because adequate information has not been made available on which to assess the various factors that might have contributed to the historic decline in the mean MBE scaled score.  With the release of February bar results and the NCBE’s publication of the 2014 statistical report, some additional information is now available to put the results of July 2014 in context.  In my next blog posting regarding the July 2014 bar results, I will delve into some of those statistics to see what they tell us.

(Edited as of May 20 to correct the 2013 MPRE and 2014 MBE change and corresponding discussion.)

May 14, 2015 in Current events, Data on legal education, Data on the profession | Permalink | Comments (0)

Wednesday, May 13, 2015

Andy Perlman Appointed Dean of Suffolk Law

A friend and colleague!  Here's the press release.  

May 13, 2015 | Permalink | Comments (0)

Tuesday, May 12, 2015

Reply to Reply to Lipshaw on Private Law

10315tJohn Goldberg (left) and Henry Smith (right) at the new and interesting New Private Law blog flattered me with a serious and thoughtful response to my earlier post. (This is a version of a comment I posted over there.)

The gist of the response is that I was overstating things dramatically.  That is, there is a meaningful distinction between public and private law when it comes to contract law. 10822t

To be clear, I was not suggesting that inclusion of contract law in the “private” category was meaningless. Indeed, I said it was likely a helpful heuristic for the stuff that interests you all. And the distinction between public and private is almost certainly well understood conventionally at the extremes – e.g., law created wholly between two private parties (by way of contract) is private, and law created between two states (a treaty) is public. The pushback from Matt Bodie, Steve Bainbridge and others was with respect to the close cases.

I agree my headline was (over)dramatic. It had the intended effect! But I was making two moderately serious points that were not nearly as dramatic as I think John and Henry characterized.

First, the definition game IS a lawyer’s game. I suppose if there were a statute passed that said “All law professors concentrating on public law shall be paid salary two times that of one concentrating on private law, ceteris paribus,” I’d be in the middle of the fray arguing about what is in and out of the basket. But I’m not sure what the distinction actually cashes out. My lingering concern is that the definition game in academia pretty easily turns into the discipline game (i.e. what’s in a discipline and what is not), and that’s a subject on which I’ve written extensively – and with a normative spin: lawyers (particularly business lawyers) need to be careful about getting locked into disciplinary tunnel vision.

Second, though we can discuss the impact of writing down an agreement on one’s moral compunction to abide by its terms, I have argued (see the Canadian Journal of Law & Jurisprudence essay on objectivity and subjectivity in contract law) that indeed our voluntary interpersonal (I-You) commitments are essentially moral, and that we objectify them precisely for the purpose of making them publicly resolvable. It tends to be an article of faith that contracts actually inhibit opportunism when it comes down to cases (as opposed to the high theory of the New Institutional Economics), and hence constitute “law” between the parties. I disagree, but spelling all that out would take more than blog posts and comments.

Having said all that, I wish the New Private Law blog success and long life! It’s now on my RSS feed.

May 12, 2015 | Permalink | Comments (0)

Thursday, May 7, 2015

Revisiting Conditional Scholarships

Having been one of the people who brought attention to the issue of conditional scholarships a few years ago, I feel compelled to offer a few insights on a rekindled conversation about conditional scholarships involving Jeremy Telman and Michael Simkovic and Debby Merritt.

I am not sure what prompted Prof. Telman to write about conditional scholarships, but the first sentence of his initial post seems to be a few years late: 

One of the ways in which law schools are allegedly inadequately transparent is in the award of merit scholarships conditional on the students’ achievement of a certain grade point average. (Emphasis added)

A few years ago, one accurately could have said that law schools were inadequately transparent regarding the awarding and retention of conditional scholarships.  I did say that in an article Prof. Telman describes as “interesting.” 

Today, this is no longer accurate, because we have much greater transparency regarding conditional scholarships given the disclosures mandated pursuant to Standard 509.

Thus, I am not sure anyone is alleging that law schools are inadequately transparent regarding conditional scholarships and I am not sure why this is once again an item for discussion.  It has been well settled and law schools and prospective law students have adjusted to a new reality.  Indeed, in his follow up posting, Prof. Telman essentially acknowledges this point:

It seems we are all agreed that the disclosure problems related to conditional scholarships have largely been addressed through the ABA website that enables students to comparison shop among scholarship offers from various schools and know their chances of retaining their conditional scholarships.

That said, given that Prof. Telman got the conversation started, I have a response to one of his assertions and some observations to share.

The general context of his posting (and Prof. Simkovic’s related posts) is that college students have lived with conditional scholarships without apparent problems so conditional scholarships shouldn’t present a concern for law students.  In making his case, Prof. Telman relies on my 2011 article to support a proposition that the article actually disproves in some detail.  Specifically, Prof. Telman states:

Professor Organ was able to find information about how scholarships work at 160 law schools.  That means that the information was out there.  Since Professor Organ was able to gather information about 160 law schools, it should not be difficult for students to gather relevant information about the one law school that they are considering attending. 

He further states:  “Why are law students assumed to be incapable of looking into standard grade normalizations curves for the first year?”  Prof. Telman seems to be suggesting that there actually weren’t any disclosure problems because “the information was out there.”  The information was not out there. 

To be more precise, in putting together the article, with the efforts of research assistants as well as my own sleuthing, I was able to find sufficient information from the NAPLA-SAPLA Book of Lists, the ABA-LSAC Guide, and law school web pages from which to classify 160 law schools regarding whether the law school had a competitive scholarship program or some other type of scholarship program.  If Prof. Telman would have looked carefully at the article, however, he would have noted that “only four of these 160 schools had any information posted on their webpages indicating renewal rates on scholarships.”  (A point Derek Tokarz makes in the comments to Prof. Telman’s post.)

Prospective law students not only need relevant information about one law school, they need relevant and comparable information about the set of three or five or seven law schools they are considering seriously.  Prior to the Standard 509 mandated disclosure of conditional scholarship information, it was profoundly difficult if not impossible for students to gather relevant information from a few or several law schools.  The information simply was not “out there.”

Indeed, two of the primary points of my article were to highlight the information asymmetry between law schools and prospective law students relating to competitive scholarships and to recommend greater disclosure of the number of students receiving competitive scholarships and the number who had them renewed (or had them reduced or eliminated).   

Prof. Merritt discusses in some depth this information asymmetry, noting particularly that college students who have been successful in retaining their conditional scholarships as undergrads do not appreciate the reality of the mandatory curve they will encounter in law school, a point Stephen Lubet also makes cogently in a comment to Prof. Telman’s post. (Indeed, to his credit, Prof. Telman acknowledges that prospective law students also may suffer from optimism bias in assessing their likelihood of retaining their scholarship.)

Regarding the need for greater disclosure, regardless of how savvy and sophisticated we would like to believe prospective law students might have been or might be, the nuances of conditional scholarships and mandatory curves were not things that were clearly understood in the era prior to the mandatory Standard 509 disclosure.  I noted in my article that many students posting on Law School Numbers valued their scholarships based on a three-year total, regardless of whether they were conditional scholarships, suggesting these students failed to appreciate that the “value” should be discounted by the risk of non-renewal.  I also spoke with pre-law advisors around the country regarding conditional scholarship and consistently was told that this information was very helpful because pre-law students (and sometimes pre-law advisors) had not appreciated the realities of conditional scholarships.

While there are other things mentioned by Prof. Telman, Prof. Simkovic and Prof. Merritt to which I could respond, this post is already long enough and I am not interested in a prolonged exchange, particularly given that many of the points to which I would respond would require a much more detailed discussion and more nuance than blog postings sometimes facilitate.  My 2011 article describes my views on competitive scholarship programs and their impact on law school culture well enough.  Accordingly, let me end with one additional set of observations about what has happened with conditional scholarships in an era of increased transparency.

In my follow up article available on SSRN, I analyzed the frequency of conditional scholarships generally and the extent to which conditional scholarships were utilized by law schools in different rankings tiers for the 2011-2012 academic year (the first year following the ABA's mandated disclosure of conditional scholarship retention rates). 

For the entering class in the fall of 2011, I noted that there were 140 law schools with conditional scholarship programs, and 54 law schools with scholarship renewal based only on good academic standing, one-year scholarships, or only need-based scholarship assistance.  I also noted that conditional scholarship programs were much less common among top-50 law schools than among bottom-100 law schools. 

Based on the data reported in fall of 2014 compiled by the ABA for the entering class in the fall of 2013 (the 2013-2014 academic year), the percentage of all entering first-year students with conditional scholarships has increased slightly (from 26.1% in fall 2011 to 29% in fall 2013), while the percentage of all entering first-year students who had their scholarships reduced or eliminated has decreased slightly (from 9% as of summer of 2012 to 8.4% as of summer of 2014).  The average renewal rate across law schools increased from 68.5% to 73%.

More significantly, however, the number of law schools with conditional scholarship programs has declined, while the number with other types of scholarship programs has increased fairly significantly.  By 2013-2014, there were 78 law schools with scholarships renewed based on good academic standing, with one-year scholarships or with only need-based scholarship assistance, a significant growth in just two years in the number of law schools going away from conditional scholarship programs -- 24 more law schools, a 40% increase.  This would seem to indicate that at least some law schools have decided conditional scholarships aren’t as good for law schools or for law students. 

May 7, 2015 in Data on legal education, Scholarship on legal education | Permalink | Comments (1)

"Private Law" is an Oxymoron

John Goldberg and Henry Smith at Harvard have geared up a new blog dedicated to private law, in the process generating questions from Matt Bodie and Steve Bainbridge, among others, about the definition of private law.

UnknownI need to be careful here because I am close to invoking the W word (Austin Sarat told me once it was a Woody Allen like moment when I just happened to pull "Philosophical Investigations" out of my briefcase at a conference, so I'm going simply to post a picture.)

First, I'm a definition skeptic. Creating definitional baskets and stuffing things in them is a professional and parlor game for lawyers (e.g., is something a sport or a game?).  The question is whether the language in which definitions are cast sufficiently cuts reality at the joints to be helpful in any situation where we really don't have to decide if it's in or out.  The law, of course, is full of in-or-out situations.  Is it a security or isn't it?  Is she a resident of Massachusetts or isn't she? But is it helpful here other than a heuristic (and probably a useful one) for the stuff that interests the bloggers?  What counts as private law more likely bears significant family resemblances to public law than is something capable of crisp distinction.

Second, and more significantly, I think "private law" is an oxymoron when you actually parse it, as opposed to using it as a quick-and-dirty category. The guy I pictured above is famous for, among other things, observing that there are no private languages.  What that means is that for us to communicate at all, we are incorporating an objective world into our own subjective thoughts.  In the area of "private law" I think about the most, it's a lawyer's conceit to believe that the contract IS the deal, except in the simplest of circumstances.  As I've written in the past, the essence of turning an inter-personal relationship into a contract is to objectify it; once you've done that, and turned either to a community standard or a third party to interpret your agreement, it isn't private anymore.

May 7, 2015 | Permalink | Comments (0)

Thursday, April 30, 2015

A Short Screed About the Obligatory "I Can Raise Money" Portion of the Academic Leadership Candidate's Pitch

The screed is about the naive view of development you get from time to time during the search for leaders of educational institutions:  "He'd be great with alums."  "She can really work a room." "He's really connected to the movers and shakers." 

Clipart-money-royalty-free-vector-clip-art-of-a-happy-retro-man-jumping-up-and-down-over-a-large-sack-of-coins-with-a-money-symbol-black-and-white-by-bestvector-1934Sorry. Sophisticated development is not about the ability to be charming or to work a room or to have access to wealthy people, although all those are nice, ceteris paribus.  Perhaps you can get lucky and find the donor who's just itching to give a $25 million naming gift to the Southern Euphoria University College of Law, but that's not generally how it works.  It's a long game, and more than anything you can't raise money for a sow's ear without at the same time demonstrating that, indeed, you are turning it into a silk purse.  The two are inextricably linked.

Jack Welch said famously that GE's businesses were going to be number one or number two in their field, or GE would get out.  The rationale for that isn't some Neutron Jack inhumanity.  It's that he understood business is fund-raising.  It's either raising funds in the form of sales revenue because you have goods and services you are proud to sell, or it's raising funds in the form of capital from investors because you have businesses you are proud to say have a future.  Being number one or number two is a quick and dirty heuristic - and a quotable line - for being a silk purse and not a sow's ear.  (I'll bet GE kept some very good businesses that were number three!)

There's a similar dichotomy between sales and marketing.  Sales is knocking on the door; marketing is the sophisticated process of having something to sell and persuading people they want it.  Marketing is about a value proposition: put your money here rather than somewhere else because we will deliver to you more utils than the competition.  Compelling value propositions take work and require huge amounts of effort within the four walls of the institution before you put them out to customers and investors.  The same is true of schools.

Beware the naive view of development.  Beware the pitch that is just about willingness to knock on doors without linking it back to the hard work of building a distinct institution. Beware the person who thinks there's a meaningful distinction between being an "inside dean" and an "outside dean."

End of screed.

April 30, 2015 | Permalink | Comments (0)

Monday, April 13, 2015

PROJECTIONS FOR LAW SCHOOL ENROLLMENT FOR FALL 2015

          This blog posting is designed to do three things.  First, following up on recent discussions regarding trends in applicants by Al Brophy at The Faculty Lounge and Derek Muller at Excess of Democracy, I provide a detailed analysis to project the likely total applicant pool we can expect at the end of the cycle based on trends from March through the end of the cycle in 2013 and 2014.  Second, using the likely total pool of applicants, I estimate the number of admitted students and matriculants, but also question whether the estimates might be too high given the decline in quality of the applicant pool in this cycle.  Third, building on the second point, I suggest that law schools in the lower half of the top tier are likely to see unusual enrollment/profile pressure that may then have a ripple effect down through the rankings.

1. ESTIMATES OF THE TOTAL NUMBER OF APPLICANTS

Reviewing the 2013 and 2014 Cycles to Inform the 2015 Cycle

2013   Current Volume Summary Date

Applicants

%   of Cycle

Projected   Total Applicant Pool

Jan.   25, 2013

30,098

56%

53,750

Mar.   8, 2013

46,587

84%

55,460

May   17, 2013

55,764

95%

58,700

End   of Cycle

 

 

59,400

 

2014   Current Volume Summary Date

Applicants

%   of Cycle

Projected   Total Applicant Pool

Jan.   31, 2014

29,638

58%

51,110

Mar.   7, 2014

42,068

79%

53,250

April   25, 2014

48,698

89%

54,720

End   of Cycle

 

 

55,700

 

2015   Current Volume Summary Date

Applicants

%   of Cycle

Projected   Total Applicant Pool

Jan.   30, 2015

26,702

54%

49,450

Mar.   6, 2015

39,646

76%

52,160

April   3, 2015

45,978

87%

52,848

End   of Cycle

 

 

54,000   (Estimate)

        In each of the last two years, a modest surge in late applicants meant the final count exceeded the March/April projections by a couple thousand.  That would suggest that the current projection (for just under 53,000) likely understates the end of cycle applicant pool, which I am now estimating conservatively at 54,000 (down about 3% from 2014).  (In 2014, the amount by which the final pool total exceeded the early March projection was nearly 2,500.  With an estimated pool of 54,000 applicants, I am estimating that the final pool in 2015 will exceed the early March projection by roughly 2,000.)  (That said, if the employment results for 2014 graduates, which will be released shortly, show modest improvement over 2013, I anticipate that even more people might come off the fence and perhaps apply late for the fall 2015 class.)

2. ESTIMATES FOR ADMITTED APPLICANTS AND MATRICULANTS  

        The chart below shows the number of applicants, admitted students and matriculants over the last three years along with an estimate for fall 2015 based on the assumption above that we have a total of 54,000 applicants this cycle.  With 1,700 fewer applicants, I am assuming 1,000 fewer admitted students (a slight increase in the percentage admitted from 2014), and then assuming the number of matriculants will reflect the three-year average for the percentage of admitted students who matriculate – 87%.  This would yield a first-year entering class of 36,975, down about 2.5% from 2014.   

Estimates of Admitted Students and Matriculants for 2015 Based on Trends in 2012-2014

 

Applicants

Admitted   Students

Percent   of Applicants

Matriculants

Percent  of Admitted

2012

67,900

50,600

74.5%

44,481

87.9%

2013

59,400

45,700

76.9%

39,675

86.8%

2014

55,700

43,500

78.1%

37,924

87.2%

2015   (est.)

54,000

42,500

78.7%

36,975

87%

Why These Estimates for Admitted Students and Matriculants Might be Too High

        a.      Significant Decline in Applicants with LSATs of 165+

        Because of changes in the nature of the applicant pool in 2015, however, the estimates of the number of admitted students and number of matriculants in the chart above may be too high.  In 2014, almost all of the decrease in applicants came among those with LSATs of <165.  The pool of applicants with LSATs of 165+ in 2014 was only slightly smaller than in 2013 (7,477 compared with 7,496). Indeed, as a percentage of the applicant pool, those with LSATs of 165+ increased from 12.6% in 2013 to 13.4% in 2014.  This resulted in a slight increase in the number of matriculants with LSATs of 165+ in 2014 compared to 2013 (6,189 compared with 6,154).

        In the current cycle, however, the number of applicants with LSATs of 165+ was only 6,320 as of March 6, 2015. In 2013, there were 7,228 on March 8, 2013 (of a final total of 7,496).  In 2014, there were 7,150 on March 7 (of a final total of 7,477).  Thus, the average increase in applicants with LSATs of 165+ between early March and the end of the cycle is only about 4%.  That would suggest that we could anticipate having roughly 6,585 applicants with LSATs of 165+ at the end of the cycle – down nearly 900 from 2014 – over 12%.

Estimate of Number of Total Applicants for 2015 with LSATs of 165+ Based on Trends in 2013 and 2014

 

Applicants at 165+

 

Applicants at 165+

# Increase to end of Cycle

% Increase to end of Cycle

March 8, 2013

7228

End of Cycle 2013

7496

268

3.7%

March 7, 2014

7150

End of Cycle 2014

7477

327

4.6%

March 6, 2015

6320

End of Cycle 2015 (est.)

6585

265

4.2%

        On a longer term basis, if the estimates in the preceding paragraphs are accurate, the entering class in fall of 2015 will again extend the slide in the number and percentage of first-year students with LSATs of 165+ that has been underway since the class that entered in fall of 2010.

Five-Year Trend in Applicants and Matriculants with LSATs of 165+  and Estimates for 2015

 

Applicants with LSATs of 165+

Matriculants   with LSATs of 165+

Percent   of Applicants Matriculating

2010

12,177

9,477  

77.8%

2011

11,190

8,952  

80%

2012

9,196

7,571  

82.3%

2013

7,496

6,154  

82.1%

2014

7,477

6,189

82.8%

2015 (est.)

6,585

5,420

82.4%

        Given that on average over the last three years roughly 82.4% of admitted students with LSATs of 165+ actually matriculated, one could expect that the 6,585 applicants would translate into 5,420 matriculants with LSATs of 165+ for fall 2015, a decline of nearly 770 from 2014.  Notably, this would represent a 45.9% drop in applicants with LSATs of 165+ since 2010 and a 42.8% drop in matriculants with LSATs of 165+ since 2010.

        b. Modest Decrease Among Applicants with LSATs <150

        On the other end of the LSAT distribution, it is a completely different story. Although the number of applicants with LSATs <150 also has declined, the decline has been more modest than among those with LSATs of 165+.  Moreover, those with LSATs of <150 are much more likely to apply late in the cycle.  In the last two years there has been significant growth among applicants with LSATs of <150 between early March and the end of the cycle.   As a result, I would estimate that we would have 18,350 applicants with LSATs of <150 by the end of this cycle, a decline of only about 4.5%.

Estimate of Number of Total Applicants for 2015 with LSATs of <150 Based on Trends in 2013 and 2014

 

Applicants with LSATs of <150

 

Applicants with LSATs of <150

# Increase

% Increase

March 8, 2013

13,364

End of Cycle 2013

20,706

6,642

49.7%

March 7, 2014

11,662

End of Cycle 2014

19,239

7,577

65%

March 6, 2015

11,467

End of Cycle 2015 (est.)

18,350

6,880

60%

        With applicants with LSATs <150 making up a larger percentage of the declining applicant pool, the number of matriculants with LSATs of <150 actually had grown each year up until 2014, when the slight increase in matriculants with LSATs of 165+ was mirrored by a slight decrease in matriculants with LSATs <150. 

Five-Year Trend in Applicants and Matriculants with LSATs of <150 and Estimates for 2015

 

Applicants   with LSATs of <150

Matriculants   with LSATs of <150

Percent   of Applicants Matriculating

2010

26,548

7,013

26.4%

2011

24,192

7,101

29.4%

2012

22,089

7,906

35.8%

2013

20,706

8,482

41%

2014

19,239

8,361

43.5%

2015 (est.)

18,350

8,700

47.4%

        Given that the percentage of applicants with LSATs <150 matriculating has increased each of the last five years, it seems reasonable to expect another increase – to 47.4% -- resulting in roughly 8,700 matriculants with LSATs of <150, particularly given the decrease in the number of applicants with LSATs of 165+.  Even so, it seems unlikely to make up for the drop of nearly 770 matriculants among those with LSATs of 165+.  Notably, while the pool of applicants with LSATs <150 has decreased by of 30.9% since 2010, the number of matriculants has increased by 24.2%.

        Thus, while the smaller decline in applicants that is expected this year might suggest a correspondingly smaller decline in matriculants, with the weaker profile of the applicant pool in 2015 compared to 2014, it is quite possible that the total number of admitted students will be lower than the chart above suggests and that the corresponding number of matriculants also will be lower than the chart above suggests.

        Phrased differently, if there really is going to be a decline of roughly 770 matriculants just in the group with LSATs of 165+, then the total decline in matriculants may well be greater than the 950 estimated in the chart above.  Between 2013 and 2014, a decline in applicants of 3,700, almost all with LSATs of 164 and below, resulted in a decline in matriculants of 1,750, all with LSATs of 164 and below.  If the decline in applicants is 1,700 this cycle, with over half the decline among those with LSATs of 165+, with a decline of perhaps several hundred with LSATs between 150-164, and with a modest decrease (or possibly a slight increase) among those with LSATs <150, we may well see that the decline in admitted students and in matriculants is slightly larger than estimated in the chart above.

3. PROFILE CHALLENGES AMONG ELITE SCHOOLS

        One interesting side note is that the significant decrease in the number of applicants with LSATs of 165+ is likely to put significant pressure on a number of top-50 law schools as they try to hold their enrollment and their LSAT profiles.  Simply put, there are not enough applicants with LSATs of 165+ to allow all the law schools in the top-50 or so to maintain their profiles and their enrollment. 

        If the estimates above are correct – that there will be roughly 5420 matriculants with LSATs of 165+– and if we assume that at least a few hundred of these matriculants are going to be going to law schools ranked 50 or below either due to geography or scholarships or both – and if we assume that the top 15 law schools are likely to leverage rankings prestige (and perhaps scholarships) to hold enrollment and profile -- then the decrease of roughly 770 matriculants with LSATs of 165+ is going to be felt mostly among the law schools ranked 16-50 or so. 

        In 2014, the top 15 law schools probably had roughly 3,800 first-year matriculants with LSATs of 165+.  The schools ranked 16-50 likely had another 1,900 or so.  The remaining 500 plus matriculants with LSATs of 165 and above likely were scattered among other law schools lower in the rankings. Let’s assume the top-15 law schools manage to keep roughly 3,700 of the 3,800 they had in 2014.  Let’s assume law schools ranked 50 and below keep roughly 500 or so.  That means the law schools ranked between 16 and 50 have to get by with 1,220 matriculants with LSATs of 165+ rather than 1,900 last year.  While many schools will be dealing with the challenges of maintaining enrollment (and revenue) while trying to hold profile, this likely will be a particularly challenging year for law schools ranked between 16 and 50 that are trying to navigate concerns about enrollment (and revenue) with concerns about profile.  To the extent that those schools look toward applicants with lower LSAT profiles to maintain enrollment, that will then have a ripple effect through the law schools lower in the rankings.

April 13, 2015 in Data on legal education, Scholarship on legal education | Permalink | Comments (0)

Sunday, April 12, 2015

Another Example of Using Big Data to Improve Odds of Winning in Court

Back in February, I wrote a post on The The Early Days of Legal Analytics.  It discussed some of the innovations at Lex Machina, a legal start-up that uses Big Data to value contested patents and develop a litigation strategy designed to maximize value / minimize risk.  I recently came across another company, Premonition, that claims to use artificial intelligence to select lawyers with the best odds of achieving a favorable result. See Premonition Infographic at bottom of this post.

I spend a lot of time on the road talking to law firm lawyers and legal innovators, including legal start-ups.  Many large firm lawyers tend to dismiss new innovations without stopping to listen to, much less gather, relevant facts.  Likewise, there is a lot of puffery among legal start-ups as they try to land their first few customers.  Thus, I tend to apply a windage factor to accurately interpret what I am being told.

The image below contains Premonition's simple, one-sentence pitch.  I don't know about the product, but the concept is pretty clear.

Premonition

The core benefit Premonition appears to offer is a list of lawyers with winning track records in front of specific judges. We don't need artificial intelligence (AI) to make that calculation.  A win-rate is a simple descriptive statistic, even if it has been filtered for a variety of matching criteria.

That said, AI could come in handy in building the requisite data sets.  As explained on Premonition's website, courts don't construct their case management systems so they can be vacuumed out by data mining companies. Indeed, local court officials would likely to be hostile to such requests because any resulting statistical model is unlikely to make them look good.  Indeed, the purpose of the model is, at least in part, to identify and exploit imperfections in the judicial process.  

Because the courts have no incentive to make life easy for Big Data vendors, Premonition's Chief Innovation Officer, Toby Unwin, claims to have tackled the data assembly problem by building a technology that scrapes and buckets the necessary data from the jumbled chaos of web portals for state and local courts.  Such a task, in theory, can be performed by fairly standard machine learning, which qualifies as AI, at least in some circles.  

Assuming Premonition has built a machine that can calculate win-rate of lawyers, is that information valuable to clients trying to maximize the likelihood of a favorable result?  I don't know, but its plausible enough to test with data.

Some data skeptics will argue that win-rates, whether high or low, are just artifacts of any normally distributed outcome.  The reasoning runs, "Two, three, and four sigma events occur in the ordinary course of life, but regression to the mean is pulling them back to the center. Thus, they are poor predictors of the future."  This reasoning is why many people buy indexed funds rather than shares in actively managed mutual funds.  Cutting the other way, the hedge fund industry is premised on the belief that some money managers are a lot better than others. Five-year return rates are aggregated and published in the industry trade press.  Some of the returns may be due to random luck, but some could be attributed to superior skill.  It is absurdly unlikely, for example, that Warren Buffet's success in buying and selling stocks is just a 60-year lucky streak.

In the case of win-rates in court, I can think of at least two plausible non-random factors that could affect outcomes:

  1. Judicial bias or favoritism.  Judges, either consciously or unconsciously, may react differently to the case depending upon the advocate.  One does not have to wade too far into the political science literature to find peer-reviewed empirical studies that reveal that judges are influenced by more than just facts and law. 
  2. The gap between credentials and bona fide skill.  Law has historically been a credence good.  This means the market relies on elite credentials and firm reputation as a proxy for skill.  Yet, it is plausible that some lawyers may lack the pedigree to get hired by large, elite law firms, yet they go on to develop outstanding legal skills, perhaps because of superior drive, intellectual curiosity, or "early at-bats" as a prosecutor or public defender. If these folks exist, Big Data can likely find them.

I can't vouch for Premontion's technology beyond two statements: (1) it sounds plausible, and (2) it is a waste of time to debate its usefulness because it's an empirical question that the market will answer in the relatively near term.  

Below is one of Premonition's infographics.

Infographic-Everything-You-Know-About-Lawyer-Selection-Is-Wrong

 

April 12, 2015 in Cross industry comparisons, Current events, Innovations in law, New and Noteworthy | Permalink | Comments (1)

Wednesday, March 18, 2015

Igniting Law Teaching Conference

IgnitingLawTeaching
Registration is now open for LegalED’s Igniting Law Teaching 2015.  The conference is Friday, March 20, 2015 from 9:00 am – 5:00 pm EST at American University Washington College of Law.  It is also available for live viewing by webcast.

The conference will feature talks by 30 law school academics and practitioners from the US, Canada and England in a TEDx-styled conference to share ideas on teaching methodologies.  LegalED’s Teaching Pedagogy video collection includes many of the talks from last year’s conference, which have been viewed collectively more than 5000 times.  The panels for this year include:

  • Law Teaching for the 21st Century
  • Applying Learning Theory to Legal Education
  • The Art and Craft of Law Teaching
  • Using Technological Tools for Legal Education, and Pathways to Practice. 

Here is a link to the topics, speakers and schedule.

 The Igniting Law Teaching conference is unlike other gatherings of law professors.  Here, talks will be styled as TEDx Talks, with each speaker on stage alone, giving a well scripted and performed 8 minute talk about an aspect of law school pedagogy.  In the end, we will create a collection of short videos on law school-related pedagogy that will inspire innovation and experimentation by law professors around the country, and the world, to bring more active learning and practical skills training into the law school curriculum.  The videos will be available for viewing by the larger academic community on LegalED, a website developed by a community of law professors interested in using online technologies to facilitate more active, problem-based learning in the classroom, in addition to better assessment and feedback.

 Readers are encouraged to attend the March 20th conference, either live or virtually

[HT: the tireless and thoughtful Michele Pistone of Villanova Law]

March 18, 2015 in Current events, Fun and Learning in the classroom | Permalink | Comments (0)

Saturday, February 7, 2015

The Early Days of Legal Analytics

LexMachina-logo1There is an interesting story in Forbes on Lex Machina, a legal start-up that provides analytics for use in patent litigation.  See Dan Fisher, Stanford-Bred Startup Uses Moneyball Stats to Handicap Judges, Forbes, Feb. 2, 2015.  The company was created by faculty at Stanford Computer Science and Stanford Law.  As the company emerged from the University, the reigns were handed to Josh Becker, a Stanford JD-MBA.  To date, the company has raised $8 million in start-up funding.  According to the Forbes article, the company's clients include some of the nation's large technology companies plus one-third of the AmLaw 100.

What makes Lex Machina so interesting is that the company is not a NewLaw service provider that trying to take marketshare. Instead, Lex Machina is a toolmaker.  It is a true Big Data company that provides analytics to (a) value contested patents and (b) protect/maximize that value through a litigation strategy that is informed by data.  

The impact of Lex Machina is hard to decipher, primarily because if it does provide an edge, the customers are unlikely to be too vocal. Just like a hedge fund with an effective trading strategy, why advertise the ingredients of your secret sauce? Indeed, compared to other toolmakers (e.g., predictive coding, expert systems) Lex Machina's benefits are less about efficiency and more about affecting the outcomes of cases -- who wins and by how much.  If Lex Machina is truly delivering, it will eventually touch-off a Big Data legal analytics arms race akin to the quant revolution on Wall Street.  Dan Katz frequently makes this point, and I think he is right.  The Forbes article makes the point that Lex Machina is already moving into adjacent areas of IP law and general commercial litigation.  

The broader legal industry is unlikely to notice Lex Machina until it has a substantial liquidity event -- i.e., it's acquired or goes public, making if founders far richer than the BigLaw partners and in-house lawyers they currently serve.  

If we are looking for early signs of a tipping point for legal analytics, one marker may be the number of Stanford Law grads who are turning down entry-level opportunities in BigLaw to pursue legal start-ups.  In recent years, Stanford Law grads fresh out of law school have gone on to found other venture-backed legal start-ups like Ravel Law, Judicata, and Law Gives.  Back in 2013, The Stanford Lawyer (SLS alumni magazine) had an extensive write-up with several examples.  See Sharon, Driscoll, A Positive Disruption, June 4, 2013.  In 2014, Stanford's CSO offered a program titled, An Alternative to BigLaw -- Startups.

The legal world isn't going away; it's just changing.

February 7, 2015 in Cross industry comparisons, Current events, Data on the profession, Innovations in law, New and Noteworthy, Structural change | Permalink | Comments (0)

Saturday, January 17, 2015

Stark on Curriculum Reform (and Law School Pre-reqs)

UnknownTina Stark, a pioneer in transactional skills education, has an interesting and highly readable take on how to organize a modern law school curriculum, including the first year.  It's all insightful, but I think the most powerful suggestion is the creation of three foundational modules - litigation, transactions, and legislation/regulation - in which the offerings would combine theory, doctrine, and skills.  

The piece is a transcript of her keynote address, "What Cornell Veterinary School Taught Me About Legal Education," at the Fourth Biennial Conference of Emory Law School's Center for Transactional Law and Education.

What stirred Tina's reflections was her son's matriculation from the classroom to the clinical portion of his veterinary education.  I posted similar thoughts some time ago reflecting on my son Matthew's (now Dr. Matthew Lipshaw, resident in pediatrics, Yale-New Haven Children's Hospital) med school experience.  I'm still persuaded that there are two things medical education has over legal education (I can't speak to veterinary): (a) the reimbursement system in health care provides resources for skills training not likely to be available any time soon for legal education, and (b) with all due respect to law students (and I know whereof I speak because I was one), even with a semester or a year in a clinical offering, med students work a hell of a lot harder than law students.  We'd have no problem getting both doctrinal and skills training into our students if they were at it six or seven days a week, twelve or thirteen hours a day.

If you download Tina's piece, there's a lagniappe at the end - some thoughts on why there's no law school pre-req for English composition, yet there is in med and engineering school!

 

January 17, 2015 | Permalink | Comments (2)

Tuesday, January 6, 2015

The Variable Affordability of Law School – How Geography and LSAT Profile Impact Tuition Costs

I have posted to SSRN the PowerPoint slides I presented yesterday at the AALS Conference session sponsored by the Section on Law School Administration and Finance.  The presentation was entitled The Variable Affordability of Law School – How Geography and LSAT Impact Tuition Cost.   (I am very grateful to my research assistant, Kate Jirik, and her husband, Sam, for awesome work on the spreadsheet that supported the data I presented.)

The presentation begins with two slides summarizing data presented in my article Reflections on the Decreasing Affordability of Legal Education showing the extent to which average public school and private school tuition increased between 1985 and 2011 relative to law school graduate income.  While many have observed that law school has become increasingly expensive over the last few decades, this "macro" discussion fails to highlight the extent to which differences in tuition exist at a “micro” level either based on geography or on LSAT score.

Using 2012 tuition data, the first set of slides focuses on geographic differences – noting some states where legal education generally is very expensive, some states where legal education generally is very affordable and the balance of states in which tuition costs are in the middle or have a mix of affordable and expensive. 

Following those slides, there is a set of slides that describe the process I used to calculate net tuition costs after accounting for scholarships for all entering first-year students at the 195 fully accredited and ranked law schools in fall 2012 in an effort to allocate all students into a five-by-five grid with five LSAT categories (165+, 160-164, 155-159, 150-154 and <150) and five cost categories ($0-$10,000, $10,000-$20,000, $20,000-$30,000, $30,000-$40,000, and $40,000+).  There then are a set of slides summarizing this data and trying to explain what we can learn from how students are allocated across the five-by-five grid, which includes a set of slides showing the average rank of the schools at which students in each LSAT/Cost category cell are enrolled.

The concluding slide sets forth a couple of short observations about the data. There was a robust discussion with some great questions following the presentation of this data.

Here are four of the slides to give you a flavor for the presentation on net cost generally and then net cost relative to LSAT categories -- Image1
Image1

 

Image1

 

Image1


Image1

January 6, 2015 in Data on legal education, Scholarship on legal education | Permalink | Comments (0)

Sunday, January 4, 2015

Size of the US Legal Market by Type of Client

Washington, DC.  The AALS Section on Professional Responsibility hosted a vigorous discussion today on the evolving ethical duty of competency, a topic partially inspired by the recent changes to Model Rule 1.1 cmt. 8 (requiring lawyers to stay abreast of the "benefits and risks associated with relevant technology").  As part of this panel, I showed a chart on the size of the US legal market, which was promptly tweeted by CALI 's Director of Community Development, Sarah Glassmeyer, a law librarian who is a total data subversive in a style and manner I fully support.

Well, despite a less-than-optimal photo angle, the chart was retweeted and favorited, so I figured I ought to just post the actual chart here. [Click on to enlarge] Legal Market

In a competitive market, the threshold question, asked by potential entrants and those who might finance them, is often the same: "what is the size of the available (or addressible) market?" Because lawyers and law schools are feeling unprecedented economic pressure, I thought it would be worthwhile to run this exercise for the U.S. legal industry and break it down by type of client.

The figures above are estimates of 2014 receipts going to organizations and individuals in the business of providing legal services.  My calculations are derived from US Census Bureau data. They exclude the cost of in-house and government lawyers.  More granular calculation details will be laid out in a forthcoming publication.

At today's AALS Professional Responsibility session, technology was framed as an ethical issue. And that is certainly right:  technology can deliver enormous cost and quality benefits to clients, so we have both a fiduciary and professional duty to be up-to-date.  Yet, there is a flip-side here that is crucially important -- to ignore or fall behind on technology is to run the risk of commercial ruin. This axiom applies to lawyers in private practice and to law schools that want employers to hire their graduates. 

Building upon that theme, I used the Market Size chart to make two points today, one based on the high-end corporate market (right side of chart) and the other directed toward the individual consumer market (left side of chart). 

Re the corporate side, the data show that a relatively small roster of large corporations are spending vast sums each year on legal services -- more than $10 million per year for a publicly held company.  Because large national and international corporations are awash in a sea of growing legal complexity, they are turning to technology, process, and data to keep legal costs in line with overall company revenues.  From the perspective of a large corporate client, the typical junior law firm associate has little to offer.  A more seasoned partner or counsel is a better value, but this is by virtue of experience rather than technology or process.  As a result, law firm hiring remains stagnant, and more legal work is being taken in-house or given to LPOs or New Law legal service providers like Axiom, Elevate, or Novus Law.  It may take a generation for the law school--law firm--legal department supply chain to come into a reasonable alignment.  Right now, it's broken.

Re the individual retail market, the $232 annual legal spend per citizen means that there is not enough money go around to pay for all the legal need.   If a middle-class professional couple with kids has a contested divorce, that could easily chew-up $50,000 to $100,000 in legal fees.  A DUI is likely to cost $1,500.  A worker's comp claim might be 30% of an award.  Probate work runs well into the thousands.  In reality, most citizens go without.  One of our co-panelists today, retired US Magistrate Judge John Facciola, made the claim that 83% of American never talk to a lawyer to help them with a legal problem.  "The middle class is largely gone from federal court."  To my mind, technology is the only vehicle for tapping into a large latent market for legal services.  LegalZoom, Rocket Lawyer, Modria, Shake, and many other legal technology companies all see the potential here. And so do the venture capital and private equity firms that are funding them. 

 Today's panel was one of the most lively I have ever attended at AALS, owing in part to my excellent co-panelists but also an audience that asked some great, tough questions.  Many thanks to Andy Perlman (Suffolk Law) for organizing a terrific session and Natasha Martin (Seattle) for her skillful moderation of the panel.

January 4, 2015 in Current events, Data on the profession, Legal Departments, New and Noteworthy, Structural change | Permalink | Comments (2)

Monday, December 29, 2014

The Composition of Graduating Classes of Law Students -- 2013-2016 -- Part One

PART ONE -- Analyzing the LSAT Profile/Composition of Entering First-Years from 2010 to 2013 and 2014

In the fall of 2013, I had a series of blog posting about the changing demographics of law students.  In the first, I noted that fewer students were coming to law school from elite colleges and universities.  In the second, I noted that between 2010 and 2013 there had been a decline in the number of matriculants with high LSATs and an increase in the number of matriculants with low LSATs such that the “composition” of the class that entered law school in the fall of 2013 was demonstrably less robust (in terms of LSAT profile) than the “composition” of the class that entered law school in the fall of 2010.  In describing this phenomenon, I noted that when the entering class in fall 2013 graduates in 2016, it might encounter greater problems with bar passage than previous classes. 

In light of the significant decline in the median MBE scaled score in July, which Derek Muller has discussed here and here, and which I have discussed here, and a significant decline in first-time bar passage rates in many jurisdictions this year, it seems like an appropriate time to look more closely at changing class profiles and the likely impact on bar passage in the next few years.

This is the first of two blog posts regarding the changing composition of entering classes and the changing composition of graduating classes.  In Part I, I analyze the distribution of LSAT scores across categories based on the LSAC’s National Decision Profiles for the years 2009-2010 through 2012-2013, and then analyze the distribution of law school median LSATs and the 25th percentile LSATs across ranges of LSAT scores.  In Part II, I will analyze how attrition trends have changed since 2010 to assess what that might tell us about the composition of graduating classes three years after entering law school as a way of thinking about the likely impact on bar passage over time.

Tracking Changes Based on National Decision Profiles – 2010-2013

The following discussion summarizes data in the LSAC’s National Decision Profiles from the 2009-10 admission cycle (fall 2010) through the 2012-13 admission cycle (fall 2013).  The National Decision Profile for the 2013-14 admission cycle (fall 2014) has not yet been released.

Let’s start with the big picture.  If you take the matriculants each year and break them into three LSAT categories – 160+, 150-159, and <150 – the following chart and graph show the changes in percentages of matriculants in each of these categories over the last four years. 

Percentage of Matriculants in LSAT Categories – 2010-2013

                        2010    2011    2012    2013

160+                40.8     39        36.3     33.4

150-159           45        45.3     44.3     44.1

<150                14.2     15.7     19.3     22.5

Image1
Notably, this chart and graph show almost no change in the “middle” category (150-159 -- purple) with most of the change at the top (160+ -- orange -- decreasing from 40.8% to 33.4%) and bottom (<150 -- blue -- increasing from 14.2% to 22.5%).  This chart and graph also show only a modest change between 2010 and 2011 with more significant changes in 2012 and again in 2013 – when the percentage of students with LSATs of 160+ declines more substantially and the percentage of students with LSATs of <150 grows more substantially.

While I think this tells the story pretty clearly, for those interested in more detail, the following charts provide a more granular analysis.

Changes in LSAT Distributions of Matriculants – 2010-2013       

                            2010    2011    2012    2013         Chg in Number     % Chg in Number       

170+                3635    3330    2788    2072                -1563               -43%   

165-169           5842    5622    4783    4082                -1760               -30%   

160-164           10666  8678    7281    6442                -4224               -39.6%

155-159           11570   10657  9700    8459                -3111                -26.9%

150-154           10626  9885    8444    8163                -2463               -23.2%

145-149           5131     5196    5334    5541                 410                  8%      

<145                1869    1888    2564    2930                1061    `           56.8% 

                        49339  45256  40894  37689 

Note that in terms of percentage change in the number of matriculants in each LSAT category, the five highest LSAT categories are all down at least 20%, with 160-164 down nearly 40% and 170+ down over 40%, while the two lowest LSAT categories are up, with <145 being up over 50%.

 

Image1
Note that in the line graph above, the top two categories have been combined into 165+ while the bottom two categories have been combined into <150.  Perhaps most significantly, in 2010, the <150 group, with 7,000 students, was over 2,400 students smaller than the next smallest category (165+ with 9.477) and more than 4,500 students smaller than the largest category (155-159 with 11,570).  By 2013, however, the <150 category had become the largest category, with 8,471, just surpassing the 155-159 category, with 8,459, and now 2,300 larger than the smallest category, 165+ with only 6,154.

Changes in Percentage of Matriculants in LSAT Ranges – 2010-2013

                        PERCENTAGE OF MATRICULANTS

                        2010    2011    2012    2013    % Chg in %    

>169                0.074   0.074   0.068   0.055   -25.7%

165-169           0.118   0.124   0.117    0.108   -8.5%  

160-164           0.216   0.192   0.178   0.171   -20.8%

155-159           0.235   0.235   0.237   0.224   -4.7%  

150-154           0.215   0.218   0.206   0.217   0.9%   

145-149           0.104   0.115    0.13     0.147   41.3% 

<145                0.038   0.042   0.063   0.078   105.3%                       

In terms of the “composition” of the class, the percentage of matriculants in each LSAT category, as noted above, little has changed in the “middle” – 155-159 and 150-154, but significant changes have occurred at the top and bottom, with declines of 20% or more at 160-164 and 170+ and with increases of 40% at 145-149 and over 100% at <145.

Tracking Changes in Law School Median LSATs by LSAT Category

A different way of looking at this involves LSAT profiles among law schools over this period.  Based on the data law schools reported in their Standard 509 Reports, from 2010 to 2014, the chart below lists the numbers of law schools reporting median LSATs within certain LSAT ranges.  (This chart excludes law schools in Puerto Rico and provisionally-approved law schools.)

Number of Law Schools with LSAT Medians in LSAT Categories – 2010-2014

 

2010

2011

2012

2013

2014

165+

30

31

26

23

21

160-164

47

41

39

31

29

155-159

59

57

56

53

51

150-154

50

52

53

56

59

145-149

9

14

22

28

29

<145

0

1

0

5

7

 

Image1

The chart above pretty clearly demonstrates the changes that have taken place since 2010, with declines in the number of law schools with median LSATs in higher LSAT categories and increases in the number of law schools with median LSATs in the lower LSAT categories.  The number of law schools with median LSATs of 160 or higher has declined from 77 to 50.  By contrast, the number of law schools with median LSATs of <150 has quadrupled, from 9 to 36.   Moreover, the “mode” in 2010 was in the 155-159 category, with nearly 60 law schools, but as of 2014, the “mode” had shifted to the 150-154 category with nearly 60 law schools.

Number of Law Schools with 25th Percentile LSAT in LSAT Categories – 2010-2014

 

2010

2011

2012

2013

2014

165+

17

16

11

10

10

160-164

26

20

21

17

15

155-159

55

54

49

42

41

150-154

67

69

59

65

57

145-149

26

33

46

48

48

<145

4

4

10

14

25

 

Image1

For those who want to focus on the bottom 25th percentile of LSAT profile among law schools, the chart above shows a similar trend when compared with the medians, except that the number of law schools with a 25th  percentile LSAT between 150-154 also declined (as opposed to an increase with respect to medians). The number of law schools with 25th percentile LSATs of 160 or higher has declined from 43 to 25.  Similarly, the number of law schools with 25th percentile LSATs of 150-159 has declined from 122 to 98.  By contrast, the number of law schools with 25th percentile LSATs of 145-149 has nearly doubled from 26 to 48, while the number of law schools with 25th percentile LSATs of <145 has sextupled from 4 to 25. 

One other way of looking at this is just to see how the average first-year LSAT profiles have changed over the last four years. 

Average LSATs of Matriculants at Fully-Accredited ABA Law Schools

            75th Percentile             Median            25th Percentile

2010                160.5               158.1               155.2

2011                160.1               157.8               154.5

2012                159.6               157                  153.6

2013                158.7               156                  152.6

2014                158.2               155.4               151.8

This shows that between 2010 and 2014, the average 75th percentile LSAT has declined by 2.3 points, the average median LSAT has declined by 2.7 points and that the average 25th percentile LSAT has declined by 3.4 points.

Conclusion

If one focuses on the LSAT score as one measure of “quality” of the entering class of law students each year, then the period from 2010-2014 not only has seen a significant decline in enrollment, it also has seen a significant decline in quality.  On an axis with high LSATs to the left and low LSATs to the right, the “composition” of the entering class of law students between 2010 and 2014 has shifted markedly to the right, as shown in the graph below.  Moreover, the shape of the curve has changed somewhat, thinning among high LSAT ranges and growing among low LSAT ranges.  

Image1

This shift in entering class composition suggests that bar passage rates are likely to continue to decline in the coming years.  But in terms of bar passage, the entering class profile is less meaningful than the graduating class profile.  In part two, I will look at attrition data from 2011 to 2014 to try to quantify the likely “composition” of the graduating classes from 2010 to 2013, which will give us a more refined idea of what to expect in terms of trends in bar passage in 2015 and 2016.

(I am grateful to Bernie Burk and Alice Noble-Allgire for helpful comments on earlier drafts.)

December 29, 2014 in Data on legal education, Structural change | Permalink | Comments (5)

Saturday, December 20, 2014

Further Understanding the Transfer Market -- A Look at the 2014 Transfer Data

This blog posting is designed to update my recent blog posting on transfers to incorporate some of the newly available data on the Summer 2014 transfer market.  Derek Muller also has written about some of the transfer data and I anticipate others will be doing so as well.

NUMBERS AND PERCENTAGES OF TRANSFERS – 2006-2008, 2011-2014

While the number of transfers dropped to 2187 in 2014 down from 2501 in 2013, the percentage of the previous fall’s entering class that engaged in the transfer market remained the same at roughly 5.5%, down slightly from 5.6% in 2013, but still above the percentages that prevailed from 2006-2008 and in 2011 and 2012.

 

2006

2007

2008

2011

2012

2013

2014

Number   of Transfers

2265

2324

2400

2427

2438

2501

2187

Previous   Year First Year Enrollment

48,100

48,900

49,100

52,500

48,700

44,500

39700

%   of Previous First-Year Total

4.7%

4.8%

4.9%

4.6%

5%

5.6%

5.5%

 

SOME SCHOOLS DOMINATE THE TRANSFER MARKET – 2012-2014

The following two charts list the top 20 transfer schools in Summer 2012 (fall 2011 entering class), Summer 2013 (fall 2012 entering class) and Summer 2014 (fall 2013 entering class) – with one chart based on “numbers” of transfers and the other chart based on the number of transfer students as a percentage of the prior year’s first year class.

Largest Law Schools by Number of Transfers from 2012-2014

School

Number   in 2012

School

Number   in 2013

School

Number   in 2014

Florida   State

89

Georgetown

122

Georgetown

113

Georgetown

85

George   Wash.

93

George Wash.

97

George   Wash.

63

Florida   St.

90

Arizona St.

66

Columbia

58

Emory

75

Idaho

57

Mich. State

54

Arizona   State

73

Cal. Berkeley

55

NYU

53

American

68

NYU

53

American

49

Texas

59

Emory

50

Cardozo

48

Columbia

52

Columbia

46

Loyola Marymount

46

NYU

47

American

44

Rutgers   - Camden

42

Minnesota

45

UCLA

44

Minnesota

42

Arizona

44

Wash. Univ.

44

Arizona   State

42

Northwestern

44

Texas

43

Cal. Berkeley

41

UCLA

41

Minnesota

37

Emory

41

Cardozo

38

Northwestern

35

UCLA

39

Southern   Cal.

37

Harvard

33

Northwestern

38

Utah

34

Mich. State

33

Florida

37

Harvard

34

Loyola Marymount

32

Maryland

34

Florida

33

Florida State

31

Michigan

33

Cal. Berkeley

32

Southern   Cal.

30

SMU

31

Wash Univ.

31

Miami

29

Harvard

31

 

 

 

 

 

Largest Law Schools by Transfers as Percentage of Previous First-Year Class

2012-2014 

School

% 2012

School

% 2013

School

% 2014

 

Florida St.

44.5

Florida State

48.1

Arizona State

51.6

Arizona State

24.6

Arizona State

48

Idaho

51.4

Michigan State

17.5

Utah

34.7

Washington Univ.

23.3

Utah

17.5

Emory

29.6

Emory

22.9

Minnesota

17.1

Arizona

28.9

Georgetown

20.8

Emory

16.5

Minnesota

22

George Wash.

20.2

Cal. Berkeley

16.2

George Wash.

21.8

Cal. Berkeley

19.4

Rutgers - Camden

14.9

Georgetown

21.2

Florida St.

18.2

Georgetown

14.7

Rutgers – Camden

20.7

Rutgers - Camden

17.1

Southern Cal.

14.7

Southern Cal.

19.7

Southern Cal.

17.1

Northwestern

14.4

Texas

19.1

Minnesota

16.7

Cincinnati

14.3

Cincinnati

17.5

Utah

15.9

Columbia

14.3

Northwestern

17.1

Northwestern

15.3

Buffalo

14.2

Washington Univ.

15.4

UCLA

15

Arizona

14

Univ. Washington

15.3

Seton Hall

14.5

Cardozo

13.8

Columbia

14.2

Florida Int.

13.9

SMU

13.4

American

13.8

Texas

13.5

Florida

12.7

SMU

13.3

Columbia

13.1

Chicago

12.6

UCLA

13.3

Richmond

12.8

George Wash.

12.5

Chicago

13

Univ. Washington

12.6

 

 

 

 

Houston

12.6

 

Note that in these two charts, the “repeat players” -- those schools in the top 20 for all three years -- are bolded.  In  2013 and 2014, nine of the top ten schools for number of transfers repeated.  (The notable newcomer this year is Idaho, which received 55 transfers from the Concordia University School of Law when Concordia did not receive provisional accreditation from the ABA.)  Across all three years, eight of the top ten schools for percentage of transfers repeated.

Top Ten Law Schools as a Percentage of All Transfers

 

2006

2011

2012

2013

2014

Total Transfers

482

570

587

724

625

Transfers to 10 Schools with Most   Transfers

2265

2427

2438

2501

2187

Transfers to 10 Schools with Most   Transfers as % of   Transfers

21.3%

23.5%

24.1%

28.9%

28.6%

 

The chart above demonstrates an increasing concentration in the transfer market between 2006 and 2014 and even moreso between 2012 and 2014, as the ten law schools with the most students transferring captured an increasing share of the transfer market. 

NATIONAL AND REGIONAL MARKETS BASED ON NEW DATA

Starting this fall, the ABA Section of Legal Education and Admissions to the Bar began collecting and requiring schools with more than five transfers in to report not only the number of students who have transferred in, but also the schools from which they came (indicating the number from each school) along with the 75%, 50% and 25% first-year, law school GPAs of the pool of students who transferred in to a given school (provided that at least twelve students transferred in to the school).  This allows us to begin to explore the nature of the transfer market by looking at where students are coming from and are going and by looking at the first-year GPA profile of students transferring in to different law schools. 

Percentage of Transfers from Within Geographic Region and Top Feeder School(s)

USNews

Ranking

School

# Transfers

Region

Regional

Transfers

Reg. %

Feeder

Schools

#

2

Harvard

33

NE

6

18

Emory-Wash. Univ.

3

4

Columbia

46

NE

19

41

Brooklyn

5

6

NYU

50

NE

20

40

Cornell

8

9

Berkeley

55

CA

43

78

Hastings

18

12

Northwestern

35

MW

24

69

DePaul-Chicago Kent-Loyola

5

13

Georgetown

113

Mid-Atl

49

43

American

13

15

Texas

43

TX

27

63

Baylor

5

16

UCLA

44

CA

31

70

Loyola Marymount

8

18

Wash. Univ.

44

MW

20

45

SLU

4

19

Emory

53

SE

40

75

Atlanta’s John Marshall

20

20

GWU

97

Mid-Atl

78

80

American

54

20

Minnesota

37

MW

21

57

William Mitchell

6

20

USC

30

CA

22

73

Southwestern

5

31

Azizona St.

66

SW

51

77

Arizona Summit

44

45

Florida St.

31

SE

24

77

Florida Coastal

9

61

Miami

29

SE

21

72

Florida Coastal

5

72

American

44

Mid-Atl

14

32

Baltimore-UDC

6

87

Michigan St.

33

MD

33

100

Thomas Cooley

31

87

Loyola Marymount

32

CA

26

81

Whittier

15

 

For this set of 19 schools with the most transfer students, the vast majority obtained most of the transfers from within the geographic region within which the law school is located.   Only two schools (Harvard and American) had fewer than 40% of their transfers from within the region in which they are located and only four others (Columbia, NYU, Georgetown and Washington University) had fewer than 50% of the transfers from within their regions.  Meanwhile, ten of the 19 schools had 70% or more of their transfers from within the region in which the school is located. 

Moreover, several schools had a significant percentage of their transfers from one particular feeder school.  For Berkeley, roughly 33% of its transfers came from Hastings; for Emory, nearly 40% of its transfers came from Atlanta’s John Marshall Law School; for George Washington, over 55% of its transfers came from American; for Arizona State, 67% of its transfers came from Arizona Summit; for Michigan State nearly 95% of its transfers came from Thomas Cooley; for Loyola Marymount, nearly 50% of its transfers came from Whittier; and for Idaho, over 95% of its transfers came from Concordia.

 Percentage of Transfers from Different Tiers of School(s)

Along With First-Year Law School GPA 75th/50th/25th

USNews Ranking

 

# of Trans.

Top 50

# -- %

51-99

# -- %

100-146

# -- %

Unranked

            # -- %

GPA 75th

GPA 50th

GPA 25th

2

Harvard

33

23

70

10

30

0

0

0

0

3.95

3.9

3.83

4

Columbia

46

29

63

14

30

3

7

0

0

3.81

3.75

3.69

6

NYU

50

41

82

7

14

2

4

0

0

3.74

3.62

3.47

9

Berkeley

55

17

31

27

33

6

11

5

9

3.9

3.75

3.68

12

Northwestern

35

16

46

12

34

6

17

1

3

3.73

3.56

3.4

13

Georgetown

113

27

24

38

34

17

15

31

27

3.77

3.67

3.55

15

Texas

43

17

40

13

3

9

21

4

9

3.62

3.45

3.11

16

UCLA

44

15

34

23

52

2

5

4

9

3.73

3.58

3.44

18

Wash. Univ.

44

3

7

25

57

1

2

15

34

3.43

3.2

3.06

19

Emory

53

3

6

7

13

8

15

35

66

3.42

3.27

2.93

20

GWU

97

13

13

73

75

11

11

0

0

3.53

3.35

3.21

20

Minnesota

37

4

11

12

32

18

49

3

8

3.3

3.1

2.64

20

USC

30

1

3

11

37

6

20

12

40

3.71

3.59

3.44

31

Arizona St.

66

4

6

5

8

8

12

49

74

3.51

3.23

2.97

45

Florida St.

31

2

6

4

13

3

10

22

71

3.29

3.1

2.9

61

Miami

29

1

3

4

14

6

21

18

62

3.3

3.07

2.87

72

American

44

2

5

14

32

3

7

25

57

3.25

2.94

2.78

87

Michigan St.

33

0

0

0

0

1

3

32

97

3.19

3.05

2.83

87

Loyola Mary

32

0

0

0

0

1

3

31

97

3

3

3

 

The chart above shows the tiers of law schools from which the largest schools in the transfer market received their transfer students.  Thirteen of the top 19 schools for transfers are ranked in the top 20 in USNews, but of those 13, only six had 80% or more of their transfers from schools ranked between 1 and 99 in the USNews rankings – Harvard, Columbia, NYU, Northwestern, UCLA and George Washington.  Three additional schools had at least 50% of their transfers from schools ranked between 1 and 99, Berkeley, Georgetown and Washington University.  The other ten schools had at least half of their transfer students from schools ranked 100 or lower, with some schools having a significant percentage of their transfers from schools ranked alphabetically.  This data largely confirms the analysis of Bill Henderson and Jeff Rensberger regarding the rankings migration of transfers – from lower ranked schools to higher ranked schools.

In addition, as you move down the rankings of transfer schools, the general trend in first-year law school GPA shows a significant decline, with several highly-ranked schools taking a number of transfers with first-year GPAs below a 3.0, including Emory, Minnesota, Arizona State, and Florida State.

STILL MANY UNKNOWNS

This new data should be very helpful to prospective law students and to current law students who are considering transferring.  This data gives them at least a little better idea of what transfer opportunities might be available to them depending upon where they go to law school as a first-year student.

Even with this more granular data now available, however, as I noted in my earlier posting on transfer students, there still are a significant number of unknowns relating to transfer students.  These unknowns cover several different points.  

First, what is the acceptance rater for transfers?  We now know how many transferred came from different schools and we have some idea of first-year GPA ranges for those admitted as transfers, but we do not know the acceptance rate on transfers.  Are a significant percentage of transfers not admitted or are most students interested in trasnferring finding a new home someplace.

Second, what are motivations of transfers and what are the demographics of transfers?  Are transfers primarily motivated by better employment opportunities perceived to be available at the higher-ranked law school?  Are some subset of transfers primarily motivated by issues regarding family or geography (with rankings and employment outcomes as secondary concerns)?

Third, how do the employment outcomes of transfer students compare with the employment outcomes of students who started at a given law school?  Does the data support the perception that those who transfer, in fact, have better employment outcomes by virtue of transferring?

Fourth, what are the social/educational experiences of transfers in their new schools and what is the learning community impact on those schools losing a significant number of students to the transfer market?

For those interested in these issues, it might make sense to design some longitudinal research projects that could help find answers to some of these questions.

December 20, 2014 in Current events, Data on legal education | Permalink | Comments (0)

Wednesday, December 10, 2014

BETTER UNDERSTANDING THE TRANSFER MARKET

What do we know about the transfer student market in legal education? 

Not enough.  But that will begin to change in the coming weeks.

NUMBER/PERCENTAGE OF TRANSFER STUDENTS HAS INCREASED MODESTLY

Up until this year, the ABA Section of Legal Education and Admissions to the Bar only asked law schools to report the number of transfer students “in” and the number of transfer students “out.”  This allowed us to understand roughly how many students are transferring and gave us some idea of where they are going, and where they are coming from, but not with any direct “matching” of exit and entrance.

Has the number and percentage of transfer students changed in recent years?

In 2010, Jeff Rensberger published an article in the Journal of Legal Education in which he analyzed much of the then available data regarding the transfer market and evaluated some of the issues associated with transfer students.  He noted that from 2006 to 2009 the number of transfer students had remained within a range that represented roughly 5% of the rising second-year class (after accounting for other attrition) – 2,265 in summer 2006, 2,324 in summer 2007, 2,400 in summer 2008, and 2,333 in summer 2009.)  

Using data published in the law school Standard 509 reports, the number of transfers in 2011, 2012 and 2013 has increased only marginally, from 2427 to 2438 to 2501, but, given the declining number of law students, it has increased as a percentage of the preceding year’s first-year “class,” from 4.6% to 5.6%.  Thus, there is a sense in which the transfer market is growing, even if not growing dramatically.

Numbers of Transfer Students 2006-2008 and 2011-2013

 

2006

2007

2008

2011

2012

2013

Number of Transfers

2265

2324

2400

2427

2438

2501

Previous Year First Year Enrollment

48,100

48,900

49,100

52,500

48,700

44,500

% of Previous First-Year Total

4.7%

4.8%

4.9%

4.6%

5%

5.6%

 

SOME SCHOOLS DOMINATE THE TRANSFER MARKET

In 2008, Bill Henderson and Brian Leiter highlighted issues associated with transfer students.   Henderson and Leiter were discussing the data from the summer of 2006.  Brian Leiter posted a list of the top ten law schools for net transfer students as a percentage of the first year class.  Bill Henderson noted the distribution of transfer students across tiers of law schools (with the law schools in the top two tiers generally having positive net transfers and the law schools in the bottom two tiers generally having negative net transfers), something Jeff Rensberger also noted in his 2010 article.   

Things haven’t changed too much since 2006.  In 2012, there were 118 law schools with fewer than 10 “transfers in” representing a total of 485 transfers – slightly less than 20% of all transfers.  On the other end, there were 21 schools with 30 or more “transfers in” totaling 996 transfers -- nearly 41% of all transfers. Thus, roughly 10% of the law schools occupied 40% of the market (increasing to nearly 44% of the market in 2013).

We also know who the leading transfer schools have been over the last three years.  The following two charts list the top 20 transfer schools in Summer 2011 (fall 2010 entering class), Summer 2012 (fall 2011 entering class) and Summer 2013 (fall 2012 entering class) – with one chart based on “numbers” of transfers and the other chart based on the number of transfer students as a percentage of the prior year’s first year class.

Largest Law Schools by Number of Transfers in 2012 and 2013

(BOLD indicates presence on list all three year)

 

School

Number in 2011

School

Number in 2012

School

Number in 2013

George Wash.

104

Florida State

89

Georgetown

122

Georgetown

71

Georgetown

85

George Wash.

93

Florida St.

57

George Wash.

63

Florida St.

90

New York Univ.

56

Columbia

58

Emory

75

American

53

Michigan State

54

Arizona State

73

Michigan State

52

New York Univ.

53

American

68

Columbia

46

American

49

Texas

59

Cardozo

45

Cardozo

48

Columbia

52

Loyola Marymount

44

Loyola Marymount

46

New York Univ.

47

Washington Univ.

42

Rutgers - Camden

42

Minnesota

45

Cal. Los Angeles

40

Minnesota

42

Arizona

44

Michigan

39

Arizona State

42

Northwestern

44

Northwestern

39

Cal. Berkeley

41

Cal. Los Angeles

41

Rutgers - Camden

36

Emory

41

Cardozo

38

San Diego

35

Cal. Los Angeles

39

Southern Cal.

37

Arizona State

34

Northwestern

38

Utah

34

Brooklyn

33

Florida

37

Harvard

34

Cal. Hastings

32

Maryland

34

Florida

33

Minnesota

31

Michigan

33

Cal. Berkeley

32

Lewis & Clark

30

SMU

31

Washington Univ.

31

Harvard

30

Harvard

31

   

 

Largest Law Schools by Transfers as a Percentage of Previous First Year Class

(BOLD indicates presence on list in both years)

 

 School

Percentage 2011 (as a percentage of the 2010 first year class)

School

Percentage 2012

(as a percentage of the 2011 first year class)

School

Percentage 2013

(as a percentage of the 2012 first year class)

Florida St.

28.6

Florida St.

44.5

Florida State

48.1

George Wash.

19.9

Arizona State

24.6

Arizona State

48

Utah

19.7

Michigan State

17.5

Utah

34.7

Arizona State

17.8

Utah

17.5

Emory

29.6

Michigan State

17.4

Minnesota

17.1

Arizona

28.9

Washington and Lee

15.3

Emory

16.5

Minnesota

22

Washington Univ.

15.2

Cal. Berkeley

16.2

George Wash.

21.8

Loyola Marymount

15.1

Rutgers - Camden

14.9

Georgetown

21.2

Northwestern

14.2

Georgetown

14.7

Rutgers – Camden

20.7

Richmond

13.7

Southern Cal.

14.7

Southern Cal.

19.7

Rutgers - Camden

13.4

Northwestern

14.4

Texas

19.1

Cal. Los Angeles

13

Cincinnati

14.3

Cincinnati

17.5

Cal. Davis

12.8

Columbia

14.3

Northwestern

17.1

Lewis & Clark

12.1

Buffalo

14.2

Washington Univ.

15.4

Georgetown

12

Arizona

14

Univ. Washington

15.3

Minnesota

11.9

Cardozo

13.8

Columbia

14.2

New York Univ.

11.8

SMU

13.4

American

13.8

Cardozo

11.8

Florida

12.7

SMU

13.3

Columbia

11.4

Chicago

12.6

Cal. Los Angeles

13.3

Buffalo

11

George Wash.

12.5

Chicago

13

 

Note that in these two charts, the “repeat players” are bolded – those schools in the top 20 for all three years – 2011, 2012 and 2013.  (Four of the top ten schools Leiter highlighted from the summer of 2006 remain in the top ten as of the summer of 2013, with four others still in the top 20.)  In addition, it is worth noting some significant changes between 2011 and 2013.  For example, the number of schools with 50 or more transfers increased from six to eight with only two schools with more than 70 transfers in 2011 and 2012, but with five schools with more than 70 transfers in 2013. 

Leiter’s top ten law schools took in a total of 482 transfers, representing 21.3% of the 2,265 transfers that summer.  The top ten law schools in 2011 totaled 570 transfers, representing 23.5% of the 2427 transfer students that summer.  The top ten law schools in 2012 totaled 587 transfers, representing 24.1% of the 2438 transfers that summer.  The top ten law schools in 2013, however, totaled 724 students, representing 28.9% of the 2501 transfers in 2013, demonstrating an increasing concentration in the transfer market between 2006 and 2013 and even moreso between 2012 and 2013. 

In addition, three of the top four schools with the highest number of transfers were the same all three years, with Georgetown welcoming 71 in the summer of 2011, 85 in the summer of 2012, and 122 in the summer of 2013, George Washington, welcoming 104 in the summer of 2011, 63 in the summer of 2012, and 93 in the summer of 2013, and Florida State welcoming 57 in the summer of 2011, 89 in the summer of 2012 and 90 in the summer of 2013.  (Notably, Georgetown and Florida State were the two top schools for transfers in 2006, with 100 and 59 transfers in respectively.)

Similarly, three of the top four schools with the highest “percentage of transfers” were the same all three years, with Utah at 19.7% in 2011, 17.5% in 2012 and 34.7% in 2013, Arizona State at 17.8% in 2011, 24.6% in 2012 and 48% in 2013, and Florida State at 28.6% in 2011, 44.5% in 2012 and 48.1% in 2013.  The top five schools on the “percentage of transfers” chart all increased the “percentage” of transfer students they welcomed between 2011 and 2013, some significantly, which also suggests greater concentration in the transfer market between 2011 and 2013.

More specifically, there are several schools that have really “played” the transfer game in the last two years – increasing their engagement by a significant percentage.  These eight schools had 10.2% of the transfer market in 2011, but garnered 22.2% of the transfer market in 2013.

Schools with Significant Increases in Transfers 2011-2013

School

2011

2012

2013

Percentage Increase

Texas

6

9

59

883%

Arizona

6

24

44

633%

Emory

19

41

75

295%

Arizona State

34

42

73

115%

Georgetown

71

85

122

70%

Florida State

57

89

90

58%

Southern Cal

24

29

37

54%

Minnesota

31

42

45

45%

Totals

248

371

555

124%

 

REGIONAL MARKETS

There appear to be “regional” transfer markets.  In the Southeast in 2013, for example, three schools -- Florida State, Florida and Emory -- had a combined net inflow of 180 transfer students, while Stetson and Miami were flat (43 transfers in and 42 transfers in, combined) and eight other schools from the region -- Florida Coastal, Charlotte, Charleston, Atlanta’s John Marshall, St. Thomas University, Ave Maria, Florida A&M, Nova Southeastern – had a combined net outflow of 303.  It seems reasonable to assume that many of the transfers out of these schools found their way to Emory, Florida and Florida State (and perhaps to Miami and Stetson to the extent that Miami and Stetson lost students to Emory, Florida and Florida State).

NEW DATA – NEW INSIGHTS

Starting this fall, the ABA Section of Legal Education and Admissions to the Bar is collecting and requiring schools to report not only the number of students who have transferred in, but also the schools from which they came (indicating the number from each school) along with the 75%, 50% and 25% first-year, law school GPAs of the pool of students who transferred in to a given school (provided that at least five students at the school transferred in).  As a result, we will be able to delineate the regional transfer markets (as well as those schools with more of a national transfer market.

Notably, even though the Section of Legal Education and Admissions to the Bar is not requiring the gathering and publication of the 75%, 50%, and 25% LSAT and UGPA, one thing we are very likely to learn is that for many schools, the “LSAT/UGPA” profile of transfers in is almost certainly lower than the LSAT/UGPA profile of the first-year matriculants in the prior year, a point that both Henderson and Rensberger highlight in their analyses. 

Just look at the schools in the Southeast as an example.  Assume Emory, Florida State and Florida (large “transfer in” schools) are, in fact, admitting a significant number of transfer students from other schools in the Southeast region, such as Miami and Stetson, and schools like Florida Coastal, St. Thomas University, Charlotte, Atlanta’s John Marshall and Ave Maria (large “transfer out” schools in the Southeast).  Even if they are taking students who only came from the top quarter of the entering classes at those schools, the incoming transfers would have a significantly less robust LSAT/UGPA profile when compared with the entering class profile at Emory, Florida State or Florida in the prior year.  Virtually every student who might be transferring in to Emory, Florida or Florida State from one of these transfer out schools (other than Miami and perhaps Stetson) is likely to be in the bottom quarter of the entering class LSAT profile at Emory, Florida, and Florida State.

Comparison of Relative Profiles of Southeast Region Transfer In/Out Schools

TRANSFER IN SCHOOLS

2012 LSAT

2012 UGPA

TRANSFER OUT SCHOOLS

2012 LSAT

 2012 UGPA

Emory

166/165/161

3.82/3.70/3.35

Miami

159/156/155

3.57/3.36/3.14

Florida

164/161/160

3.73/3.59/3.33

Stetson

157/157/152

3.52/3.28/3.02

Florida State

162/160/157

3.72/3.54/3.29

St. Thomas (FL)

150/148/146

3.33/3.10/2.83

 

 

 

Florida Coastal

151/146/143

3.26/3.01/2.71

 

 

 

Charlotte

150/146/142

3.32/2.97/2.65

 

 

 

Atlanta’s John Marshall

153/150/148

3.26/2.99/2.60

 

 

 

Ave Maria

153/148/144

3.48/3.10/2.81

 

This raises an interesting question about LSAT and UGPA profile data.  If we assume that LSAT and UGPA profile data are used not only by law schools as predictors of performance, but that third parties also use this data as evidence of the “strength” of the student body, and ultimately the graduates, of a given law school (for example, USNEWS in its rankings and employers in their assessment of the quality of schools at which to interview), what can we surmise about the impact from significant numbers of transfers?  For those law schools with a significant number/percentage of “transfers in” from law schools whose entering class profiles are seemingly much weaker, the entering class profile presently published in the Standard 509 disclosure report for each school arguably fails to accurately reflect the LSAT and UGPA quality of the graduating class.  Similarly, if the “transfers out” from a given school happen to come from the top half of the entering class profile, then for these schools as well the entering class profile presently published in the Standard 509 disclosure report for each school arguably fails to accurately reflect the LSAT and UGPA quality of the graduating class. 

Using the chart above, if Emory, Florida and Florida State are drawing a significant number of transfers from the regional transfer out schools, and if they had to report the LSAT and UGPA profile of their second-year class rather than their first-year class, their LSAT and UGPA profiles almost certainly would decline.   (The same likely would be true for other law schools with large numbers of transfers.)

STILL MANY UNKNOWNS

Even with more granular data available in the near future to delineate more clearly the transfer pathways between transfer out schools and transfer in schools, there still will be a significant number of unknowns relating to transfer students, regarding employment outcomes, the demographics of transfers, the experience of transfers and the motivation for transfers.

First, with respect to the employment outcomes of transfer students, how do they compare with the employment outcomes for students who started at a law school as first-years? Do the employment outcomes for transfer students track that of students who started at a law school as first-years, or is the employment market for transfer students less robust than it is for students who started at a law school as first-years?  Are the employment outcomes nonetheless better than they might have been at the school from which they transferred? These are important questions given the perception that many students transfer “up” in the rankings to improve their employment opportunities. 

Second, with respect to demographics, do students of color and women participate proportionately in the transfer market or is the market disproportionately occupied by white males?

Third, with respect to the experience of transfers, the Law School Survey of Student Engagement gathered some data from participating law schools in 2005 regarding the experience of transfers but more could be done to better understand how integrated transfer students are in the life of the learning community into which they transfer.

Fourth, with respect to the motivations of transfers, it is generally assumed that transfers are “climbing” the rankings, and Henderson’s data broadly suggests movement from lower-ranked schools to higher-ranked schools, but what percentage of transfers are doing so partly or primarily for geographic reasons – to be near family or a future career location?  How many are transferring for financial reasons because they lost a conditional scholarship after their first year of law school?  How many truly are transferring to get a JD from a higher ranked law school?  How many of those believe their job opportunities will be better at the school to which they are transferring?

We will have answers to some questions soon, but will still have many questions that remain unanswered.

December 10, 2014 in Data on legal education | Permalink | Comments (10)

Tuesday, December 2, 2014

The Market for Law School Applicants -- A Milestone to Remember

In early 2013, Michael Moffitt, the dean of Oregon Law, was interviewed by the New York Times about the tumult affecting law schools. Moffitt, who is a very thoughtful guy, reponded, "I feel like I am living a business school case study.”  

I think the analogy to the business school case study is a good one.  In the nearly two years since that story was published, the market for law school applicants has actually gotten worse.

Yesterday's Dealbook column in the New York Times featured Northwestern Law Dean Dan Rodriguez (who also serves at President of the AALS) speaking candidly about the meltdown dynamics that have taken hold.  See Elizabeth Olson, "Law School is Buyer's Market, with Top Students in Demand," New York Times, Dec. 1, 2014. 

DanRodriguez"It's insane," said Rodriguez, "We’re in hand-to-hand combat with other schools." The trendlines are indeed terrible.  Year-over-year, LSAT test-taker volume is down another 8.7%.  See Organ, LWB, Nov 11, 2014.  So we can expect the situation to get worse, at least in the near term.      

I applaud Dan Rodriguez for this leadership instincts.  He is being transparent and honest.  Several years ago the leadership of the AALS went to great lengths to avoid engagement with the media. Dan has gone the opposite direction, inviting the press into our living room and kitchen.  

Want to know what leadership and judgment look like?  It looks like Dan's interview with Elizabeth Olson.  Dan's words did not solve anyone's problem, but his honesty and candor made it more likely that we help ourselves.  Because it's Northwestern, and Dan is president of the AALS (something the story did not mention but most of us know), and this was reported by Elizabeth Olson in the New York Times, the substance and tenor of discussions within law school faculties is bound to shift, at least slightly and in the direction favoring change.   

What is the de facto plan at most law schools these days?  Universities are not going to backstop law schools indefinitely. I think the sign below is not far off the mark.  

Outrun-the-bear

We are indeed living through a business school case study, which is both bad and good.   At many schools -- likely well more than half --  hard choices need to be made to ensure survival.  (And for the record, virtually all schools, regardless of rank, are feeling uncomfortable levels of heat.)   A law school needs cash to pay its expenses.  But it also needs faculty and curricula to attract students. The deeper a law school cuts, the less attractive it becomes to students.  Likewise, pervasive steep discounts on tuition reflect a classic collective action problem. Some schools may eventually close, but a huge proportion of survivors are burning through their financial reserves.  

Open admissions, which might pay the bills today, will eventually force the ABA and DOE to do something neither really want to do -- aggressively regulate legal education.  This is not a game that is likely to produce many winners.  Rather than letting this play out, individual law schools would be much better off pursuing a realistic strategic plan that can actually move the market. 

The positive side of the business school case study is that a few legal academics are finding their voice and learning -- for the first time in several generations -- how to lead.  Necessity is a wonderful tutor.  Law is not an industry on the decline -- far from it.  The only thing on the decline is the archetypal artisan lawyer that law schools are geared to churn out.  Indeed, back in 2013 when Dean Moffitt commented about living through a business school case study, he was not referencing imminent failure.   Sure, Moffitt did not like the hand he was being dealt, but as the 2013 article showed, his school was proving to be remarkably resourceful in adapting.

The good news resides on the other side of a successful change effort.  The process of change is painful, yet the effects of change can be transformative and make people truly grateful for the pain that made it all possible.  In our case, for the first time in nearly a century, what we teach, and how we teach it, is actually going matter.  If we believe serious publications like The Economist, employers in law, business, and government need creative problem solvers who are excellent communicators, adept at learning new skills, and comfortable collaborating accross multiple disciplines -- this is, in fact, a meaningful subset of the growing JD-Advantage job market.

In the years to come, employers will become more aggressive looking for the most reliable sources of talent, in part because law schools are going to seek out preferred-provider relationships with high quality employers.  Hiring based on school prestige is a remarkably ineffective way to build a world-class workforce -- Google discovered this empirically.  

From an employer perspective, the best bet is likely to be three years of specialized training, ideally where applicants are admitted based on motivation, aptitude, and past accomplishments. The LSAT/UGPA grid method misses this by a wide margin. After that, the design and content of curricula are going to matter.  It is amazing how much motivated students can learn and grow in three years. And remarkably, legal educators control the quality of the soil.  It brings to mind that seemingly trite Spiderman cliche about great power.

For those of us working in legal education, the next several years could be the best of times or the worst of times.  We get to decide.  Yesterday's article in the Times made it a little more likely that we actually have the difficult conversations needed to get to the other side. 

December 2, 2014 in Current events, Data on legal education, Innovations in legal education, New and Noteworthy, Structural change | Permalink | Comments (4)