Thursday, July 5, 2012

Which law schools lose the most when applicants decline?

This is a simple question of great practical importance to many law schools, yet very few law school administrators understand how to answer it.  Who would have thought that clarity would be supplied free-of-charge by an underemployed recent law school graduate? 

Matt_LeichterBut that is what is happening now, in "Tough Choices Ahead for Some High-Ranked Law Schools," an Am Law Daily essay written by Matt Leichter, one of the silver linings of the declining legal job market -- and there aren't too many.  Matt is a J.D.-M.A. in law and international affairs from Marquette University who passed the New York bar in 2008, finished his masters work in 2009, and then moved to the Big Apple as the bottom was falling out of the entry level market.  Unable to find conventional legal employment, Matt started doing freelance writing on law-related topics. 

With plenty of time on his hands, Matt turned his graduate-level quantitative skills to the task of analyzing a law school education market that seemed unsustainable.  Matt first put his analyses on display at the Law School Tuition Bubble.  His writings eventually attracted the attention of The American Lawyer, which has now published several of his data-driven essays.

Here is what sets Matt apart. 

  • He digs very deep for facts and, in turn, uses one of his biggest asset --time -- to build datasets that answer important and relevant questions
  • He is non-ideological.  Just facts and factual analysis.
  • He writes about complex technical stuff in an accessible, credible way

Matt has all the core skills of a truly great lawyer.  Finding no takers, the entire legal education establishment benefits by Matt channeling his time, energy, and considerable intellect into relevant topics crying out for dispassionate analysis.

His "Tough Choices" essay is a real gem.  Here is the bottomline:  This year's applicant cycle likely will deliver its greatest blow to US News Tier 1 schools who generally admit students who were angling to get into even higher ranked schools.  This inference can be teased out of the ratio of applicants to offers (selectivity), and offers to matriculants (yield).  

To conduct this analysis, Matt had to cull data, school-by-school, from several years of the ABA-LSAC Official Guide to Law Schools (aka "the Phonebook"). But it enables him to produce the chart below:

Applications_acceptances1

What this chart says is that admissions officers have to read more applications and make more offers to fill their entering classes.  Based on the data in Matt's chart, in 2004, for all ABA-accredited law schools, there was a 24% acceptance rate, and a 31% yield from those offers.  In 2010, the acceptance rate went up to 31% (schools were being less selective) and the yield went down to 25% (fewer showed up to enroll). 

Applicant volume may be declining, but the trends above suggest that there is a lot more "competitive shopping" going on. Why? Because information costs are going down and prospective students are adapting.  And this year is bound to be the most aggressive year ever.  According to this NLJ story, It's a Buyers' Market for Law School, virtually every student is now negotiating for scholarship money.

Declining applicant volume, shifting yields, and highly informed consumers make it very difficult for law school administrators to lock in their LSAT and UGPA numbers, which schools generally fixate on because of U.S. News ranking.  This produces pain in one of three ways:

  1. The school shrinks the entering class (announced by at least 10 schools), which severely tightens the budget
  2. The school buys its class through financial aid, which blows a hole in the budget (happening here)
  3. The school significantly relaxes the LSAT and UGPA and braces for a drop in the rankings because its peers are pursuing strategies #1 or #2.

#1 and #2 may seem like the prudent course, but a central university won't (more likely can't) provide a financial backstop for more than a year or two, if that.  If the admissions environment does not change dramatically, which seems unlikely, some combination of layoffs, rankings drop, or closures will have to be put on the table.

Matt's ingenuity is on full display when he demonstrates, with data, the profile of the most vulnerable schools -- and its a far cry from the bottom portion of the U.S. News rankings. 

  • Low accept/high yield (think Yale and Stanford) are safe. 
  • High accept/high yield are also fine.  They are nonprestigious but have strong regional niches or missions. Tier 3 or 4 designation means nothing.
  • Low accept/low yield crowd -- a bunch of Tier 1 schools -- are vulnerable to significant rankings volatility.  If they drop, next year's applicant volume will be affected, making it very difficult to rebound.
  • High accept/low yield are the most likely to close.

Until August and September, when the wait lists finally clear, nobody really know the depth of market shift.  Only then can the budget holes be finalized.  Deans will then have candid conversations with their central administrations to answer the question, "Is this downward trend permanent?"

[posted by Bill Henderson]

July 5, 2012 in Blog posts worth reading, Current events, Data on legal education, Important research, Structural change | Permalink | Comments (1)

Monday, July 2, 2012

Betting on the Next Generation of Law School Graduates

CrittendenTwo years ago, I got a call from Jack Crittenden, the editor-in-chief of The National Jurist, a publication targeted at law students.  Jack asked me if I would be interested in writing a column for the magazine. 

After thinking over the offer, I concluded that it would be a good way to "diversify" my intellectual capital.  Many of my ideas are outside the legal academic mainstream and are critical of the status quo.  Yet, I reasoned that law students would be one group more inclined to give me a fair hearing.  Why?  Because in 2010, as in 2012, a disproportionate number of students were/are getting shortchanged by a miserable job market.  When the status quo closes its door on you, the mind naturally becomes open to new ways of viewing the world.  Further, regardless of the current job market, for the next 20 years the influence of this generation of law students will only grow.  

So I accepted Jack's offer and started writing. I will be eternally grateful to Jack for making me that offer (and eternally grateful for tenure, which provides the platform for the long term and the unorthodox).

When I started writing the National Jurist columns, I never quite knew how they would end.  In an attempt to break down the distance between the student and the professor, I recounted some of my own (inglorious) law school experiences.  Unconstrained by form, I just wrote what was honestly on my mind to an audience I really cared about.  It was refreshing, that's for sure, but much to my surprise, these essays seemed to boil down my academic ideas into something useful and practical.  The emails I started receiving from students suggested that I was making progress.

Ironically, the National Jurist writings are now influencing my academic work, including several essays I am writing this summer on legal education and the legal industry.  Yet, the true virtue of those essays may be their brevity.  So, in case you are curious about the subversive ideas I am passing along to our youth, with Jack's permission, I am republishing several of these essays on the Legal Whiteboard.

[posted by Bill Henderson]

July 2, 2012 in Blog posts worth reading | Permalink | Comments (0)

The Client-Focused Lawyer

[by Bill Henderson, originally published in The National Jurist, January 2011 (PDF)]

Over the last three years, the majority of my research has focused on lawyer competencies, or what I prefer to call lawyer success factors.  This research has fundamentally changed my perceptions of legal education, primarily because the majority of success factors are not taught, assessed, or measured during law school.  It is not that we law professors are deliberating ignoring something important.  Rather, we are not even aware that something beyond legal knowledge and technical skills are necessary for success.  

Based upon my own observation, and a fair amount of time sifting through data, I think the single best predictor of both success and satisfaction as a lawyer is the ability to become truly client focused.   Unfortunately, this client-focused mindset is completely absence in the large law school classes that are the core of the law school curriculum.

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July 2, 2012 in Data on legal education, Data on the profession | Permalink | Comments (0)

Seduced by Legal Brands

[by Bill Henderson, originally published in The National Jurist, September 2011 (PDF)]

Every year as the on-campus interview process gears up, another class of high performing law students fret over their chances of getting an offer from a cadre of firms that, a year earlier, they had never heard of.  The thought process goes something like this.  “Oh, these types of firms pay a lot of money.  And among these firms, some are harder to get hired at than others – they are more prestigious.  If I can land a job at one of these firms, the entire legal world will know that I am smart.  That would feel great.  And I can quickly pay off my student loans and keep my options open.” 

Money and peer pressure are a potent mix.  They make it virtually impossible to remember the original reason for applying to law school.

During the dot.com bubble of the late 1990s, I was a student at the University of Chicago Law School.  In the classroom, I was deeply intimidated by my classmates.  But as we ploughed through the OCI process, I was astonished to see my fellow students anguishing over Skadden versus Latham.  Or gnashing their teeth that they might have missed the Chicago grade cutoff for Gibson Dunn.  Weren’t these firms more alike than they were different?  And what made them so great beside the relative difficulty of securing a callback? 

The prevailing analysis during OCI seemed shallow and bereft of reliable facts. We were taking our cues from each other.  Yet, I could sense my own irrational desire to compete and win.  I wish I could say that I was smarter than my classmates.  But that’s not true.  I was just older, and life had already thrown water on my face.

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July 2, 2012 in Data on legal education | Permalink | Comments (0)

Is a Great Lawyer Born or Made?

[By Bill Henderson, originally published in The National Jurist, January 2012 (PDF)]

Many law students spend their 1L year fearing that they might be the admissions mistake.  I was one of them.  The only feedback is what can be gleaned from the professor-student dialogue.  In turn, everyone uses this information (if you can call it that) to handicap their likelihood of making law review or otherwise getting the grades needed to get the most coveted jobs.  The whole process seems very binary:  Am I smart enough to be a successful lawyer, yes or no?

When I became a law professor, my research on law firms and legal education eventually brought me to the topic of lawyer success.  I started collecting examples of lawyers with sterling credentials who failed to develop a significant practice; and those with less impressive pedigree who ended up becoming go-to experts and indispensible lynchpins of their organizations.  What explained these divergent outcomes?

The research of Carolyn Dweck, a cognitive psychologist at Stanford University, provides some important insights to this question.  Before delving into these insights, however, ask yourself whether the following statement is true:  “A lawyer’s skill set is determined primarily by innate ability—you either have enough or you don’t.”

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July 2, 2012 in Data on legal education, Data on the profession, Important research | Permalink | Comments (0)

The Inferiority Complex of Law Schools

[by Bill Henderson, originally published in The National Jurist, March 2012 (PDF)]

For over a century, law schools have suffered from an inferiority complex.  We have masked it well, but its consequences are finally coming home to roost.  Like most psychological conditions, our lives will be much better and healthier when we deal with its root cause.  Further, when law students understand this history, they will better understand the changing nature of the legal economy.  They can even help law schools with the cure.

In 1918, the renowned economist Thorstein Veblen famously quipped, “the law school belongs in the modern university no more than a school of fencing or dancing.”

Veblen, like many of his academic colleagues, believed that universities should be citadels for science-based learning and the production of knowledge.  Law, in contrast, was a trade. Indeed, in the early 1900s, a substantial portion of the practicing bar had obtained their skill and knowledge through office apprenticeships.  When law schools did begin to appear, they were just as likely to be proprietary law schools operating out of a local YMCA than to be part of an established university.

Despite the skepticism of the academic class, there were a host of practical reasons for universities to create (or, in some cases, acquire) a law school.  First, the law was the primary occupation for many elected officials, which held out the prospect of reflected glory.  (Veblen recognized this motivation, which compounded his worry.)  Second, a handful of law schools at prestigious universities had begun adopting the so-called case method, which purported to find objective legal rules and principles akin to a scientist working in a laboratory.  The perceived rigor of the case method provided at least a veneer of science.  Third, with their large lecture halls filled with tuition-paying law students, law schools made money.

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July 2, 2012 in Data on legal education, Innovations in legal education | Permalink | Comments (1)