Wednesday, March 25, 2015

What Happened to the Law School Class of 2010?

Law-app

(With thanks to Legally Drawn)

Deborah Jones Merritt of Ohio State's Moritz College of Law has written a fascinating paper on what happened to the graduating class of 2010. Her study uses data from Ohio and compares it to the After the JD (AJD) study which used the national graduating class of 2000. Merritt's sample includes all those who passed the Ohio Bar examination in 2010. Another paper that treats some of these issues is The Economic Value of a Law Degree by Simkovic and McIntyre, which rates the lifetime value of a law degree at around $1 million.

 Merritt's use of Ohio appears to match national attributes (see Table II) but the single state approach means she can capture almost the entire population for 2010. She discloses her methodology fully and I won't discuss it here yet it's worth reading for both its successes and its limits.

The first key finding is how few lawyers got jobs that required a law licence (68%) and within that only a small proportion (40%) found jobs in law firms. And a year after graduating 10% remained unemployed. Four years later in 2014 the situation was little better. One per cent more had law firm jobs while the same proportion had jobs that required no licence (18%) and the unemployed came down to only 6.3%.

In contrast the AJD cohort showed more success. Nearly 80% had jobs requiring law licences and nearly 50% had jobs in law firms. Only 10% had jobs not requiring a licence and a mere 6.3% were unemployed.

The Ohio group changed jobs more frequently and their employment was episodic whereas the AJD group seemed to show continuing progress in the labour market. The AJD group worked in bigger law firms while the Ohio group appeared to gravitate to solo practice and small firm work. The economic pickup in the post-recession years didn't create jobs for the Ohio class in the bigger law firms. The consequence of this is that the Ohio class earned considerably less than the AJD group and didn't receive the same mentoring opportunities by virtue of working in small firms which engaged in less of these types of activities. Many of the Ohio cohort started their own, not very successful, solo practices. These tended to close down early on.

Government jobs showed equal numbers between the Ohio and AJD groups but after four years the Ohio group was disproportionately located in non-law government jobs. A similar process occurred with business jobs where Ohio ended up with a greater proportion of non-law posts in business than the AJD group.

Gender differences lived up/down to expectations as men were more likely to be in private practice while women were in state and local government and business jobs. In the AJD group the differences were never so marked.

Merritt points to the usual suspects or culprits for these results: disaggregation of legal work; disrupting technologies; deskilling of legal work, e.g. non-lawyer compliance officers; oversupply of lawyers; and global competition from,e.g. legal process outsourcers.

The consequences aren't good for law schools who are dealing with declining enrolments and squeezes on tuition levels with flat employment prospects for their graduates. Merritt argues that law schools will have to think creatively about future legal education. She asserts the changes occurring are not temporary but systemic and law schools will have to work out how to cater for law related jobs as well as those requiring law licences.

As a last thought I can't help but wonder if this is a particularly American phenomenon or whether we might see similar changes in Europe and Asia, for example. It doesn't appear so yet. Maybe the regulatory freedoms enjoyed by the legal services markets in the UK and Australia (and potentially other countries) are liberating the markets from old, hidebound, traditional ways of doing business that are generating new opportunities for law graduates. I see this in the UK. Perhaps then the US legal profession (and its regulators) is its own worst enemy.




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