What is the Market Like for a Graduated Law Student?

Although annual ranking data and statistics published by “U.S. News and World Report” give a good impression of and positive outlook on today’s professional legal job market, the current generation of young J.D.s are faced with one of the bleakest job markets in decades. Since 2008, approximately 15,000 positions for attorneys and legal staff at large corporate law firms have been cut, as shown by the results of a study from Northwestern Law. In many instances, both associates and partners have been subject to layoffs, and numerous legal staffing recruitment programs have been greatly reduced or even eliminated. The year 2009 proved to be the lowest point in terms of job reductions, layoffs and an overall hiring downswing. Yet, although the job market for young attorneys is attempting a tentative upswing in 2011, just how much progress it can make toward genuine improvement is yet to be seen.

Lawyer Employment Rates

Many law firms are currently still in the process of slashing expense budgets, and much entry level legal and support staff work is being outsourced to contract employees in various states of the U.S. and abroad. Other countries now receiving outsourced legal work from the United States include India, Malaysia and the Philippines. Yet, some statistics do show improvement in employment rates among newly graduated U.S. law students. In 1997, “U.S. News” published their first statistics revealing the percentages of law school grads securing jobs in law firms during the nine months following receipt of their J.D. degrees. That percentage has risen from 84% in 1997 to 93% in 2011.

Highest ranking U.S. law schools (Yale, Harvard, Stanford and Columbia) report typical salaries for entry level attorney’s positions at around $160,000 (with the potential of eventually escalating to well over $1 million, in a healthy economy). A common complaint among today’s law professors is that the optimistic figures and reports of success for recently graduated law students seeking employment opportunities reflect unscrupulous accounting and financial reporting standards by certain law schools and firms. Many surveys allegedly list young law grads as employed, even if they now hold part-time jobs at Burger King or Wal-Mart.

Law school deans and faculty members often align such cover-ups with the fact that the fate of modern law schools depends on rankings. Large amounts of money are also involved in assuring the long-term survival and credibility of these law schools. Even at law schools with average ratings, annual tuition can be $43,000, and classes require no expensive labs or equipment. As a result, law professors are very highly paid and law schools within university systems usually subsidize other areas of higher education. Although it may be disrespectful to refer to such law schools as cash cows, they most assuredly do bring in large sums of money.

Angry Young Attorneys

Many angry young attorneys are now voicing their opinions and complaints on Internet law school scam blogs. The anonymous author of the blog entitled “Third Tier Reality” commented (in reference to law schools in the lowest tiers of the “U.S. News” rankings), '"Avoid this overpriced sewer pit as if your life depended on it . . . unless, of course, you think that you will be better off with $110k – $190k in non-dischargeable debt for a degree that qualifies you to wait tables at the Battery Park Bar and Lounge.”’ Although the amount of job openings for attorneys has dropped dramatically, the number of law students as well as law schools in the U.S. is on the rise. Many students are attracted by the prestige of a law degree, even in a tough economic climate. Some law schools (e.g., Georgetown), are now hiring unemployed alumni to work in clerical or lower administrative jobs paying $20 per hour.

Some recent law school graduates are working as legal temps. However, available temporary work is often limited, paying less than $35 per hour. Some legal employment agencies are listing job openings for lawyers on Craigslist, Internet job posting sites, and social media networking websites. Many young attorneys are accepting less than challenging, low-paying legal work in metropolitan areas, while numerous regions of the country are greatly in need of good lawyers.

Public-interest Attorneys

Young lawyers who find public-interest legal work and careers are often faced with low financial returns. Even in this area, new jobs do not always come easily, and loans are increasingly difficult for recent law school grads to repay. According to the American Bar Association, over 80% of law students now depend on student loans. Consequently, graduating law students can easily have outstanding loans totaling $150,000 to $250,000. By necessity, they have actually invested amounts others may have put into real estate, to obtain their law degrees. Young law graduates working for the Legal Aid Society may find their work worthwhile and meaningful, and their clients may be very appreciative. However, these young attorneys must be prepared to reconcile the vastly diminished monetary returns on their investment in law degrees.

According to “The American Lawyer” magazine, during 2009, the 100 most successful U.S. law firms suffered an average decrease in revenues of 3.4%. This was their first such loss in 20 years. The same year, Morrison & Foerster LLP of San Francisco hired around 30% less law school grads than in 2008. In Philadelphia, Saul Ewing, a much smaller firm, reduced hiring of young law graduates by approximately two-thirds. Throughout 2009, attorneys and their clients dramatically reduced work in such areas as real estate mergers and acquisitions, public offerings, and numerous other areas of legal practice. Aside from attorney layoffs and cutbacks in hiring, starting dates were deferred for many young law graduates who had already been hired. In addition, summer internships were reduced or eliminated. Some currently unemployed young lawyers who secured positions in law firms upon graduation from law school have expressed interest in results of a proposed new survey to show the numbers of law graduates still employed five years after graduation. At the same time, because of increasing complaints, the American Bar Association is considering revising its survey questions to obtain more realistic and helpful statistics for future “U.S. News” annual law school rankings.

The Future

One good sign is that a number of law firms, including large corporate firms, are now experiencing a small, gradual upswing in hiring trends and figures. Also, many recent law graduates are optimistic about finding legal positions. In fact, some of these young attorneys have located and secured good positions in leading law firms.

Another encouraging sign in the legal staffing industry is that even amidst these difficult economic times, law school grads are still paying for assistance in completing résumés and legal employment applications, as well as for pre-interview coaching sessions. So maybe the Boy/Girl Scout motto of “Always Be Prepared” still carries clout—even in an uncertain economy. At least, with good preparation, recent law school graduates and others looking for work won’t be left speechless when that once-in-a-lifetime job offer comes along. Let’s just hope that ideal job keeps multiplying, exponentially, so that present and future graduated law students can find immediate, fulfilling and profitable legal employment.