Balkinization  

Tuesday, June 28, 2011

The Coming Crunch for Law Schools

Brian Tamanaha

The New York Times released a chart yesterday showing that law schools are churning out far more lawyers than the number of available legal positions. That is old news, of course. What's worse is that the oversupply promises to continue. In 2010, Georgetown enrolled 591 first year JD students, Harvard enrolled 531, Fordham enrolled 477, and NYU enrolled 476. Large classes are not limited to top schools: New York Law School took in 641, John Marshall (Chicago) enrolled 539, and Suffolk enrolled 531. (Let's not talk about the 808 first year students taken by Florida Coastal and 1,583 by Cooley.) Law schools now pump out about 45,000 graduates annually at a time when the Bureau of Labor Statistics projects about 28,000 new lawyer positions per year.

Why are law schools enrolling so many students when employment prospects for graduates are so poor? Because they must. In the past two decades law faculties have gotten bigger. AALS tallied 7,421 full time faculty in 1990, and 10,965 in 2008. Some of this overall increase comes from newly accredited schools, but most of it is faculty expansion: student-faculty ratios have been cut almost by half during this period.

Bigger faculties must be paid for through some combination of more bodies (J.D. and LL.M) and higher tuition. Tuition already goes up every year as it is, so the number of revenue paying students cannot be reduced substantially. It's that basic. (Administrations have also gotten bigger, but I focus on faculties because faculty expenses typically comprise more than half of the total budget and are hard to trim owing to tenure and long term contracts.)

Law schools will soon suffer the consequences of this expansion. The chart below tracks the number of applicants against the number of first year students from 1990 to the present. As it shows, law schools exhibit a one-way ratchet: when applications drop, enrollment remains steady; when applications rise, enrollment goes up.


This pattern--explained by our need for revenue to fund our operation--portends tough times ahead for law schools.

In 1991, the number of law school applicants peaked at nearly 100,000, then fell every year until it reached a low of about 71,000 (in 1997), before turning up again. A second peak of 100,000 was reached in 2004, followed by another decline. (Notice in the chart that neither drop in applicants is matched by a drop in enrollment.) Law schools enjoyed a two year boost in applicants in 2009 and 2010 owing to the economic recession--with jobless graduates flocking to law schools hoping to improve their situation--but the number turned down again this past spring by eleven percent.

Here's where things get sticky. In the nineties law schools enrolled about 42 thousand students, which provided a margin of thirty thousand applicants at the low. This year the number of applicants was roughly 79,000, with law schools enrolling 51,000-plus students, leaving us at about the same margin of thirty thousand applicants over seats.

With tuition high and job prospects low, it seems likely that the number of law school applicants will continue to fall--although it's hard to say how far or for how long. One concrete indication of a continued drop is the google trend line for LSAT searches (check it out here), which shows a steady downward trajectory since the peak in 2004. (Tellingly, the applicant uptick in 2009 and 2010 barely disrupts the overall trend.)

If the drop in applicants continues, while enrollment stays up, schools will reach deeper in the pool to fill their classes, bringing in students with lower qualifications. A significant decline like this has happened before, in the early eighties and the nineties. The consequences for each school will depend upon its standing in the overall law school hierarchy and in the local legal market. But every school will feel it (although much less at the top). Schools would be prudent to anticipate a cumulative drop in applications of perhaps a third from their high. (Even if the reduction does not go that far, the number will be misleading because prospective students now apply to more schools than in the past.)

The 2010 acceptance numbers suggest that many law schools are already in a worrisome spot. That year, twenty schools accepted between 45% and 49% of the students who applied; twenty-two schools accepted between 50% and 59% of applicants; and seven schools has an acceptance rate of 60% or higher (Cooley was the highest at 83.3%). Added together, nearly a quarter of law schools in the country accepted close to half or more of their applicants—and this was before the latest decline in the number of applicants.

Law schools have enjoyed flush times for more than a decade. Tough times are ahead.

Comments:

Call me a glass half-full kind of guy, but it seems to me that with dumber lawyers, people are more likely to follow the law.
 

Are there too many lawyers? I thought so AFTER November of 1954 when I was admitted to practice in MA. I would check the new admissions twice each year and worry about the field being too crowded - until, of course, I had established a pretty good practice that served me well until my semi-retirement in 1998. If there are too many lawyers, why? My answer has been that going to law school gives one a good shot at grabbing the brass ring without too much heavy lifting, unlike, say, medical school.

I have noted before my love for Mel Lazarus' "Miss Peach" comic strip going back a few too many decades, especially the strip that adorned my office wall for several decades, with grade schhol student Arthur at the podium with the banner "Future Lawyers of America Meet Here" (or something like that) pronouncing that his goal in life was to "Sue every man, woman and child in America" (or something like that). Now that the Scalia-5 have condemned class actions in Wal Mart, alas, poor Arthur would have to do that piece meal, and how long might that take with a population of over 300 million. No class!

Also, as I have noted in the past, the most tuition I paid was in my third year of law school: $400.00. After all these years, it is obvious something is wrong. If there are too many lawyers, does this result in more litigation or unnecessary legal work? Does this mean, as mls seems to suggest, dumber lawyers? I'd like to hear more of mls' glass half-full hypothesis on this. Compare this to the medical profession: would dumber doctors result in people more likely to be healthy?

What I do note, as a glass half-empty kind of guy [not really, i'm just being a nudge early in the morning because I can't sleep], is that with too many lawyers there have not resulted better lawyer jokes.

Just as water seeks its own level (including in half-ful and half-empty glasses), perhaps the venerable "market" will in time straighten this all out for the legal, including academic, community. But my concern is for the students, too young perhaps to understand they may be treading water and are in need of financial floatation devices. I hear you, Brian, as I have in the past, sharing your concerns. The expression "Physician, heal thyself" may not work for lawyers.
 

@ mls. I couldn't have put it better myself. Hopefully, the rest will get what you said, as well.

This job insecurity is, however, painful especially for the people that follow law school out of passion, fighting for what they believe in.

Students freshly graduated and of the school's benches hit this wall: a field of work overcrowded, with not enough jobs and lowered salaries. They're without jobs and in debt, because of aiming for the jobs they've decided they'd be perfect for.

I've wanted to quit several times as well, but having set my standards high, reading about notable personalities like Karla Moskowitz, Elizabeth K Lee or Rolando T. Acosta, I knew that I should at least finish law school for myself.

Let's hope things will get better!

I'll deal with the job shortage in some other way, but I've decided I must finish what I've started either way.
 

I request that Professor Tamanaha ask Professor Lederman to open his posts for comments. Admittedly unrelated to the subject of this thread, except to the extent that dumber lawyers would not be able to re-define "torture" or "hostilities" as deftly as the very smart lawyers from OLC.
 

I feel Paulie's pain:

"They're without jobs and in debt, because of aiming for the jobs they've decided they'd be perfect for. "

but I wonder about their decision that they'd be "perfect" as lawyers. One can do well as an attorney or do good (or both?). Is the passion for the former or the latter? Perhaps the huge debt suggests the former. And that may be the underlying problem that Brian is trying to get at.

mls' screed on OLC might suggest to some how smart John Yoo was or to others how dumb he was and wonder how could newbies in OLC get any dumber. I don't know if Prof. Lederman will jump into the comment fray, but I'd still like to learn more of mls' hypothesis on dumber lawyers resulting from the current situation in law schools with the result that " ... people are more likely to follow the law." (Hopefully, it would not be lemming-like.)
 

Shag- just joking about the dumber lawyers. But I would like Professor Lederman to open up his posts for comments because I have a few things to say about the smarter lawyers.
 

Re the chart:

I'm probably missing something obvious, but could someone explain how we get more 1L enrollees than applicants in a given year?
 

Never mind, I get it.
 

Since the growth in law school populations following WW II, together with increases/changes in statutes/case law at both the federal and state levels, there have been issues of elitism versus egalitarianism. As long as the market for legal services could absorb this growth, such issues have not been seriously addressed. Now with the slowdown in legal demand presumably due to the economy, concerns of having too many lawyers gets to the forefront, requiring consideration of elitism versus egalitarianism. Perhaps normally high tuitions would curb the growth of excess lawyers. Unless something is done about such high tuitions, perhaps egalitarianism may suffer more than elitism. Once again there may be steps taken via bar exams, internships to avoid too much growth in new lawyers. But what should not be put at risk is the importance of providing lawyers qualified to deliver good legal services to clients, including the importance of lawyers serving as gatekeepers. So there must be a lot of soul searching in the legal academy, bar associations, practicing attorneys and law students. The practice of law should not be an elite bastion as it had been to a certain extent prior to WW II.

As to whether there are indeed too many lawyers, perhaps Brian can provide a chart demonstrating per capita increases in the number of lawyers going back to post-WW II. To a certain extent, new statutes/case law at the federal and state levels may have contributed to per capita increases but to what extent? Surely those clients with deep pockets can obtain well qualified legal beagles to deliver legal services. But what about those without deep pockets? Are they receiving shoddy legal services or going bare? So back to elitism versus egalitarianism.
 

Brian, to make matters worse, do yu know how many non-ABA-approved law schools exist in CA? Some of them even provide an online legal education!
 

Law schools are missing the boat in connection with teaching the skills now required for a law firm and its lawyers to succeed, as I noted at http://kowalskiandassociatesblog.com/2011/05/19/it-takes-a-village-to-build-a-successful-law-firm-fewer-residents-of-that-village-are-actually-lawyers/

Add to this calculus the fact that law firms no longer have a monopoly to provide legal services: http://kowalskiandassociatesblog.com/2011/06/21/grabbing-slices-of-the-diminishing-legal-spend-pie-legal-project-outsourcing-downsourcing-and-insourcing/

But, as I said earlier, with the demand for lawyers decreasing regularly, the anomaly of increasing enrollment, skyrocketing tuition and the creation of even more law schools is a by-product of the hype and hucksterism of law school academia, as David Seagall has covered so well in the Times. The blatant deceptive reporting by law schools of the employment results of graduates is an ignominious stain on the profession and borders on criminality, illegality and certainly is completely inconsistent with the high ethical standards the profession purports to profess. See more at http://kowalskiandassociatesblog.com/2010/07/25/what-if-they-built-a-new-law-school-and-nobody-came/

The failure by law schools to educate students in the new skills required in the market only adds to their ignominy.
 

This comment has been removed by the author.
 

Shag from Brookline requested data and a chart showing JD production. I have compiled some data from ABA statistics that go back to 1963 and calculated how much JD production occurred relative to the population. (I created and plotted a stat called "Sustained Inverse Lawyers Per Capita", which is a measure of the inverse lawyers per capita that could be sustained by JD production in a given year assuming that a lawyer's work life would last for about 40 years.) To see the data and the charts, visit this post at my blog:

40 Years of Lawyer Overproduction, a Data Table, and 2 Charts

The amount of JDs produced each year began increasing in the 1960s with a more dramatic increase in the 1970s.

Consequently, the current amount of JDs per capita is about 1 JD for every 215 people (only counting JDs produced over the past 40 years).

In 2009, the law schools produced enough new JDs to sustain having a lawyer-to-population ratio of 1 JD for every 174.4 people.

In David Segal's recent New York Times article he reported that according to the Law School Admission Council, 49,700 new JDs were minted (in either 2010 or 2011, I'm not sure which year). At that rate of JD production, in 40 years we would have almost 2 million JDs who would have graduated over the previous 40 years.
 

Here are some other blog posts of mine that may be of interest. I obtained ABA and Bureau of Labor Statistics stats which suggest that fewer than 54% of all JDs are employed in the legal profession:

Statistics suggest that only 53.8% of all lawyers are employed in the legal profession

It is also possible to construct a model showing that fewer than 30% of recent graduates are able to find work in the legal profession:

Statistics may suggest that less than 30% of new JDs were able to find work in the legal profession over the past 10 years.

It is also possible that at some point in the future we could end up having 2 million JDs produced in the previous 40 years:

2 million attorneys?

2 million attorneys? Not as far-fetched as it might seem.
 

I also noticed in the past, most studies I paid was in my third year of law school: $ 400.00. After all these years, it is clear that something is wrong. If there are too many lawyers does it lead to more lawsuits or unnecessary legal work? Does this suggest that MLS dumber lawyers? I want to hear more than a hypothesis MLS glass half full on this. Compare this with the medical profession: doctors would result in stupid people more likely to be healthy?
 

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The lawyers are too many? I thought so after November 1954, when I was taken into practice in MA. I would check the new admissions twice a year and a concern for the field is too crowded - until, of course, I made a pretty good practice, which has served me well until my semi-retirement in 1998. If there are too many lawyers, why? My answer is that going to law school to give a good shot to grab the brass ring without too much heavy lifting, as opposed to say, the Medical School.

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