Students decide to attend law school because:
A) The LSAT entrance test is more fun than a video game
B) Law school itself consists mostly of parties with few academic demands
C) They want to become lawyers
Yes, our research conclusively supports Option C!
So, how is the job market for entry-level hiring of JDs? Of the 46,800 law school grads in the class of 2013, 45,600 reported their job status to NALP, the National Association for Law Placement, which advises law students and lawyers, and gathers and reports law school data: 37,700 are employed. Let’s take a look at those who joined private practice, representing over 50% of the total (19,300).
The Jobs Outlook
There are some indications that entry-level hiring of law school graduates is on the rise. NALP reported that new grads from the Class of 2013 found more jobs for the second consecutive year. Still, hiring has not recovered to the level of pre-recession hires; the sheer number of recent graduates hired at firms with over 500 lawyers is at a 4-year high (at 3,980), but is still well below 2009’s totals exceeding 5,000.
Keep in mind, however, that the graduating class of 2013 was the largest to date. According to James Leipold, Executive Director of NALP, “Even though there were more jobs and more of those jobs were higher-quality jobs, the overall unemployment rate continued to grow, just because the size of the pool was so big.” So while the employment rate has dropped from a 25-year high of 91.9% in 2007 to 84.5% for the Class of 2013, these figures must be viewed within the context of the recent bulge in the size of the law school classes.
The good news though, is that the next four classes have dropped from 52,000 students entering law school in 2010 to 37,000 students matriculating in the fall of 2014, a trend that is expected to improve job prospects.
Shift from Large to Small Firms
Since the 2008 recession. there has been a sizeable shift in hiring, from large firms to small firms. Three-quarters of law school grads have chosen to work at very small firms (2-10 lawyers) or large firms (over 100 lawyers) from 2008 to the present, but there has been a 10% shift over this period. In 2008, 43% entered large firms and 33% entered the very small firms; whereas in 2013, these numbers reversed.
One reason is that given economic considerations, some larger firms would prefer that graduating JDs acquire experience at a smaller firm before training them at a high entry-level salary rate. James Shearin, Chairman of Pullman and Comley, one of Connecticut’s largest law firms, said that this is partially informed by the demands of clients. “There are certainly clients who say we won’t pay for first-year associates,” he said.
Salary is also a significant reason for this trend. Salaries tend to rise with the size of the firm, and firms with over 500 employees typically offer $160,000 at the entry level, compared with a mid-50% range of $42,000-$60,000 for the smallest size firm of 2-10 employees. Given the higher salary rates, large firms have been tightening their staff, and then hiring later if they needed. Smaller firms, because they pay less for entry-level grads, can afford to invest in more of them.
In response to the weaker economy, there’s a movement towards more efficient, cost-effective approaches. “The big law business model is stumbling,” according to Basha Rubin, who graduated from Yale Law in 2010 and is the co-founder and CEO of Priori, a company that brokers entrepreneurial lawyers and business owners. Her company seeks to enlist a growing group of entrepreneurial lawyers who want to perform legal work independently, without the resources and constraints of working for a law firm. Rubin states, “Previously disaggregated and fragmented, they can use technology to improve their efficiency with new tools that automate document production and assembly, workflow management research, and contract review.”
Influence of Summer Programs
Entry-level lawyers at large law firms are typically hired after participating in summer programs. In 2013, the average size of summer programs was 11, a decline from the peak of 14 in 2000.
There are, however, exceptions. WilmerHale, one of the top law firms in the US, hired 39 summer associates in 2013, slightly up from previous years. According to Boston Business Journal, Mark Fleming, chair of the firm’s hiring committee, felt that “this class size allows associates to rotate through many of the firm’s practice areas.”
Another piece of good news is that the percentage of 3Ls in the Class of 2013 who received job offers after participating in summer programs hit 91.6%, the highest of any year in the last two decades except for 92.8% in 2007.
So, if you love the idea of practicing law, there’s plenty of encouragement to do so! If you have any questions, contact Collegiate Gateway – as always, we’re happy to help!