Ivey Files

September 24, 2007

Feast or Famine for Law School Grads

Readers of the Ivey Files and also my book (The Ivey Guide to Law School Admissions) know that I've been discouraging people from attending all but the top law schools in the country [updated to clarify: AT FULL PRICE], mainly because of simple math. As I wrote in The Ivey Guide:

You need to think of your legal education as an investment, and you should calculate your expected return on that investment. That's why it's so important to think about your career options coming out of various schools. If you have to pay $1,000 a month in after-tax dollars to cover your student loans, you'd better be sure you will be able to find work at a well-paying law firm after you graduate. If you graduate $100,000 in the hole, don't assume for as second you can run off and work for a public-interest legal clinic. And until you've paid off your debt, or unless you attend a law school with a generous loan-forgiveness program..., you won't have the freedom to go sit on a beach and stare at your belly button while you contemplate what you really want to do with your life. Think of it this way: Lots of people rush off to law school on the assumption that a law degree gives them freedom, but you don't really have freedom when you've mortgaged the next ten -- or thirty -- years of your life. (Law school graduates who join big firms don't have much trouble repaying their loans on the ten-year payment plan, but most law school graduates don't end up joining big firms, and many end up extending their loan-repayment schedules to thirty years.)

...

The top fifteen [law schools] also offer a level of job security that other law schools can't. People at the top schools who find themselves in the middle of the pack or even below still do just fine on the job market, even at the highest levels of the job market. The further down the food chain you go, though, the less of a safety net you have. Once you get to the second tier and below, you need to be at or near the top of your class to end up at a top firm in your region or with a top judge in your region (the national market is a much more difficult proposition), and people in the bottom half of the class often face grim hiring prospects.

Law school applicants fight me on this all the time, but I stick to my guns. Most ABA-approved law schools are not worth the investment. It's painful for people to hear, and most insist on learning this truth the hard way.

Now comes an article in today's Wall Street Journal, front page and above-the-fold no less, making the same argument:

A law degree isn't necessarily a license to print money these days. For graduates of elite law schools, prospects have never been better. Big law firms this year boosted their starting salaries to as high as $160,000. But the majority of law-school graduates are suffering from a supply-and-demand imbalance that's suppressing pay and job growth. The result: Graduates who don't score at the top of their class are struggling to find well-paying jobs to make payments on law-school debts that can exceed $100,000. Some are taking temporary contract work, reviewing documents for as little as $20 an hour, without benefits. And many are blaming their law schools for failing to warn them about the dark side of the job market.

The article gives some harrowing examples (all bullets in this posting are verbatim):

  • The law degree that Scott Bullock gained in 2005 from Seton Hall University -- where he says he ranked in the top third of his class -- is a "waste," he says. Some former high-school friends are earning considerably more as plumbers and electricians than the $50,000-a-year Mr. Bullock is making as a personal-injury attorney in Manhattan. To boot, he is paying off $118,000 in law-school debt.
  • A 2005 graduate of Brooklyn Law School, [Israel Meth] earns about $30 an hour as a contract attorney reviewing legal documents for big firms. He says he uses 60% of his paycheck to pay off student loans -- $100,000 for law school on top of $100,000 for the bachelor's degree he received from Columbia University.
  • Sue Clark... this year received her degree from second-tier Chicago-Kent College of Law, one of six law schools in the Chicago area. Despite graduating near the top half of her class, she has been unable to find a job and is doing temp work "essentially as a paralegal," she says. "A lot of people, including myself, feel frustrated about the lack of jobs," she says.
  • Mike Altmann, 29, a graduate of New York University who went to Brooklyn Law School, says he accumulated $130,000 in student-loan debt and graduated in 2002 with no meaningful employment opportunities -- one offer was a $33,000 job with no benefits. So Mr. Altmann became a contract attorney, reviewing electronic documents for big firms for around $20 to $30 an hour, and hasn't been able to find higher-paying work since.
  • Matthew Fox Curl graduated in 2004 from second-tier University of Houston in the bottom quarter of his class. After months of job hunting, he took his first job working for a sole practitioner focused on personal injury in the Houston area and made $32,000 in his first year. He quickly found that tort-reform legislation has been "brutal" to Texas plaintiffs' lawyers and last year left the firm to open up his own criminal-defense private practice. He's making less money than at his last job and has thought about moving back to his parents' house. "I didn't think three years out I'd be uninsured, thinking it's a great day when a crackhead brings me $500.

Are there some law schools that are honest about their graduates' job prospects? Refreshingly, yes:

  • Many students "simply cannot earn enough income after graduation to support the debt they incur," wrote Richard Matasar, dean of New York Law School, in 2005, concluding that, "We may be reaching the end of a golden era for law schools."
  • The University of Richmond School of Law in the last couple of years started to be more open about its employment statistics; it now breaks out how many of its grads work as contract attorneys. Of 57 2006 graduates working in private practice, for example, seven were contract employees nine months after graduation. Schools "should be sharing more information than they are now," says Joshua Burstein, associate dean for career services who put the changes in place. "Most people graduating from law school," he says, "are not going to be earning big salaries."

More typical are the dodgy (and some would argue fraudulent) recruiting practices of many law schools. As the article points out, "students entering law school have little way of knowing how tight a job market they might face. The only employment data that many prospective students see comes from school-promoted surveys that provide a far-from-complete portrait of graduate experiences." Examples:

  • Tulane University... reports to U.S. News & World Report magazine, which publishes widely watched annual law-school rankings, that its law-school graduates entering the job market in 2005 had a median salary of $135,000. But that is based on a survey that only 24% of that year's graduates completed, and those who did so likely represent the cream of the class, a Tulane official concedes. On its Web site, the school currently reports an average starting salary of $96,356 for graduates in private practice but doesn't include what percentage of graduates reported salaries for the survey.
  • A glossy admissions brochure for Brooklyn Law School, considered second-tier, reports a median salary for recent graduates at law firms of well above $100,000. But that figure doesn't reflect all incomes of graduates at firms; fewer than half of graduates at firms responded to the survey, the school reported to U.S. News. On its Web site, the school reports that 41% of last year's graduates work for firms of more than 100 lawyers, but it fails to mention that that percentage includes temporary attorneys, often working for hourly wages without benefits, Joan King, director of the school's career center, concedes. Ms. King says she believes the figures for her school accurately represent the broader graduating class. She says the number of contract attorneys is "minimal" but declined to give a number.

Declined to give a number? When annual tuition for full-time students at Brooklyn hovers around $40,000 before expenses (which tack on another $20,000)? That says it all. If these were for-profit companies trying to raise funds from clueless investors and publishing questionable data in their prospectuses, the SEC would be all over them. Universities get away with a lot, so buyer beware.

And note that the US News rankings do not provide information you can necessarily rely on. Their data is self-reported by the schools, and schools have huge incentives to fudge the numbers.

Finally, note that tuition and expenses are about the same to attend Brooklyn Law School as to attend Columbia Law School, even though graduates face wildly different job and income prospects during law school and afterwards. It is simply not rational to pay Columbia-level tuition to attend Brooklyn Law School. That's just one example, but you get my point.

Udate: here.

Former Dean of Admissions at the University of Chicago Law School and a recovering lawyer, Anna Ivey founded Ivey Consulting to help college, law school, and MBA applicants navigate the admissions process. Read more admissions tips in The Ivey Guide to Law School Admissions, recently updated and available as an e-book. Follow Anna on Twitter (@annaivey).

While your position that potential law students should do a cost-benefit analysis is on point, those who know they want to practice law should not be dissuaded from law school. What disturbs me is you negate the option of solo practice; more than 50% of all private practice attorneys are solos and do just fine.

Going to law school is not always about 'getting a job' or being an employee with the fattest paycheck. It is very much about creating a professional and personal life which quite often comes with that fat paycheck.

On the other hand, there are many people who sincerely regret having gone to law school. Some of us would be THRILLED to get on with a DAs office making 60K. But many want you to volunteer for months before granting an interview. If you made the mistake of going to a private law school, your loan payments are on par with rent in a pricy town.

Sure, I went to law school to "make a difference." But after three years of un- or underderemployment, the economics become MUCH more important.

The elitist tone of these entries is disturbing. I have been a Deputy District Attorney in LA county since 1979 and went to Southwestern Law School. We hire people from second and third tier schools as well as top tier schools. I have loved this job from day one and made a solid living at it, while raising three kids. the job satisfaction level among attorneys I know in the DAs office and PD's office is very high. Our starting wages are not spectacular-we start DDAs at 60k but I have had the opportunity to do over 50 felony trials. including murder cases and written appellate briefs for the California Appellate Courts as well as the US Supreme Court. My investment in a third tier law school was the best I ever made.

As a contract attorney, I am sure some earn that kind of wage--the unlicensed attorney or attorney not licensed in the state where he/she is working--but in DC, the rates are much higher than that and contract attorneys who are not completely incompetent and who are licensed appropriately tend to earn between 75-110k per year. So, while this is not the 160k salary, it is reasonable for a young attorney. Moreover, as far as benefits go, there is only ONE major player in the contract attorney world in DC that doesn't offer benefits. This is a myth. The TRUTH is that most contract attorneys don't want to pay their premiums OR hop from agency to agency/firm to firm like they are starving immigrants fresh off a boat to the extent that they don't take advantage of the benefit programs, many of which actually include BONUSES for hours worked. Personally, I work as a contract attorney and earn a reasonable income in the range of 90-110k from that work. And, I am also developing a private practice. And, NO, I am not confined to roach-filled basements and I do NOT work 100 hrs per week. People need to stop whining. The law is a PROFESSION. This means that you need to be prepard to develop a client base. The REAL problem is that people go to law school because they can't find a job and don't want to have to "sell" anything. Then, they expect law school to answer the prayer of a fat paycheck where they don't have to sell their services or their product. What people need is indeed counseling. But, the counseling should not be that law school is a waste. The counseling should be that law is both a profession and a business, and you should be well prepared in BOTH of those aspects by the time you finish. As for law schools and debt...again, if students knew anything about business, they would know a PUFF when they see or smell one. I went to a fourth-tiered law school for FREE rather than a 2nd tier one at top tier prices. I couldn't rationalize that investment. The bottom line is simple---stop going to law school in order to avoid the realities of a capitalist economy. Get a job at the mall and get over it.

I guess I just don't know why people who aren't going to great schools and aren't ranking highly in those schools are SUPRISED that jobs aren't available. I just don't know who goes around thinking "o if i'm in the bottom quarter of my class i'll get a job." Undergrad should have taught you better.

I don't know, it makes sense: low-achievers don't get jobs. duh.

"Some former high-school friends are earning considerably more as plumbers and electricians than the $50,000-a-year Mr. Bullock is making as a personal-injury attorney in Manhattan." --Speaking as an industrial electrician, I have to say we deserve every penny of it.

Where was this post in 1997?

yojoe

I think many more prospective law school applicants need to hear this message.

I am sorry, but what sort of idiot who graduated from Columbia of all places ends up at Brooklyn Law?

Ok, but what if one gets a full scholarship to a third-tier school? Should someone sign up to be 100,000+ in debt to attend a top tier law school when they can attend a third tier school for free?

Thanks!

@MsDickerson:

That depends entirely on what your career goals are, which is why it's so important to have figured out *why* you're going to law school before you decide where to go and what to borrow, rather than thinking you'll just figure it out once you get there. (I'm using "you" in the generic sense, not talking about you specifically.)

Here's one scenario: If you want to be a local prosecutor, you don't have to go to Stanford to do that, and financially it might make more sense to choose a third tier school with a full ride (since local prosecutors, even in expensive cities, make a whole lot less than six figures) than to pay full fare at a T14. See here for a post on public sector salaries as well as salary distribution curves for new lawyers more generally, and #3 here about the importance of weighing these factors before you say yes or no to a particular law school.

Here's another scenario: If you need to be starting your legal career earning six figures in order to carry your educational debt burden, I wouldn't go to anything but a T14 law school, where your access to six-figure BigLaw starting salaries is going to be widest. That's not me being a snob about the quality of education you'll get there; that's just financial risk analysis.