America's law schools and firms

Graduates of American law schools are finding that their chosen career is less lucrative than they had hoped.

THIS year "The Apprentice", a television show in which contestants compete for the privilege of working for Donald Trump, features 16 who are down on their luck, having lost previous jobs or otherwise having to start anew. No fewer than five of them are lawyers. The legal-job market in America remains dire. But the numbers applying to law school are still soaring, and students are taking out ever bigger loans as tuition fees grow faster than lawyers' salaries. Increasingly, they are graduating into a world of overblown expectation and debt.

Between 1996 and 2008 private law schools' median tuition fees almost doubled, to just under $34,000 a year. At public law schools fees grew even faster, albeit from a lower base: for those going to schools in their home state they almost trebled, taking the median to around $16,000. Starting salaries at the biggest firms—those with more than 500 lawyers—roughly doubled, to $160,000. But such plum jobs are hard to get, especially for graduates of the less prestigious public schools. At smaller firms starting pay has for years failed to keep up with soaring tuition fees, and of late has fallen.

Graduates' chances in the job market have worsened since the "great purge" of 2009, when firms laid off young lawyers and withdrew job offers. The National Law Journal says that the 250 biggest firms cut their numbers of attorneys by 4% in 2009 and were projected to cut by another 1.1% in 2010, making for the worst two-year period in the 33 years of the journal's surveys.

Those that did not lay off any lawyers have frozen hiring and squeezed more work out of their staff. So morale is dismal at many firms. But it is worse among those recent graduates stuck in temporary or part-time posts or working in non-legal jobs. The grim market has given rise to a situations-vacant website, shitlawjobs.com, whose home-page banner reads: "You're a lawyer, the economy sucks and you need a job." Among its latest vacancies on November 10th was one for a Spanish-speaking lawyer, on just $10 an hour.

Law schools, of course, disagree that they offer students a bad deal. The statistics they produce, on measures such as how many ex-students are employed nine months after graduation, do not look so bad. But some frustrated young lawyers find them misleading. Some schools report as "employed" those in part-time or temporary jobs, ones that do not involve practising law and posts subsidised by the school itself.

Two students at Vanderbilt University's law school thus began the Law School Transparency project. Kyle McEntee, one of its founders, said Vanderbilt helpfully gave him the kind of detailed job-placement information all potential law students should have: where graduates were hired and how much they made. Mr McEntee asked all 200 of America's accredited schools to release the same data. Just one, the little-known Ave Maria School of Law in Florida, has agreed to do so. Ten others said they would consider the request.

The schools tell Mr McEntee that collecting the data is too expensive; he retorts that they already have most of them. Any privacy concerns could be dealt with by releasing aggregate figures that make it hard to discover individual graduates' salaries. The American Bar Association, which accredits the law schools, is also calling for greater openness on how graduates fare after leaving college.

The lousy job market is, of course, not the law schools' fault. The market is rigid. Firms tend to hire those who spent their second summer during law school at that firm, and thus begin interviewing students for these internships near the beginning of their second year. So, to a great extent, hiring decisions are made a couple of years before students graduate. This lag makes it harder to trim recruitment according to the economic weather.

But law schools could still do more to help their graduates prepare. Echoing a lament heard in pretty much every industry that hires graduates, Evan Chesler, the boss of Cravath, Swaine and Moore, a New York firm, decries "the difference between what law schools teach and what lawyers do". Law school, he says, focuses too much on teaching students to "think like a lawyer", rewarding independent study or working on the student law-review journal. He says they teach few of the practical skills of lawyering, leaving the firms to do much of the training in a recruit's first years on the job.

Richard Revesz, the dean of New York University's law school, replies that most firms' needs are so specific that law school should not be expected to provide them. But he is nonetheless trying to bring NYU's business and law schools together more often, so students learn to structure corporate deals as well as reading appellate decisions.

John Conroy, until last month the boss of Baker & McKenzie, the most globalised law firm, thinks England and Germany do better at helping graduates make the transition to becoming practising lawyers. A recent graduate spends two years combining work and study as a trainee solicitor in England and Referendar in Germany. The English system matches graduates to firms well, whereas the German system produces exceptional legal technicians, in Mr Conroy's view. In America, clients grumble that they are being billed at high rates for recent graduates who contribute little. "Clients shouldn't be paying for law firms to train people," is their refrain. Right now, many graduates wish they could get anybody to pay them for anything.

(Published by The Economist - November 11 ,2010)