Forget Law School: The US Job Market is Oversaturated with Lawyers

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In 2017, Whittier Law School closed its doors permanently, shocking law students and faculty members as the first accredited law school to shut down. And with fewer law graduates, fewer jobs, and more automated legal services, its closing serves as a warning to present law students and those who want to enter law school: the job market for lawyers is already bad, and thanks to technology, it’s only going to get worse.

As early as January 2014, job market analysts and law professionals have seen the oversaturation of lawyers into the job market. And as more non-rated and poorly rated schools are closing in 2018, it may be that the only way one can become a successful lawyer in this market is to make their way into the leagues of Harvard, Yale, and Stanford Law.

Job Market Decline Since 2010

The law profession has always been a prestigious career that many see as a lucrative option. Many expect that each new batch of lawyers could easily find jobs in the thousands of law firms across the country. However, that hasn’t been true since the fresh graduate lawyers of 2010.

Due to the recession, over ten percent of the class were still unemployed. Compared to the class of 2000, that also graduated during a recession, the earlier class seemed to perform better in terms of job hunting. And those lawyers stuck in unemployment found themselves with over $100,000 in law school debt.

In 2015, it appeared that only 75.1 percent of the class of 2010 in Ohio are practicing law, way below what the class of 2000 managed to attain in less than a year. The rates are also much lower than what the class of 2000 managed after three years: At that point, around 83 percent of the class of 2000 were already practicing law.

Given the low number of lawyers finding employment, the class of 2010 resorted to finding other jobs outside the legal profession. Many had turned to a career as full-time or substitute teachers, firefighters, party planners, salespeople, pest control technicians, and even tennis instructors. Almost 10 percent of lawyers claimed they had a “solo practice,” but given the difficulty of new lawyers running their own practice, it was possible that this was another term for unemployment or finding few clients to work with.

This is only data taken from Ohio lawyers who graduated in 2010 but given that the change in the law profession applies to the rest of the United States, it is possible that the labor market’s status also extends to other states. Since then, it is possible that many lawyers have resorted to other jobs that pay less than the average salary of a lawyer in order to make ends meet and pay off debts.

How Are There Too Many Lawyers?

Given the difficulty, intensity, and high cost of becoming a lawyer, it seems almost impossible to an everyday person that too many people have passed these hurdles that it has no longer become a profitable career option. But it’s possible, according to recent statistics.

As of 2017, there are around 1.3 million licensed and practicing attorneys in the United States, which roughly translates to one lawyer for every 244 Americans. The number of lawyers is enough to create the ninth most populated city in the United States, and it’s only going to keep growing, with the rate of new lawyers against the slower rate of older lawyers retiring from the industry.

And with regards to the education lawyers must go through, let’s compare the number of doctors produced by medical schools compared to the lawyers from law schools. There are 809,000 licensed medical doctors currently operating in the United States. That’s fewer doctors, meaning that’s one doctor for every 400 patients. That’s a bigger proportion and given that a regular person is more likely to get injured than to sue for an injury, it’s safer to assume that a doctor will always have patients. However, the number of lawyers to citizens is disproportionate considering fewer people need their services.

This is why the market has too many lawyers: because there are not enough people who will need legal services. And because many lawyers who study law with the intention of making money start to accumulate, eventually it’s no longer a profitable career, but a career filled with people looking to profit. And there’s only so many lawyers a firm can take before it stops becoming profitable, which is what is currently happening in the workforce.

Effect on the Workforce

According to consultancy firm Altman Weil’s reports, many law firm managers believe they have too many lawyers to the point that lawyers are not busy enough to be making a profit as high as before. In a poll with 320 managing partners and chairmen, 60 percent claimed that their overcapacity was making their firms less profitable. In large firms with over 250 attorneys, 74 percent of partners claimed that their attorneys’ inactivity was hurting profit.

It seems that corporations and businesses are also opting less on hiring law firms (who must charge more to keep their overloaded ship afloat) and more on hiring their own in-house team to focus on their business, according to the surveyed partners.

A Sign of Things to Come?

As the trends and declining profitability continue to plague the law profession, experts say more law schools, like Whittier, could start to close as the market has too many lawyers on hand. While lawyers from elite schools such as Harvard, Yale, and Stanford might always find job security and financial success with their school names undeniably boosting their worth, those who come from relatively unknown law schools or schools with poor reputations may struggle in their profession. Even lawyers from well-known law schools may start to feel the burn of the job market with fewer job openings available. According to Michael Horn of the business think tank Clayton Christensen, Whittier’s closing is not an isolated case, and more law schools can expect to close.

It may appear that the market is simply a competitive one, but comparing 2015 lawyers’ prospects to 2007, it appears the latter had done better by five points at approximately 91 percent, according to the National Association for Law Placement. And in 2014, there were 3,000 more lawyers that found work.

It’s possible that the surplus of lawyers may be connected to the growing trend of fewer people needing legal services. In 2015, states started to license “legal technicians,” who could advise clients in certain legal disciplines but could not represent them in court. Thereby, both a law graduate who passed the bar and a law drop-out who could pass the licensure exam but did not pass the bar could both legally offer clients advice.

There’s also the growing trend of technology slowly replacing human lawyers in small legal services. Startups such as LegalZoom and LawDingo are matching clients with lawyers, reducing the need for people to go elsewhere for legal help. Like in many industries, technology is reducing the amount of work humans need to perform. As a result, fewer people are needed in the legal field.

According to Andrew M. Perlman, the dean of Suffolk University Law, while technology will not make lawyers obsolete, it will significantly decrease the number of opportunities available to new lawyers.

Conclusion: Should You Become a Lawyer?

Like many industries, the law profession is changing with the advent of modern technology. While this promises innovation and convenience for the consumers and clients in need of legal aid, this spells saturation in the job market and fewer opportunities available for future bar passers.

My advice to the young high school and college graduates with their eyes set on law school? Skip it until the saturation clears itself when more lawyers start retiring and firms open its doors. Until then, you’re better off providing advice as legal technicians – or something outside the law profession entirely.

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