Last week I had dinner with a friend who used to work at a large law firm and now has a non-legal career. I asked her what, if anything, she missed about life in Biglaw.
“Just one thing: the paycheck,” she said. “I miss being able to go crazy in the shoe department of Bloomingdale’s.”
It’s a common sentiment among people who leave jobs at large law firms (in terms of missing the paycheck; not sure about the shoes). Most people who leave large law firms, with the notable exception of finance folks, end up with lower incomes in their new lines of work. But many refugees of Biglaw report higher job satisfaction, as well as overall happiness.
An article in yesterday’s New York Times touched upon the trade-off between money and job satisfaction — and revealed a “magic number” of sorts, namely, the income level at which additional income does not bring you additional happiness….
According to a recent study in the Proceedings of the National Academy of Sciences, cited in the Times article, the magic number is $75,000 a year in household income. Once you hit that level, additional income “does nothing for happiness, enjoyment, sadness or stress.”
If $75,000 is in fact the “magic number,” this is very good news for lawyers. Many legal jobs outside of Biglaw — including some positions in midsize or small firm practice, in-house counsel posts, government legal jobs (especially federal), and judgeships (despite all the hand-wringing over judicial pay) — allow an attorney to earn $75,000 or more.
No article about the trade-off between money and job satisfaction would be complete without mention of a lawyer. The Times piece mentions a lawyer who left a high-paying job practicing law in order to take a more satisfying job teaching law. Teaching law is another example of a well-paying job open to holders of J.D. degrees: most tenure-track law professor jobs at ABA-accredited law schools pay more than $75K a year (although these jobs aren’t easy to get, given the academic credentials required).
Of course, although $75,000 may be the magic number for the general population, it might not be the magic number for lawyers. First, since lawyers have advanced degrees and specialized training, most of them can reasonably expect to earn more (even in this tough economy). Second, considering the educational debt loads that many lawyers carry, they may need more than $75,000 in order to live a “$75,000 lifestyle” (after subtracting the monthly student loan payments).
Third, lawyers will, for better or worse, compare themselves to other lawyers — and even though $75,000 is a good income for an average American, it is below the average for attorneys. From the Bureau of Labor Statistics:
In May 2008, the median annual wages of all wage-and-salaried lawyers were $110,590. The middle half of the occupation earned between $74,980 and $163,320. Median annual wages in the industries employing the largest numbers of lawyers in May 2008 were:
Management of companies and enterprises – $145,770
Federal Executive Branch – $126,080
Legal services – $116,550
Local government – $82,590
State government – $78,540
Salaries of experienced attorneys vary widely according to the type, size, and location of their employer. Lawyers who own their own practices usually earn less than those who are partners in law firms. Lawyers starting their own practice may need to work part time in other occupations to supplement their income until their practice is well established.
Above the Law readers: What’s your “magic number”? Take our poll below.
P.S. The entire Times article is worth reading. Check it out here.
Job Satisfaction vs. a Big Paycheck [New York Times]