NALP13: Entry Level Associates Need Not Apply

NALP numbers show the grim reality of new hiring and starting salaries.

The National Association for Law Placement (NALP) has new numbers on the legal job market for recent graduates, and like it has been every year since the start of the Great Recession, those numbers are a horror show. A freaking horror show. They might as well put three recent graduates in a room with one job offer in it, handcuff the graduates to a pole, and give the offer to the one that eats through his arm first.

The other two would then get to leave the room unemployed, with some bite wounds, instead of unemployed with over $100,000 in debt, which is how people are actually leaving law school.

Do you want some good news? The lateral hiring market is hot. NALP executive director Jim Leipold called it a “feeding frenzy” for experienced associates. So if you got a job and held onto it through the 2009 layoffs, pick up your phone. It’s probably a recruiter calling. Congratulations on all your success.

If instead you were not lucky enough to be born five years earlier and have just graduated or are about to graduate, I don’t have anything for you — other than this here hacksaw. Chop, chop….

The most simple statistical description of the entry level hiring market is this: HALF of the class of 2011 that found work took a job paying $60,000 or less. That’s seven years of higher education, hundreds of thousands of dollars borrowed or paid out of pocket, untold opportunity costs, all to make somewhere around what a sanitation worker in New York City takes home. That’s not a bad deal, it’s an atrocious deal.

The problem is that Biglaw, with its high starting salaries, is simply not hiring anywhere close to pre-recession levels, and probably won’t ever again. One of the most telling statistics was that of the people who got legal jobs out of the class of 2011, only 49.5% of them were in private practice. That’s down from 55.5% in 2007. That dip might not sound like a lot, but consider that the percent of new hires working in private practice hadn’t dipped below 55% in 30 years.

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And that’s just the people who HAVE jobs. There are many who don’t — just over 12% according to the latest figures (up from around 5% in 2007). Leipold says that we lost 60,000 jobs throughout the recession and have only recovered 10,000 of them. But even that doesn’t represent a steady recovery. All the trend lines are flat, and hiring has plateaued the last couple of years into this “new normal.” 2007 is gone and it’s never, ever coming back.

What is out there? Well, you can work for your law school. Around five percent of employed graduates are funded by their law school. But even these so-called “bridge to practice” programs don’t tell the full story of law school’s desperate efforts to prop up the employment market. Approximately three percent of grads are employed in “academia,” up from almost 2% in 2007, but much of that variance is law schools employing grads as research assistants. Good luck making tenure from that starting position.

Hiring in the “business” sector is up, but don’t be fooled. While some companies are hiring the occasional person right out of school to build up their internal abilities, the way NALP counts “business” includes a load of contract attorneys — people who are technically paid by their agency, not the law firm they doc monkey for, so technically these contractors are employed in “business.”

And then there are the six percent of graduates who are “employed” as small or solo practitioners. They’ve hung out a shingle… but who knows how long it’ll be before they turn a profit.

So when NALP says that only 85.6% of class of 2011 graduates are employed nine months after graduation, already the lowest number since they began tracking, consider that some of those in the 85% are working as solos, contract attorneys, research assistants, and “other non-professional” positions, which I assume to mean “hookers.”

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No, class of 2012, things are not any better for you. NALP doesn’t have final numbers on the class of 2012 just yet, but early returns suggest no significant change. Leipold says that the number of 2012 grads in long-term, full-time positions requiring bar passage is up by 1.3%. BUT 2012 grads who are unemployed and seeking work are also up by 1.4%.

Leipold also doesn’t expect things to get better for the about to graduate class of 2013. Sorry fellas.

In fact, I asked Leipold, in light of the cratering of law school applications, if things would at least be better in 2016 or 2017. Many, like Case Western Dean Lawrence Mitchell, have suggested that now is a great time to go to law school.

Leipold seemed less optimistic. While he acknowledged that any reduction in the number of graduates would have a positive effect on the job opportunities for those who still go to law school, he added:

But there are new law schools in the [accreditation] pipeline. And every time you have a new law school, it more than offsets the shrinkages.

Opening a new law school in this environment is like setting fire to your house, wrestling a homeless man for his change, inadvertently knocking that change into the sewer, then turning to the homeless man and saying, “Looks like you and I are in the same boat.”

Leipold said that we are in the middle, not the end, of a great sea change. We don’t yet know what the world is going to look like on the other side. He imagines that when we come out of this, we’ll emerge with a variety of legal education — some traditional, some inexpensive and quick. He thinks legal employers will hire more and more “non-partner track” associates and outsource what they can.

I think… I’ve never been a big fan of horror movies.