Now That There Aren't As Many Law Students, Hiring Has Stabilized (NALP 2016)

That state of the legal hiring market is... fine?

Man on chartsWith pants singed from an ironing mishap and a wicked Boston hangover, I showed up at Executive Director Jim Leipold’s morning panel at the recent NALP conference on the state of the legal hiring market. I can therefore report that the legal hiring market has more or less stabilized. There aren’t more jobs, but fewer people are coming out of law schools so employment rates are up for those who graduate.

In 2007, the last good year on Earth, 68 percent of law grads received long-term, full-time, bar passage required jobs. Last year, 62 percent of graduates received such positions. Granted, law school enrollments are near record lows, but still, the news is that the market has corrected itself.

The employment rate is up. The real number of jobs obtained is down. These are the times we live in.

There was also some good news about the most important chart in legal education: the NALP bimodal salary distribution chart. Once again, it shows that most grads get jobs in the $45,000 – $65,000 range, with only a lucky few getting the Biglaw jobs that pay $160,000.

NALP DistributionCurve2014

This year, Leipold says that if you look really closely you’ll see a slight uptick in the amount of people making salaries in the “valley.” Those high-five-figures/low-six-figures jobs would be great for grads who can’t work in Biglaw but would still like to have a reasonable shot at loan repayment.

I say “can’t” because, as Leipold says, “in the aggregate, graduates will try to work for the biggest firm that will hire them.” Sure, an individual person might have a non-Biglaw preference, but writ large, most people most of the time will work for the firm that will pay them the most money. And the firms that pay the most tend to be the biggest.

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As it stands, the bimodal distribution shows that Biglaw is probably still paying too much for its new talent. The top 200 firms or so are bidding against themselves. If there is more movement toward “valley” salaries in the coming years, it could indicate a much bigger change in how we hire new lawyers.

The other trend of note was that the number of “bridge-to-practice” style, school-funded jobs has peaked and is on the retreat. These jobs, which Leipold indicated are now a clear effort by schools to manipulate their employment statistics for the U.S. News rankings, are expensive for schools. As schools are already facing intense budget pressure from the decline in law school applications, we can expect these positions to decrease further in the coming years.

Altogether, despite the personal bravery and heroism I exhibited to even make it to the panel (the Lateral Link party the night before was hopping), the legal hiring market is about as exciting as returning to a city one year after Godzilla stomped through it. There are still signs of damage, things have not yet been rebuilt, but the fires are out and a sense of normalcy has returned.

In broad strokes, the people who decided not to go to law school probably made the right choice. There weren’t going to be jobs for all of them. But the people who decided to go to law school, especially if they went to good schools in a cost-effective manner, also made non-ruinous choices.

The market has corrected. Thanks, Obama.

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Elie Mystal is an editor of danger and mystery at Above the Law. Follow him on Twitter @ElieNYC or Facebook for drunken shouting matches. And like our podcast: Thinking Like A Lawyer. Like it NOW so I can one day breathe free.