Labor Dept.: 50,100 New Lawyer Jobs by 2028, Turnover of 27 Percent

On September 4, 2019, the Bureau of Labor Statistics (BLS) released its employment projections for the next cycle, 2018-2028.

For 2018, the BLS’s Employment Projections program (EP program) estimates that there were 823,900 lawyer positions (as opposed to discrete lawyers) in the United States. This figure includes self-employed attorneys. In 2016, the EP program found 792,500 lawyer positions, so there has been some growth between the two years. According to the BLS’s Current Population Survey (CPS), in 2018, 1.199 million people worked as lawyers in the United States. The discrepancy between the CPS and the EP program has existed for some time. In their respective contexts, both figures are correct.

The BLS projects future employment trends in part to help job seekers evaluate career choices, and the projections play an outsized role in the BLS’s Occupational Outlook Handbook. Here is an illustration from various sources that converts the flows of law-school graduates and new lawyers into stocks that can be compared to BLS employment measures since the 1980s.

Click here to read more:

What the 2018-28 Data Show

Analyzing Table 1.10, between 2018 and 2028, the BLS estimates a total 457,000 net lawyer jobs will be created (45,700 in the mean-average year). Of those, 50,100 (11 percent) can be attributed to economic growth over the decade, reaching 874,000 lawyer jobs total in 2028 (just 6 percent growth). The amount of new job growth is significantly lower than the 2016-26 cycle (74,800). The remaining new lawyer jobs, 406,900, consist of “occupational separations,” which include 182,000 lawyers leaving the workforce and 225,000 lawyers transferring to different jobs. Like all other occupations, lawyers leaving the labor force may be retiring or temporarily exiting for personal reasons, and lawyers transferring to other occupations may be moving up or down the occupational ladder, e.g. judges or retail clerks.

In the last cycle, 2016-26, the BLS implemented its new methodology for estimating occupational replacements. The older projections used a “cohort-component” methodology that netted out the differences among workers in five-year age brackets. For example, if in 2016 there were 50,000 lawyers in the 56-65 age cohort, and 60,000 lawyers in the 46-55 age cohort, then it would project that the difference, 10,000 lawyers, would leave the occupation and would require replacement by 2026. Add together the differences among all the age cohorts, and one has the net replacement rate.

The BLS abandoned this methodology because it suffered from sampling errors for small age cohorts and assumed that the only workers who needed replacement were older workers. To replace it, the BLS adopted an “occupational separations” methodology, which uses historical data on workers who have left the occupation, identifies common characteristics among them, regresses those characteristics, generates a probability of separation for the whole occupation, and then applies that to the occupation. Consequently, the EP program now detects lawyers who change occupations before middle age. While the results give a higher number of annual job openings than before—especially as compared to the number of new law-school graduates or bar admits—they also indicate a substantial amount of turnover in the legal profession: 225,000 out of the base 823,900 (27 percent) lawyer jobs.

Here is the BLS’s most-recent link for discussing occupational separations and its new methodology.

‘Strong Competition’ Continues

As with last cycle, the BLS published its biennial Occupations Outlook Handbook (OOH) along with the new employment projections. I’ve tracked its statements about job prospects for the legal profession going back to the 1990s. It’s always been negative, and the methodology change hasn’t affected this. I’ll print the text in full.

Despite the projected growth in new jobs for lawyers, competition for jobs should continue to be strong because more students are graduating from law school each year than there are jobs available. According to the American Bar Association’s National Lawyer Population Survey, a compilation of data collected by state bar associations or licensing agencies, there were over 1.3 million resident and active attorneys as of December 2016. Some law school graduates who have been unable to find permanent positions turn to temporary staffing firms that place attorneys in short-term jobs. These firms allow companies to hire lawyers as needed and permit beginning lawyers to develop practical experience. Many other law school graduates and licensed lawyers end up finding work in other occupations or industries due to the difficulty in finding jobs with traditional legal employers.

Because of the strong competition, a law school graduate’s willingness to relocate and his or her practical experiences are becoming more important. However, to be licensed in another state, a lawyer may have to take an additional state bar examination.

While many new lawyers are hired each year by law firms, this does not guarantee stable employment in the profession.  Newly hired lawyers, known as associates, must either advance within their firm or may be forced to leave, a practice commonly known as “up or out.” Those who leave law firms may find work as in-house counsel with companies, with government agencies, or as self-employed lawyers.

Editorial

As for the projections themselves, I’m struck by the variation from last cycle and the prior one (2014-24). The number of projected net new jobs went from 43,800 to 74,800 and now down to 50,100. Not much has changed in the economy from two or four years ago—it’s the longest sustained expansion in recent history, remember?—so I’m curious about the basis for the fluctuating employment projections. Tariffs? Inverted yield curves?

Out of curiosity I looked at what the BLS predicted for 2018 back in 2009. According to the 2008-18 projections, there should have been 857,700 lawyers, so the BLS was high by 4 percent, which is pretty good if you think about it. However, that just makes the EP program’s statements about “strong competition” in the legal profession more credible: If the Labor Department is accurate about the number of new lawyers in the future, then it might be right about the turnover rate.

Turnover, though, is the central topic that prospective students should be considering when it comes to choosing to attend law school, especially because the EP program’s methodology stymies comparisons between new graduates or bar admits on one hand and net new job openings on the other. No one, be it the BLS or the ABA, tracks the number of lawyers beginning or returning to legal careers long after finishing law school or receiving law licenses. By including these kinds of jobs, it’s possible that law-school employment data will indicate better long-term career outcomes than the profession actually provides. Some occupations that law-school graduates transition to may fully utilize their skills, but many are probably redundant to training they could’ve obtained from elsewhere for less, if at all.

My comprehensive explanation of the various measures of law-school grads and lawyers can be found on this page (updated!). It also should contain any links I may have omitted in this post.

Last time, I evaluated the BLS’s separations methodology by comparing lawyers to occupations requiring similar levels of education. I won’t do that again now because I don’t think there’s anything new to learn from it. For this reason, though, readers may want to look at the 2016-26 entry to see my thoughts on that at the time. Speaking of which…

Past Coverage

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