GUEST POST—Smokin’ Bucketful of Awesome (Flow Chart Edition)

(Connecticut attorney Samuel Browning, a friend of The Law School Tuition Bubble, obtained permission from law professor Bernie Burk to create a flow chart version of a series of posts Burk wrote on The Faculty Lounge in June 2014 that characterized law school outcomes as between either “A Smokin’ Bucketful of Awesome” or “A Smoking Pile of Scrap.” Mr. Browning’s chart appears here with only minor proofreading on my part, so any unclear points, variances from Burk’s posts, or errors are his own. Actual hyperlinks to Burk’s articles are included at the bottom. Click on the flow chart to enlarge it in your browser.)

Smokin' Bucketful of Awesome (Flow Chart)

********************

http://www.thefacultylounge.org/2014/06/more-thoughts-on-self-delusion-in-the-legal-academy-and-an-effort-to-engage-the-aals.html

http://www.thefacultylounge.org/2014/06/self-delusion-spreads-from-professional-to-graduate-education-consternation-curiously-absent.html

http://www.thefacultylounge.org/2014/06/still-more-thoughts-on-self-delusion-in-the-legal-academy-or-accepting-the-difference-between-a-smok.html

71 Percent of Lawyers Work in the Legal Services Sector

71 percent of employed lawyers, that is. We’re not talking about people who are on the rolls but aren’t working.

I haven’t carefully read through all of Michael Simkovic’s and Frank McIntyre’s most recent analysis in law graduate earnings, but it looks like they’re still uninterested in exploring the possibility that law grads’ earnings are attributable to demand-side factors, like price or income elasticity of demand for lawyers’ services. Because they don’t show us that law students who complete all the required law school course work without graduating have the same earnings as law graduates, anything they say about a JD premium is premature. Such an analysis is crucial because one of their own citations, David Card’s 1999, “The Causal Effect of Education on Earnings,” indicates that law grads earn substantially more than the trend would suggest. This finding screams for testing, but Simkovic and McIntyre aren’t careful enough researchers to do that.

Thus, it follows that their comparisons between law grads and college grads in “Timing Law School” are equally inadmissible. Indeed, I may not bother commenting on “Timing” at length at all.

However, I did decide that a little procrastination is good for the human spirit (and entertaining to the reader), so I poked around “Timing” to see what errors I could find. I’ll showcase one.

On page 17 Simkovic and McIntyre write:

Based on initial outcomes for recent graduates and qualitative factors, Henderson and Zahorsky argue that the legal profession is experiencing a “structural shift” due to globalization and technological change.34 Others point to a decline in the size of “legal services” (law firms) relative to GDP.35 What this means for law school graduates is uncertain, since most legal services workers are not lawyers,36 and many law graduates work in fields other than legal services.37

Footnote 36 uses the Bureau of Labor Statistics’ Occupational Employment Statistics (OES) database to show that “out of more than 1.1 million legal services workers, only 375 thousand were lawyers. Other occupations include paralegals, secretaries, bookkeepers and computer support and business specialists.”

And footnote 37 says:

Around 60 percent of law graduates practice law. Simkovic and McIntyre, supra [“Economic Value of a Law Degree”] at 252. Of those working as lawyers, around 65 percent work in “legal services.” United States Department of Labor, Bureau of Labor Statistics, supra note 36. Some of the non-lawyers working in legal services have law degrees.

In other words, the authors bury in a footnote the fact that 65 percent of lawyers work in legal services, so they can claim that it’s unclear how economic swings affecting the legal services sector would in turn affect law grads because most workers there aren’t lawyers. Being mindful of the distinction between law grads and lawyers, it’s nevertheless pretty bizarre to believe that the one industry law school prepares people for most would have a trivial impact on their earnings. The only alternative interpretation is for Simkovic and McIntyre to show that the legal sector is laying off everyone but its lawyers—and admittedly (again, in a footnote) malemployed law grads.

The foregoing aside, their math is still incorrect. It’s true that 375,000 legal sector lawyers out of the 592,670 total in the OES equals 63 percent, but that’s not the full number of lawyers. Why? Because the OES omits self-employed workers, which feature prominently in the legal profession. This is an pitfall that I either first noticed or was pointed out to me when I started writing on law schools nearly five years ago, so it’s amusing to see Simkovic and McIntyre make it.

In 2012, the BLS’s Employment Projections program found 759,800 employed lawyers, of which 374,900 were legal sector wage-and-salary employees. According to the BLS’s estimate of the distribution of lawyers among industries (xls), 165,700 lawyers were self-employed workers. It’s just about impossible for these folks to not be working in the legal sector, and indeed, if one looks at the Bureau of Economic Analysis’ National Income and Product Accounts tables, one finds that self-employed workers are included in the category “Persons Engaged in Production by Industry” (Table 6.8D).

As a result, 540,600 lawyers out of 759,800 lawyers—71 percent—work in the legal services sector, not 63 percent. These scant 8 percentage points sure make it look more persuasive to me that what goes on in the legal sector influences law grads’ earnings. (Oh, and I add that another 17 percent of all lawyers work in government. Is that sector robustly hiring lawyers?)

I don’t expect those 8 percentage points to persuade Simkovic and McIntyre, though. They’ve gotten plenty of mileage asking the legal profession to accept on an untested, pure human capital hypothesis that law school pays off even if the legal sector implodes. They can at least include self-employed lawyers in their adverse footnotes.

LSAT Tea-Leaf Reading: February 2015 Edition

BOUNCE!

No. LSAT Takers, 4-Testing Period Moving Sum

20,358 people took the LSAT in February, up 859 (4.4 percent) from 2014. Notably, that’s growth in two consecutive testing administrations. Wow indeed.

This ends our LSAT year with 101,689 total LSAT takers, which is a record low going back to 1986. Back in those days, you said you were listening to Springsteen’s Born in the U.S.A. or Heart’s eponymous album, but we all know couldn’t take Barbra Streisand’s The Broadway Album and the soundtracks to Miami Vice and Rocky IV out of your tape deck. (Cultured readers from my age bracket will recognize how Rocky IV‘s villain’s theme closely resembles that of Unicron’s from the Transformers movie of the same period: Both were crafted by Vince DiCola.)

Back to less exciting 2015, I think there’s a little room left for LSAT takers to drop, but applicants aren’t shying away from law school as they were in the past. They’re down a mere 7 percent from this time last year.

No. Applicants Over App Cycle

It’s unlikely they’ll weigh in at fewer than 50,000, so it looks like we’re pretty close to the bottom if we’re not there already. Who knows, though, maybe it’s just people thinking they could get into elite law schools.

For some perspective on the law school crunch, here’re the trends since the 1960s.

Enrollment, LSAT, & Application Data

The only unobvious insight I can give you from this chart is how amazing it is that peak LSAT in 2009-11 just did not translate into peak applicants. Much of it is due to non-first-time test-takers, but it’s a real harbinger for how things will look going forward. We may be at the applicant trough, but folks, they ain’t coming back.

GlaxoSmithKlineMitchellHamline

The only thing that should surprise anyone less than Hamline’s and William Mitchell’s merger should be their new name, Hamline|Mitchell [UPDATE: It’s actually Mitchell|Hamline. No idea why I got that wrong.], which sounds like a self-satisfied pharmaceutical company. In fact, Mitchell was the product of five law schools between 1900 and 1956. It’s like planetary accretion.

Personally, my money was on University of La Verne, which has still managed to stumble along, despite its superfluousness, but the biggest loser here is Slate‘s Jordan Weissmann who bet a mere $2.00 with UC-Berkeley’s Steven Davidoff Solomon that at least one law school would close or merge by 2018. Come on, everyone knew a law school would close or merge by 2018. Like, what were you thinking?? I swear, the best investment opportunities are squandered on the folks who can afford them.

The only real news of note is what we still don’t know. From the Star Tribune:

[Former Mitchell dean Eric] Janus acknowledged that combining the two schools will result in some cuts in faculty and staff. But he declined to speculate how many jobs may be lost, and said he hoped to avoid layoffs through voluntary attrition.

For reference: Fall 2014 [Hamline, Mitchell]:

  • Full-Time Faculty: 14, 26
  • Deans, librarians, and others who teach: 11, 13
  • Part-Time: 33, 191

The bad news for Minnesota’s legal market is former law profs competing for jobs—and I doubt their amazing experience as law profs will translate to partner offers.

Site Update 2015-02-09: Law Graduate Overproduction Page

The update can be found here. (The 2011 edition has been moved here.)

To keep the analysis consistent with previous years, I used the class of 2013 even though data for the class on 2014 are available (and logged by moi). It’s a little problematic given that 2013 was the law graduate high tide, but that’s what happens when law schools enroll people without regard to employment outcomes.

I do not discussed the BLS’s proposed changes to its methodology for measuring occupational replacements. Assuming it’s approved, then for future versions, if the BLS separates annual replacement openings between those created by workers who leave the labor force and workers who move to different occupations, then I’ll use the labor force rate as the measure for “sustainable jobs.” It’s imperfect, but the same can be said of the current methodology.

I’ve also updated the site’s highly popular lawyers per capita by state page to include employed lawyers per capita and idle attorneys using the 2012 employment data. I am waiting on the ABA to update its national lawyer counts for 2014 and 2015. (They do plan on doing that right?)

At this time, I will brag that the Census Bureau’s press relations department cited my work on this topic last August.

Japan Times Op-Ed Misdiagnoses U.S. Legal Education

Walt Gardner sends “Japanese and U.S. Law Schools at a Crossroads” to The Japan Times.

Regular readers should be familiar with my opinion on Japan’s failed, futile expansion of its legal education establishment: When criticized for over-emulating the U.S. law school system, it acquiesces when it should double-down on all the arguments their U.S. counterparts give.

But Gardner has his own opinions:

In the United States, the 200 American Bar Association’s accredited law schools are questioning whether too much emphasis is placed on the theoretical over the practical. Possession of a law degree does not necessarily mean graduates are ready to provide legal services, even though three-year tuition can exceed $150,000.

As a result, the number of applicants is down by more than 37 percent compared to 2010. The future is no brighter. According to the Bureau of Labor Statistics, there will be some 21,880 new jobs for lawyers by 2020 but more than 45,000 graduates by then.

The practical training thing has always been a red herring. What’s important is jobs. Taking Gardner’s numbers as true, we find that there are too many law graduates relative to the number of lawyer job openings. Being well-trained for jobs that don’t exist doesn’t create jobs.

Meditate on that wisdom, Grasshopper.

Gardner, for his part, recommends law schools in both countries “raise their standards to admit even far fewer students” and toughen bar exams.

In the U.S., it would seem, law schools are efficient charities that don’t waste student loans and will self-terminate rather than accept students who have little hope of entering the profession or passing the bar. I had no idea.

Incidentally, does anyone know where this “practical training solution” myth came from? I keep seeing it without any question, as though admitting that there is an oversupply problem will anger Zeus enough to chuck a thunderbolt at you.

Gardner concludes:

The Ministry of Education and Science, which has been accused of being too lax, in accrediting law schools, could take a page from the ABA … in order to protect the integrity of a law degree. Too much is at stake for the Ministry to sit idly by.

Indeed. Thanks to the ABA’s tough standards that Japan should emulate, there are barely 200 law schools scraping by to keep their accreditation. The deans’ nights are sleepless before ABA site visits, and they tremble and stammer whenever the Imperial Accreditors interrogate them about the most trivial infractions.

In the real world, I can only think of three law schools that have lost their accreditation or were denied it in the last few decades. The ABA resisted Western State’s bid because it was a for-profit; it rescinded La Verne’s accreditation because of its graduates’ low bar pass rate, and then reapproved it without explanation; and it denied Lincoln Memorial’s bid in late 2011 only to change its mind last summer.

But the problem isn’t that the standards are too lax, it’s that we don’t need postbaccalaureate legal education. Same goes for Japan, even though it has a different type of legal system. Jobs should come first, and mandatory training should be kept to a minimum. It doesn’t make for an interesting editorial, I guess.

On The American Lawyer: Applying to Top Law Schools Disserved Many in 2014

Applying to Top Law Schools Disserved Many in 2014.”

It really is one of the most unusual things I’ve seen in my few years writing on legal education. Like, where did these applicants get it into their heads that U.S. News‘ darlings were desperate? Hope they did well though.

Follow

Get every new post delivered to your Inbox.

Join 169 other followers