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The dismal future for law graduates

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  • Mon, Feb 22, 2010 - 11:41pm

    #1

    George Karpouzis

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    The dismal future for law graduates

 

Recent law graduates are in a world of pain as they begin to realize that their degrees are not worth what they were told or taught they would be worth. Because of the constant media blitz, shows such as raising the bar, boston legal, and others, people believe that lawyers are a wealthy and prosperous bunch. Sadly, this is faar from the truth. Unless you went to a to 20 law school out of the 210 law schools, or unless you were top 10% of the rest of the law schools, you are in a deep hole. The other exception is if your family has their own firm which is successfull. However, if you fall in the “other” section which basically comprises the majority of law school graduates finding a job, and a decent paying job is very very difficult to do. Add in the seriously high debt service and it is near poverty for many of my peers.




OVERSUPPLY OF ATTORNEYS

Each and every year, law schools are pumping out over 45,000 grads. Here’s a clip from Forbes:

Law schools have been lying about their alumni employment data for quite some time. While many of these schools claims that the average starting salary starts in 70-90k  range, this is far from the truth. Take a look at the job offers from craigslist and you will see entry level attorneys being offered 15-20 dollars per hour.

In a new paper, “Mamas Don’t let Your Babies Grow Up to Be Lawyers” Vanderbilt University Professor Herbert Schlunk concludes that the shiny attraction of the letters JD behind a graduate’s name may be worth less than commonly believed. Schlunk argues that undergraduate grades are a strong indicator of future earnings power and that the fact that high-achieving undergraduates are more likely to get a law degree has skewed earnings comparisons. When Schlunk compared law graduates to their undergraduate-degree-only academic peers, the results were bleak. Middle-of-the-pack students (when the costs of attending law school are all factored in) begin their law careers behind financially and are “unlikely ever to dig themselves out for that hole,” he concludes. Only “hot prospects” who go to the best law schools have made an “acceptable investment,” he argues.

http://www.forbes.com/2009/12/21/mba-law-journalism-gre-gmat-personal-finance-grad-school-applications-up.html

I unfortunately fall into the “middle of the pack” group. That means I am competing viciously for those high paying 30-45k a year jobs out there. With a student loan payment of $1000 per month, im broke broke broke. Looks like me and millions of others wont be buying a home, car, or stocks for a loooong time.

Also consider that legal jobs are being outsourced to India:

Clients are pushing law firms like Jones Day and Kirkland & Ellis to send basic legal tasks to India, where lawyers tag documents and investigate takeover targets for as little as $20 an hour. The firms are part of a trend that will move about 50,000 U.S. legal jobs overseas by 2015, according to Forrester Research in Boston.

http://www.nytimes.com/2007/08/21/business/worldbusiness/21iht-law.4.7199252.html

So even as more and more JD’s are looking for work at home, these jobs are being outsourced for a fraction of the cost. These walking derivative graduate debt slaves are going to be in a world of pain.

REAL FUZZY NUMBERS: LAW SCHOOLS FUDGE ALUMNI EMPLOYMENT AND SALARY DATA

Its amazing how big of a role the fuzzy numbers plays in continuing demand for law school. Law schools publish that 90% of their grads find employment, and that they have great salaries. I call BS. The primary tool used to accomplish the law school scam is the bogus income-salary and employment statistics used to give a false picture of how well the law school grads do.

How many graduates are working in non-legal settings?  What are the salary ranges and distributions within legal and non-legal practice settings? Is there any evidence that some schools have better placement records as a result of curricular initiatives?  Remarkably, no one in legal education knows the answers to these questions. Schools should be required to submit a list of the employers and job titles for all of its graduates, and the Section should then code and compile these lists in a way that reveals the full range of outcomes, thus enabling meaningful school-to-school comparisons.  The lists themselves need not be published; the binning process would capture the useful information while also ensuring student anonymity.  There is a high probability that the current ABA coding system (e.g., “academia”, “business”) contains outcomes that make $120K in legal education look like a bad investment.  The Section should follow up with these graduates to better understand their circumstances, including the decision-making process that the graduates relied upon.

http://lawprofessors.typepad.com/legal_profession/2009/11/a-starting-point-for-law-school-outcome-measures.html

Bottom line: were to I have ever known about the reality that most lawyers face I would not have taken the gamble of going to law school. Thats what it is essentially, one big gamble. And the odds are against me. Biglaw wont consider me, and small law will pay 15-20 bucks an hr. You see, as a market participant I misread the market because the data I was relying on is PATENTLY FALSE. Except the secret has been kept hush hush by the guess again, MAINSTREAM MEDIA. There are many bloggers who cry bloody murder about the deception taking place amongnst law schools. The first thing I looked at before applying to my law school was “EMPLOYMENT DATA”. I saw 95% employed after 9 months. Average salary: 70K starting. I said not bad. I could easily take the average, and took the chance that I could be above average. Now that I see the REAL MARKET WAGE for lawyers like me are in the low 30’s to 40’s a year, I would have become a plumber instead.

THE MARKET FOR THE MIDDLE OF THE PACK GROUP

Worcester law firm looking for an aggressive associate to handle collection cases, 1+ yrs experience, litigation exposure preferred.

25,000 a year? Say the associate works 50 hrs a week. 2 weeks unpaid vacation. 50 weeks X 50 hrs = 2500 hrs. 25,000/2500 hrs = 10 dollars an hour. Wow. $150,000 grand to go to law school and this is what you can earn. On a 150k student loan which cannot ever be discharged, the monthly payment is $1200 a month on a 25 yr plan. 25,000 a yr is 2083 a month. After taxes your broke with rent and student loan.

 

Attorney & File Clerk – State of Florida (Downtown W. Palm Beach )

Attorney
This position has a full benefit package with an annual salary of $15,080.00. The position has opened with the possibility to hire someone who may be looking for the benefits portion more than the salary. The State of Florida offers 100% paid health insurance for yourself and your immediate family, six weeks paid vacation per year, paid state holidays, paid sick leave, deferred compensation, tuition free college, Florida Retirement System plus more. Applicants must be a member of the Florida Bar.

http://miami.craigslist.org/pbc/lgl/1569020234.html

What a sick joke. 15k per year.

 

How about this offer:

Miller, Curtis & Weisbrod is hiring an attorney for our Dallas office, to work on nationwide pharmaceutical litigation. The lawyer will work on a variety of different dangerous drug cases around the country. The ideal candidate will have 5-15 years of plaintiffs experience in pharmaceutical and mass tort litigation, but other experience will be considered. Candidates need to have experience in taking and defending depositions, attending hearings and strong preference for trial experience.

Salary
USD 40,000.00/year

Wow! 15 yrs of experience gets you a whopping 40k a year!

 

Bear

 

  • Tue, Feb 23, 2010 - 12:13am

    #2
    Peak Prosperity Admin

    Peak Prosperity Admin

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    Re: The dismal future for law graduates

Bear –

This confirms something I’ve been wondering about for quite awhile. I have decent number of friends and family members who have recently graduated, enrolled in, or are planning to enroll in law school. It seems that the reason that most of them are making this choice is simply due to lack of other options. I’ve literally heard people say that they are going to “ride out the recession in law school”, thinking that somehow this will all have blown over by the time they graduate. I keep thinking that with all these applicants the standards for entrance must be at an all time high. But everyone seems to keep being accepted. Something is certainly amiss.

Best of luck to you.

Gabriel

  • Tue, Feb 23, 2010 - 12:33am

    #3
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

Bloggers have been screaming about this for years apparently but with the onset of the great depression part II more and more grads are beginning to notice. Its a law school bubble and has all the characteristics of a bubble. People keep enrolling and borrowing to get a law degree with no real hard look at the rapidly deteriorating economic fundamentals. I feel really bad for all the other grads like me that are struggling financially. I also feel bad for the established attorneys that are getting crushed by the flood of new applicants. Sure, we need lawyers in this country but 210 law schools is too much. This country needs 90-70 law schools and thats it. The fact that the American Bar Association allows the fudging of employment data to take place is a great crime. People are relying on the ABA and Law School data as most people presume that these are prestigious institutions. Of course, after the events of the last 2 years people should question all official data. This country has resorting to scamming everyone and anything it could scam, from subprime home borrowers to subprime grad school attendees, pension funds, social security recipients. The social fabric of this country is deteriorating rapidly. Im having serious thoughts of moving to Australia, at least there my JD will hold some value. Ive heard that US lawyers can transfer there after 1 yr of school and still get to work part time and get paid for it.

  • Tue, Feb 23, 2010 - 01:05am

    #4
    Peak Prosperity Admin

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    Re: The dismal future for ALL graduates

Its not just a law school bubble, there is serious academic “inflation” in all professional fields. 

When I went to Chiropractic college in 1990 tuition cost $3,800/year, now tuition is over $30,000/year!  New graduates make $30-40K/year if they can find a job.

Ph.D’s flipping burgers is in our future, if its not a reality already. What a waste.

  • Tue, Feb 23, 2010 - 01:15am

    #5
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

Its one thing for realtors and the Mortgage Bankers Association to go around and pump housing data, its another for our educational institutions to pump out FALSE employment data. At least subprime borrowers can default on their loans. Student loan debt is with you forever and ever unless you get a job with the federal government and stay there for 10 yrs. Also, realtors are looking to make a quick buck. People in education should be held to a higher standard, but apparently this is no longer the case.

The word needs to get out that grad school is a joke. Unless your creme de la creme student or have super crazy connections, dont bother.

  • Tue, Feb 23, 2010 - 01:21am

    #6
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    Re: The dismal future for law graduates

I feel sorry for lawyers. I think they should all move to Australia.

V

  • Tue, Feb 23, 2010 - 02:31am

    #7
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

Architects beat you to it BMT.

Experienced architects have been looking for any job they can find for 30 years. The average student leaving school with a masters in architect an expect a pay scale of around 38k – 41k a year. Even after 10 years of experience the pay doesn’t go up that much. There is always a huge number of new students coming out school that are eager and willing to work for much less.

If I’d known this I would have spent my time and money on being a licensed electrician. After being through our ‘higher education’ system I’m a very big proponent of trade schools.

College is over priced, over valued, over hyped, and out dated.

  • Tue, Feb 23, 2010 - 03:04am

    #8
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

[quote=bearmarkettrader]

The word needs to get out that grad school is a joke. Unless your creme de la creme student or have super crazy connections, dont bother.

[/quote]

I hate to say it, but I have to mostly agree with you on grad school.  Even employers aren’t much of a help anymore.  I work for a pretty big company, and in 2006 (before the “recession”) I wanted to know how much the company would help in paying for a Masters degree.  Turns out the amount they were willing to put forth for that degree amounted to barely 2 classes per year excluding books.  In a state school at resident tuition no less.  So if I didn’t want to borrow MORE money, it’d take 5 years to finish ugh.  Now my company doesn’t offer as generous educational benefits as some, but IMO it’s a problem of inflated tuition and education costs more than anything else.  Jacking up tuition without cutting spending and leaving it up to the employers or states or scholarships to pay the difference for a lucky few students is a poor solution.  But sadly that’s the current status quo in most universities.

One of the plusses to an engineering degree in my mind was that graduate degrees were generally optional unless you planned to teach.  But that’s changing too… a lot of the job postings I see are specifically asking for a masters degree in addition to relevant experience.  It’s really kinda silly to ask for such a thing unless the job is highly specialized, but with the majority of these job postings it seems to be more of an arbitrary benchmark and nothing that relevant experience can’t cover.  But even I’m in a better situation than my wife who desires to be a doctor, and I cringe at what medical school could cost.  We’re looking at our options and going overseas for her schooling is one we’ve considered heavily. 

As for law prospects, I’m thinking some of the better routes may be the somewhat unconventional or seldom explored ones.  Maybe joining a small business venture where law skills are used to complement some other business function, like a startup that needs in-house help to establish its scientific patents.   

– Nickbert

  • Tue, Feb 23, 2010 - 03:08am

    #9
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

I’m an attorney.  I recently attended a function where I talked for a long time with the president of one of our area’s larger law firms (about 200 lawyers).  Bottom line, he said:  “I would never encourage anyone to go to law school.  The job market is atrocious.  The worst I’ve ever seen.  And it’s not going to get better for a long time if at all.  People who are graduating near the top of their class and taking jobs that usually attracted the new graduates from the middle and bottom of the class. If you’re not near the top of your class, forgetaboutit.”

  • Tue, Feb 23, 2010 - 04:58am

    #10
    Peak Prosperity Admin

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    Re: The dismal future for law graduates

 

A while back I heard a Gerald Celente interview where he stated that parents who sent their kids to college to get degrees in business, finance, law and other such pursuits were wasting their money. As a trend forecaster, his opinion was that trades such as farming, carpentry and other traditionally blue collar crafts would be a more promising vocation in the economy to come. I think this is consistant with a point Dr. M made (which I now paraphrase because I couldn’t find the article. Sorry.) a while back when he described the three layers of wealth, the first being farms, timberland, mines etc., the second being things like real estate and such that are built with and upon the first. Third, are paper assets, intangible commodities that are based on the first two. It seems to me that in these times the farther one gets from the ground the more unstable the economic strata.

BearmarketTrader, I think if you joyfully pursue another way of earning a living while still keeping your eye on the ball (law), you will eventually make a breakthrough. The exposure to people you meet by being actively engaged will open doors. Just don’t be surprised if that breakthrough is the discovery of another pursuit more rewarding than your original goal. That’s what happened to me.

Good luck!

 

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