Part II: Taking Your Law School To Court

What makes a law professor, someone perched atop the legal profession, publish a blog titled ‘Inside The Law School Scam’? That is the question many have asked Prof. Paul Campos from the University of Colorado Law School. His blog has grown in popularity in the past few months as more and more students turned on their law school, complaining that they were victims of fraud. These disgruntled students argue that, had law schools been more forthcoming about the job market for newly minted lawyers, they would never have signed up for a Juris Doctor (JD) degree. In one of his most recent posts, Prof. Campos addressed the Class of 2015 with these choice words: “You’re sitting in the faux courtroom of the Titanic School of Law, preparing to spend the next three years sailing straight into the iceberg known as the American legal profession.”

Yikes.

Earlier in the summer, TheCourt.ca tackled fraud cases that came before American courts involving two law schools, the Thomas M. Cooley School of Law and the New York Law School. Though the judge found in favour of the law school in both cases, the damage to the legal institution was done. In the second part of this series, I will turn to the factors that undergird these cases and others: from structural changes in the economy to the failure of law schools to train lawyers for today’s world.

Dollars and Sense

No matter how you slice it, a law degree does not come cheap, especially in the United States. In the United States, private law schools can charge upwards of $50,000 per year in tuition alone. (Canadian tuition peaks at around $22,000 per year.) It comes as no surprise, then, that law school graduates are burdened by enormous amounts of debt – somewhere in the tune of $68,000 for a public law school graduate and over $100,000 for a private law school graduate in the United States.  Another way to think of it: for you to break even on your investment in law school, you need to make $200,000 more than you would have made with only your bachelor’s degree in your lifetime.

$200,000, over the course of your entire life, may not seem like such a daunting task at first. But only half of law school graduates found a job in the United States this year. To be more specific, only 55 percent of law school graduates landed full-time, long-term legal jobs. The overall employment rate nine months after graduation stood at 86%, the lowest it has been for almost two decades, according to the American Bar Association (ABA) Journal.

How to Make Sense of these Numbers

No matter which side of the argument you fall on, you can easily cite reasons for these dismal numbers. The most obvious culprit may be the overall state of the economy in the US. Depending on how it is measured, the unemployment rate hovers around 8 to 9% as of the end of July 2012. And when the economy is weak, those who are hit hardest are usually new graduates, who have little or no prior experience.

What makes the legal market particularly dismal right now is that it has been in a state of decline for almost a decade. The number of law office jobs began to decline in 2004, well before the economy took a plunge. (The economy did take a toll. Some 15,000 attorney and legal-staff jobs at large firms vanished during the worst of the recession.) But the economy is surely going to recover, right? Right. But the demand for new lawyers is not going to keep up with the pace with which the economy will recover, according to some commentators.

One reason is that some law jobs that were eliminated during the recession may never come back. Law firms have started to outsource legal work to places, such as India, where lawyers can do the same work at a fraction of the price; by installing smart software to search documents for evidence, law firms are eliminating the need for low-end lawyers.

Oversupply or Maldistribution?

While most of the numbers have been focused on the United States, as opposed to Canada, the question of whether there is an oversupply or merely a maldistribution of lawyers is certainly pertinent in both countries. One buzzword that has gained traction in the legal community in recent years is “access to justice.”

Those who defend law school point to large areas in the country – whether the US or Canada – that lack adequate and affordable access to lawyers. Think northern Ontario or rural Saskatchewan. So, perhaps it is not that we are graduating too many lawyers; it is that these lawyers are all concentrated in big cities, elbowing each other for the same Big Law jobs.

In addition to adjusting to living in northern Ontario, new law school graduates face another problem. In the United States, “studies find that law students need to earn around $65,000 a year to get the upper hand on their debt.” The number may be slightly lower in Canada. Regardless, that threshold would be difficult to reach by hanging your own shingles in rural Saskatchewan or working in a legal aid clinic. The numbers would not add up. While law schools may be faulted for not better preparing students for this kind of work, it is the law students themselves who resist it, and prefer to enter Big Law, however elusive and hostile it may be.

A Not-So-Quick Fix

We may not be able to fix the overall economy or even the structural changes within the legal industry (i.e. outsourcing), but we can take strides to make the cost of law school in proportion to the economic opportunities obtained by its graduates. Everything from making student loans less accessible to closing some law schools have been proposed. For instance, in the United States, it is relatively easy to secure an astronomical loan for law school ($100,000 +) because the federal government currently guarantees these loans from private lenders. That has basically given the green light to law schools to continue increasing tuition fees year after year. Law schools do not need to be so expensive. Sure, they need to compete to recruit bright students, but the operations of a law school are not expensive. Law schools do not house laboratories with state-of-the-art equipment. Newer, faster, stronger do not necessarily mean better in the legal world.

The simplest solution would be to close down the lowest ranked law schools in the country. Or, law schools should try to filter out students who are drawn to law for monetary reasons alone. Law schools should also stop cooking numbers (i.e. median salary) to entice students. Even if it does not amount to fraud, it is still misleading and dishonest.

And Now Canada…

Unlike their American counterparts, Canadian law schools have been spared some of this vitriol. Our situation is less dire: we graduate far fewer students; and our job market has been more resilient than in the US. But that does not mean that we should not examine our own institution carefully.

The goal of the Law Society of Upper Canada has been to match one law school position to one articling position. This summer, an articling task force was assembled to address the issue of articling – whether it needs to be changed, or eliminated altogether. Without going headfirst into this debate, what needs to be underlined is that we are beginning to accept that things may need to change in Canada. The driving force behind the task force, and the subsequent report (here), is the shortage of articling positions in recent years (pp. 9).

Let’s begin with the most straightforward numbers. In March of 2008, 5.8% of law school graduates in Ontario could not be placed in an articling position. Three years later, in 2011, that number soared to 12.1% (pp. 10). Earlier this summer, the Law Society disclosed that that number has climbed up to 15%. That means that one in seven law school graduates in Ontario will not complete his/her articles and, therefore, not be called to the Bar.

But what if the trend continues? This is where we should be more worried. 71 percent of articling placements are at medium- to large-size law firms (pp. 9). That should be a good thing for debt-burdened students, right? Not necessarily. The size of the legal profession in Ontario has grown significantly in the past decade. There were 23,833 practicing lawyers in 2001-2002; in 2011, there were 31,984 (pp. 10). The number of law firms hiring students, however, has remained more or less unchanged. One reason is that Ontario has relied primarily on these medium- to large-size firms to scoop up our new graduates. These firms are not growing at a pace that matches the pace of law schools. (The University of Toronto Faculty of Law allowed their student body to swell by 15.4% between 2011 and 2011. The University of Ottawa graduated 33.2% more law students in 2011 than 2001 (ibid).

If we continue to funnel our graduates into these kinds of law firms, we may be in trouble. These larger firms are feeling pressure from the corporate world, where companies are emphasizing their bottom line more than ever. 65 percent of all articling positions are located in large cities – Toronto, Ottawa, etc. Only 2 percent of placement can be found in the northern parts of the province (pp. 9). This is a staggering incongruity.

Parting Words

Law schools, particularly in the United States, have been crucified for allowing their students to be buried under a mountain of debt, while failing to provide them with jobs. Sure, some law schools need to close, charge less tuition, offer more student aid, introduce programs that better train students for the legal jobs in demand, and the list goes on.

But as one judge reluctantly put it: buyer beware! Students need to know what they are getting themselves into. They need to manage expectations. In Canada, students can no longer treat an acceptance letter as a free pass to being called to the Bar. Moreover, the days of easy money are pretty much over on both sides of the border.

Students can try to enroll in better law schools and get better grades. If it’s an option, even live at home and try to be as frugal as possible. And, before they go to bed at night, law students should say a little prayer, and imagine – even if for a fleeting moment – practicing law at a small firm in a coal town in northern Ontario. Try that exercise a few times, and it may just work.