A marked divide has developed among law schools and within the legal profession that has significant implications for individual lives and for social justice. The situation is well known, but has yet to be examined seriously and comprehensively.
A substantial majority of graduates from top 20 law schools take positions in corporate law firms. These newly minted lawyers are well compensated. Leading New York law firms pay first year associates up to $165,000 a year. Most of these firms also pay year end bonuses that range from $30,000 to $65,000. Starting lawyers at corporate law firms in other major cities earn a bit less, but they are still paid handsomely. Within five years, these corporate lawyers can earn $250,000 annually.
But what about the prospects for law graduates from non-elite law schools (the 160 or so law schools outside the top 20)? Typically, only the top 10 percent of the graduates from these law schools land corporate law jobs. At many law schools the number is much lower. The remainder—a majority of law graduates each year—work for the government or in small firms that serve individuals or other non-corporate clients. The pay for this large group of lawyers has decreased in real terms in the past two decades (as documented in Heinz, et. al., Urban Lawyers (Chicago 2005). Many of these lawyers earn starting salaries in the $40,000 to $50,000 range, with modest increases over time. A number of graduates do not even land these jobs, relegated instead to part time legal positions (serving as legal “temps”) or non-legal positions. Heinz’s study showed that lawyers who start out in the non-corporate “hemisphere” rarely make a transition into corporate legal practice, so a lawyer’s career is relatively set at the outset.
Although lawyers have markedly contrasting earning potentials, they pay about the same tuition. Elite and non-elite private law schools charge around $35,000 per year for tuition; tuition for public law schools ranges more widely, with many set between $10,000 and $20,000 per year. Students must pay an additional $10,000 to $15,000 per year for living expenses.
The out of pocket cost of a law degree thus approaches $150,000 for private law schools, and can reach $100,000 for public law schools. Students who borrow to cover their legal education pay much more over time. Although a law degree still pays for anyone in line for a corporate law job (for a $150,000 investment, a graduate can earn $800,000 to $900,000 in the first five years alone), for everyone else it is a closer call. Remember that every potential law student already has an undergraduate degree, which represents earning potential (and three years of law school entails three years of lost income).
What does this mean for individuals thinking about becoming a lawyer?
Anyone admitted to an elite law school is in good shape—by all means, go. Everyone else, however, should think long and hard about whether attending law school is the right decision. Specifically, one must take a close look at the financial implications of attending law school: how much money will be borrowed, the expected amount of the monthly payments upon graduation, and expected income upon graduation. Too few prospective students sit down and crunch the numbers. An after tax monthly income of $3,000 (based on a gross income of about $45,000) sounds pretty good, until the $1,200 monthly loan payment is factored in.
They key here is to be realistic. While many entering law students think (or hope) that they will be in the lucky top 10 percent that land the corporate law job, the hard truth is that 90 percent of graduates will not get these jobs, and will therefore earn far less over time. Given these long odds, a prospective student with a degree in engineering or business, or other fields with solid earning potential, or people who already have decent jobs, might be better off not going to law school.
Today, the only reason to go to law school (at least outside of the elite schools) is that one is absolutely determined to become a lawyer. For everyone else, law school is a long, expensive, laborious slog, which offers uncertain rewards.
What does this mean for social justice?
One implication of the current situation is that becoming a lawyer is no longer the sure path to upward mobility that it once represented. It can still deliver this social benefit, to be sure, but the cost barrier is becoming increasingly burdensome. People from low income backgrounds may shy away from taking on huge debts to attend law school. Not only will this be socially detrimental, it will be a regressive development for the legal profession, as lawyers will increasingly almost exclusively come from upper middle class and wealthy backgrounds (as was the case a century ago).
Another implication relates to the provision of legal services. Students who enter law school with the desire to work in public service positions often instead become associates at corporate law firms owing to concern about the hefty loan they must repay. Many elite law schools offer debt forgiveness programs for students that take low paying public interest jobs, but most graduates do not enjoy this benefit. What this means is that fewer and fewer lawyers can afford to work in public service positions. If current trends continue, moreover, it is possible that low paying legal positions of all kinds will go unfilled, as these positions make no economic sense for law graduates (only the desperate will take them). This sector of the legal market consists of the needs of poor individuals, chronically underserved as it is, and promising to worsen.
Another set of consequences relates to the financial pressures put on lawyers and the growing chasm in the legal profession. Although it is true that lawyers have always focused on making money (notwithstanding protestations otherwise), it is not true that lawyers in the past have exclusively focused on making money. Lawyers have also espoused and often tried to live up to a set of professional values. As the cost of becoming a lawyer rises to ever greater heights, lawyers cannot help but be increasingly concerned with making money. Lawyers may be less inclined to take a stand against an unethical course of action desired by a client if they are worried about losing the client to another lawyer. More generally, the professional bonds that lawyers share will be frayed by the fact that the profession is starkly divided into such different hemispheres.
Some of these implications for individuals and for social justice have already begun to show. As a society, we must begin to pay attention to the situation before it worsens beyond our control. It may already be too late.