This is the second of three posts on the current state of the legal job market. The first discussed the preliminary results of a study I did of employment of recent graduates from my law school and explained why nine-month job data does not tell the whole story on employment. This post discusses the idea that the market for legal services is undergoing a profound structural change. The next post will discuss the Bureau of Labor Statistics projections for lawyer employment. [Update - the third post is here.] The whole series is collected in this document.
The Structural Change Issue.
Another piece of the current conventional wisdom is the argument, generally associated (at least in US law circles) with Bill Henderson, that the legal job market is undergoing profound structural change. My reaction to this argument has taken an interesting trajectory. I was initially deeply skeptical of the argument. The more I thought about it, the more I started to think that there was something to the structural change idea. My current thinking is that some structural change is occurring in the legal job market, but that this change has been gradually occurring for many years. I therefore think that this structural change is something that legal educators should think deeply about, and I agree with some of what Professor Henderson has to say about the subject. I am skeptical, however, that the structural change has much, if anything, to do with the current state of the legal job market. I am also a bit skeptical of how deeply the structural change will penetrate into law practice. Professor Henderson has written a lot on this subject that deserves a more thorough analysis than I can give it in this post. For now, I want to focus on these last two points – whether structural change is responsible for the current state of the job market, and how deeply structural change will impact law practice.
The structural change argument has a few components to it, but for me the most interesting part of it is the claim that technology, specialization, and process engineering are making legal work increasingly standardized and systematized. Professor Henderson, discussing the work of Richard Susskind, writes that “Susskind asserts that legal work is gradually migrating from bespoke (e.g., court room practice), to standardized (e.g., form documents for a merger), to systematized (e.g., a document-assembly system for estate planning), to packaged (e.g., a turn-key regulatory compliance program), to commoditized (e.g., any IT based legal product that is undifferentiated in a market with many competitors).” (Blueprint for Change, at 479). As legal practice becomes more routine and commoditized, compensation for lawyers will come under pressure. The structure of legal services will change as well, with lawyers (or, more broadly, legal service providers) working for specialized firms that look more like service providers in other industries than contemporary law firms.
Although I think it has limits, I think it is true that at least some change of this kind is occurring in the legal industry. I do not think, however, that it is particularly new. One example of this kind of change discussed by Professor Henderson is the rise of firms that provide contract attorneys for discovery work. My first big assignment as a law firm associate in 1997 was to supervise a major document review and coding projects (ah, the glories of Biglaw!). At one point, I had 60 contract attorneys working for me. We were using technology to make the review process more efficient. This technology has improved over time, but technological change has also created a dramatic increase in document review work. Even in 1997, the increased use of e-mail was creating many more documents for review than had been created in the past when written communication was exclusively on paper. In the document review world, technological change has probably created more work in the last 20 years (by exponentially increasing the number of documents to be reviewed) than it has eliminated (by automating parts of the process). It is also worth noting that while certain aspects of document review can be performed by trained monkeys (and thus can be automated), other parts require the work of human beings exercising judgment. More importantly to the subject of this particular post, I don’t see change in the document review world in the last few years that is different in kind than change that had occurred in the prior 15, making it unlikely that any changes in this area are the cause of the present relatively poor job market.
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