A Stunning But Largely Unnoticed Anomaly In Recent Employment Outcomes Data Suggests That Things May Be Even Worse Out There Than We Imagined

In the Spring, a law dean’s fancy turns to thoughts of . . . jobs.  In reaction to employment prospects for new law graduates that are seriously inadequate for what is probably the first time in the history of the American legal profession, employment outcomes data are the focus of increasing attention.  Percentages of the next-to-last graduating class employed at graduation and nine months after graduation currently comprise 18% of the basis for the much-maligned US News rankings, the latest installment of which was released just last week (see here).

And rightly so.  Just ask yourself a simple question:  If you were deciding whether or where to go to law school, how important would you consider information about how many of a law school’s recent graduates had found full-time law jobs?  It’s a pretty essential measure of how likely it is that you would be able to use the degree you were about to spend over $100,000 and three years of your life acquiring, right?

Now let’s take it a step further:   How important would you consider information about how many of a school’s recent graduates listed as “employed” in fact had only temporary jobs funded by the law school they had attended?  Pretty darn important, because realistically only those graduates unable to find a permanent, paying, full-time law job would take a temporary one funded by their school.  (Surely you would prefer a temporary school-subsidized job to no job at all, but equally surely you would prefer a “real,” permanent, paying law job over either.)

Since the Great Recession began, we’ve heard here and there (and more recently here) about a few law schools helping out a few graduates with employment subsidies of one kind or another.  But US News’s reports of school after school boasting over 90% postgraduate employment got us thinking—how many of those are really permanent paying law jobs?

The preliminary results of our inquiry are nothing short of stunning.  I expect to post a more comprehensive dataset within a week or two, but at first glance it appears that significant numbers of top-tier law schools are subsidizing the employment of significant numbers of their recent graduates.  Here are a few examples:

• Washington & Lee (US News rank 24):  The school (and US News) report 89.4% of the class of 2010 employed at graduation, and 90.2% employed 9 months post-graduation.  But according to W&L’s own website, a full 41% (yes, 41%) of the graduating class held temporary positions funded by the law school at graduation, and 10% of the class still did 9 months later.  Take out the temporary positions funded by the law school, and the actual employment numbers are 48% at graduation and 80% at nine months. 

 

• Vanderbilt (US News rank 16):  The school (and US News) report 89.6% of the class of 2010 employed at graduation, and 91.6% employed 9 months post-graduation.  Over 20% of the class of 2010 held temporary positions subsidized by the law school at graduation, and 11% still did 9 months later.  Take out the temporary subsidized positions, and the actual employment numbers are 68% at graduation and 80.6% at 9 months.   

 

• University of Minnesota (US News rank 19):  Reports 91.9% of the class of 2010 employed at 9 months.  14.1% of those were in positions funded by the law school (2.4% of those in what the school describes as “long-term” positions).  The actual employment number at 9 months is 78-80% depending on how you count the “long term” school-funded placements. 

 

• Notre Dame (US News rank 22):  Reports 91.3% of the class of 2010 employed at 9 months.  12.2% of the class held temporary positions through a school-funded “Public Service Initiative.”  The actual employment number at 9 months thus is 79.1%. 

 

• Arizona State (US News rank 26, jumping up from 40 last year):  Reports 98.2% of the class of 2010 employed at 9 months.  12% of the class holds school-funded fellowships.  Take these out, and the actual employment number at 9 months is 86.2%. [post amended 3/20/12 to include repaired link to ASU employment data]

 

• Even mighty NYU (US News rank 6) reports 96.6% of the class of 2010 employed, but 7.6% of the class held temporary “postgraduate grant positions.”  The actual employment number thus is 89% (with some lack of clarity about when some portion of the grant recipients found permanent employment).

Let me be clear:  These data do not show that any school has been dishonest in its reporting.  To the contrary, all the information provided here is publicly available on the relevant schools’ websites.  Nor do these data suggest that any benefit of this kind is intended to mislead anyone regarding a school’s postgraduate employment prospects.  Again to the contrary, this is a rational strategy to help graduates find permanent law jobs in the current depressed market, for the simple reason that the best way to get a job is to have one, and the experience and references it provides, from which to move on. 

But there are a number of very important things that these data do show.  As mentioned above, we’ll have a more complete dataset in a week or two, but I predict that more detail will indicate that significant numbers of the most prestigious law schools in the country are funding temporary employment for significant portions of their graduating classes.  And what that suggests is that the current legal job market is appreciably more depressed than many interested observers had previously estimated.  We thought it was bad, but not this bad.  After all, if something like one in five of the graduates of the 50 most prestigious law schools in the country can’t find a permanent, full-time law job within a year after graduating, what does that tell us about the prospects for graduates of the additional 150 accredited schools falling below them on anybody’s list?  There are a number of schools in the “unranked” section of US News’s listing with nine-month placement rates under 50%.  Holy cow.

Another thing these data show beyond serious question is that US News has screwed the pooch again.  Since we can all agree that any rational decisionmaker would consider the prospects for a temporary school-subsidized job to be much less valuable than the prospects for a permanent full-time law job, US News’s investiture of 18% of its entire ranking in a statistic that fails to distinguish between the two when the former will sometimes be 20% or more of the latter inevitably results in some pretty serious distortions.

I will have more to say about all this (including some suggestions about why we are where we are in the job markets today) in future posts.  In the meantime, it’s worth noting that the Pre-Law Committee of the ABA Section on Legal Education and Admissions to the Bar has circulated proposed revisions to Accreditation Standard 509 and its associated forms (which concern the “consumer information” that accredited law schools must disclose to the public) requiring law schools to break out postgraduate employment numbers by (among other things) part-time vs. full-time; long-term vs. short-term; “bar-passage required” vs. “JD preferred” vs. “professional position” vs. “nonprofessional position”;  and “Of employed—University/Law School Funded Short Term” (see here and here).  Let’s hope the Committee sticks to its guns.

As for US News, it acknowledges the coming changes and says it “plans to incorporate this more granular data into our methodology for future rankings.” 

--Bernie

Comments

[Bill Turnier]

Very informative. Thanks for all your hard work on this.

[anon]

Wow.

[anon]

I think the raw numbers make the data even more stunning. According to its website, Washington & Lee hired 60 students for its fellowship program. The New York Post reported NYU hired 38 students at $2,000 per month for 3 to 6 month positions. I think it's time some of us started looking in the mirror to ask if we're travelling on the right path.

[Academic dean]

This is really interesting, and seems more consistent with things one hears informally, though what one hears informally isn't necessarily to be trusted. Without meaning in any way to argue with the data, I wonder if you have considered whether it might mean somewhat less than it seems insofar as it might reflect changes in hiring patterns. I'm thinking specifically of the old, largely Biglaw paradigm of hiring midway through the third year, then subsidizing a period of ineligibility to practice until the new graduate passes the bar exam. We at public law schools have been complaining for some time that the US News employment spot-check dates are skewed badly in favor of elite privates, where the old paradigm still (perhaps) prevails. Large publics tend to place many students in government and public service jobs, and many of those employers won't (and in some cases, can't) hire people who aren't admitted to the bar, a process that in some states can take many months. Is it possible that more private sector employers are taking this tack? If so, then the data, although certainly dispiriting, might not be quite so bad as it seems.

[CHS]

I am constantly surprised that people are surprised that graduates are having a tough time getting jobs in the middle of one of our worst recessions. It is a good thing that schools are able to give graduates time to keep looking. It would be worth it to find out the fates of people who have been in these jobs. How soon do they get jobs outside of their schools?

[Bernie Burk]

Academic Dean,

Excellent question, and one I've thought about. Unfortunately, I think the answer to your question is no. Like your school, UNC has a proud tradition of public service. We send fewer graduates to BigLaw relative to their credentials, and relatively more into government, nonprofits and the like. These employers often do hire later because they require a bar card.

While I haven't gathered data systematically, my anecdotal understanding is that BigLaw still hires many entry-level employees comfortably in advance of their start dates, including after On-Campus Interviews in students' third years as well as by employment offers after 2L summers (with much smaller but still functioning summer programs often the firm's single largest source of new hires).

What this means is that schools sending greater numbers of students into employment requiring bar admission have markedly lower "employed at graduation" numbers, but by nine months out this factor's effect should be modest. By then, students have had time to take and pass the bar, and the employers who want new graduates with a bar card know to be looking for any they may need at that point.

I'm afraid that the phenomenon noted in the post is predominantly a function of the quantity rather than the timing of available positions--that is, it's caused by there being fewer jobs available, period.

Thanks for your interest!

--Bernie

[Z32]

Thanks, Bernie. Paul Caron over at TaxProf Blog put together a lovely chart of your numbers, which illustrates the percentage differences even more starkly:

http://taxprof.typepad.com/taxprof_blog/2012/03/a-peek-.html

[Prof.]

I have no quarrel with the data or the inferences drawn from them. But I do wonder if perhaps this isn't the rare case in which chasing US News rankings might be having a positive effect, at least in one sense. Based only on my anecdotal knowledge of some of the fellowships offered by schools in an effort to drive up their employment numbers, most of them seem to be in the public interest area. For example, some of NYU's fellows are placed at Equal Justice Works, which represents indigent criminal defendants facing the death penalty in Alabama. I have no affiliation with NYU - I chose it because it's the most prominent school on the list. My own school--less prominent, I can assure you--funds fellowships at the local legal services provider. My point isn't to applaud those who game the rankings. Instead it's to notice this one instance in which gaming the rankings might actually have a social benefit.

[Bernie Burk]

Prof's point is a very fair one. And of course nothing in my post condemns the use of these school-funded "bridge" positions to help graduates ultimately find "real" long-term jobs (and do admirable social justice work in the meantime). My principal point is twofold: (1) The widespread need for these bridge programs is an indication of a job market that is even worse than the very bad one most of us were envisioning; and (2) Given the apparent pervasiveness and extent of the programs, US News's failure to account for it in the employment outcomes factor in its rankings is irresponsible.

[Joe (not that one)]

I'll just chime in that my (non-federal government) office has used fellowship programs to hire two new attorneys over the past six months. Neither would have been considered if their schools hadn't given them a stipend to come work for free for several months.

[Frank the Underemployed Professional]

The data really makes you wonder just how many hundreds of thousands of people's lives have been destroyed or heavily scarred by the Law School Scam. This is most likely and old problem that just hasn't received this sort of attention until during the recession because JD overproduction has been occurring since the 1970s and today we have an attorney-to-population ratio of about 1 JD for every 215 people if you only count the JDs produced over the past 40 years. (The data was calculated using ABA stats for the number of JDs awarded and Census Bureau data.) See:

40 Years of Lawyer Overproduction, A Data Table, and Two Charts
http://flustercucked.blogspot.com/2010/07/40-years-of-lawyer-overproduction-data.html

Consequently, I also used Bureau of Labor Statistics information to estimate that fewer than 54% of all JDs produced over the past forty years are actually employed in the legal profession at jobs of varying quality and value:

Statistics Suggest That Only 53.8% of All Lawyers Are Employed in the Legal Profession
http://flustercucked.blogspot.com/2010/07/statistics-suggest-that-only-538-of-all.html

Using some assumptions about the percentages of newly-produced JDs who were able to enter and remain in the legal profession with it's being easier to do years ago when the attorney-to-population ratio was much lower, it may be possible that fewer than 30% of all JDs produced over the past 10 years actually work in the legal profession:

Statistics May Suggest That Less Than 30% of New JDs Were Able to Find Work in the Legal Profession Over the Past 10 Years.
http://flustercucked.blogspot.com/2010/07/statistics-may-suggest-less-than-30-of.html

Also, a significant percentage of those jobs may be of varying quality with many being low-income solo practices, Legal Aid, and small firm jobs.

The only solution to this problem is to shutter at least 75% of the law schools. It's too bad that we cannot just turn off the JD-production spigot entirely for a few years so that our society will be forced to utilize the legions of JDs it has already wasted tremendous amounts of money and resources producing.

[IP Law is Patently Delicious]

Frank the Underemployed Professional,

Your suggested solution seems somewhat overwrought. At the end of the day, a JD is like any other graduate credential; a gateway to a career. Run those numbers against PhD engineers and I bet you'll find similar stats indicating a great deal of those people do not work as an engineer, with still others holding low-wage jobs (teaching, non-profits, etc.) No one paying attention would argue there aren't enough lawyers these days, but even your stats indicated something like 30% of new JDs found legal work over the past 10 years. Turning off the spigot entirely would have eliminated those people from the job pool.

Get rid of the bottom feeding schools, absolutely. ABA is woefully screwing up its oversight role in that regard. Force accurate reporting of placement data, absolutely. ABA may be making some inroads on that score. But 75% of all law schools shut by fiat? I don't think that suggestion addresses the problem of too many lousy lawyers in the job market who are effectively killing earnings for everyone else. Oversight is the answer. Effective oversight. If the current ABA structure continues to demonstrate their incompetence in this area, to the ill of society and the profession, they should have that privilege revoked and another body should take on that role.

I'm in IP. There are many, many positions open to be filled with members of the Patent Bar, even in this terrible economy. This is why I never buy into the "sky is falling" argument, relative to law school output. It's also why I find the trial guys highly amusing when they complain about crappy clients. Cheers!

[Bored3L]

Prof I just had to respond to your sickening comment. It showed a complete lack of perspective. You realize these students have up to $200,000 in non-dischargable student loan debt, right? You are familiar with the average debt load held by your graduating students which is undoubtedly high five or even six figures? You realize what "chasing US News" rankings means for the financial future of your students (I happen to think US News is a convenient excuse and tuition would be just as high at most schools because they simply would be able to get away with it).

These programs may pay a subsistence wage, but they will never cover the average student's loan payments. You could accomplish that "social benefit" much easier if you and your fellow academics were willing to significantly slash tuition. Then perhaps your grads would be willing to take low-paid public interest jobs or join/start firms serving middle and lower income clients.

[Prof]

Bernie,

Until law schools do mandatory interviews as part of their admissions, a significant proportion of the graduates are going to be unemployable or incapable of sustaining continuing employment. I graduated in the boom years from a tip top school and some significant proportion of my class (mostly, but not entirely, the people who never worked before law school) found themselves unemployed at graduation because they didn't perform at their summer jobs, couldn't interview, had health issues that prevented them from succeeding at work, etc. That is flat out not the school's fault. A significant proportion of my classmates were laid off or pushed out of their first job (virtually everyone got biglaw) very quickly for these exact same reasons.

A 99% employment rate is unnatural at all but the very best schools that have the option of cherry picking people whose backgrounds suggest they can impress people (i.e., great recs) AND have grades that indicate they work very hard. Even once you get past Yale, some significant (and probably steadily increasing) proportion of that class is not employable or will not succeed at their first job.

There is simply nothing schools can do about this. Blame parents, blame high schools, blame whoever.

[Wholesale Nike Shoes]

it is a good post. i like it so much.thank you for your post.

[Dean in the 150]

I assume that your question: "[i]f something like one in five of the graduates of the 50 most prestigious law schools in the country can’t find a permanent, full-time law job within a year after graduating, what does that tell us about the prospects for graduates of the additional 150 accredited schools falling below them on anybody’s list?" was intended to be rhetorical. The answer to the question, however, is "not much."

Many of those lowly 150 schools do a much better job of preparing students to actually practice law than do the top 50, and law firms are beginning to understand that. Moreover, students from many of those schools carry a much lower debt load than students from elite law schools. Thus, they're not forced to rely on the increasingly dim hope of a six-figure salary at a large law firm--they can be prosecutors or public defenders or start their own practices. I suspect this is why Cleveland-Marshall College of Law, for example, has a higher percentage of its grads employed in full-time, JD-required jobs than any public law school in Ohio--including the two top-50 schools, Ohio State and Cincinnati.

[Ben]

Mr. Burk,
I am curious as to where you got your data saying that 41% of Washington and Lee students hold temporary positions funded by the law school at graduation. I can't find those numbers on the W&L website and would appreciate it if you would post a link.

Thanks!
Ben (W&L student).

[Ben]

Never mind, I found the data that you are referring to.

Thanks,
Ben

[Bernie Burk]

Reply to Prof (3/21/12 at 11:46 p.m.): With all respect, Prof, I question both your premises and your conclusion. It's not at all obvious that there is any significant inverse correlation between a school's prestige ranking (whether US News or other) and the portion of the class that is less employable or unemployable for reasons other than raw smarts or analytic ability (such as personality issues that affect interviewing or workplace success, or a weak constitution that interferes with managing long hours or stress). My own sense (and no, I don't have empirical data either) is that deficits in people skills, judgment, stamina, etc.--with the possible exception of stamina--are more or less evenly distributed across the greater law student population. Certainly all of us know plenty of supremely smart people (however you define "smart") with lousy judgment or people skills. The much-discussed data recently publicized by the National Law Journal suggesting that disproportionate numbers of candidates from less prestigious law schools "succeed" in BigLaw by making partner as compared with graduates of the most prestigious schools also suggests that your concern is not well grounded (though I fully concede that there are a number of possible explanations for this disparity, which are enumerated and explored by Bill Henderson with characteristically exceptional thoughtfulness and nuance in two excellent blog posts (1) here: http://lawprofessors.typepad.com/legalwhiteboard/2012/03/too-good-for-biglaw-the-statistician-edition.html and (2) here: http://lawprofessors.typepad.com/legalwhiteboard/2012/03/a-reply-to-the-empiricists-at-nwu-law.html).

If, however, you were right that less prestigious law schools had larger proportions of candidates who lacked characteristics essential to success as practicing lawyers (or success in certain avenues of practice), then employers would be acting rationally in accepting fewer candidates from the less prestigious schools. If this were true (and again, I think it's not), interviews and perhaps the school's longer-term reputation would reflect that more of its graduates lacked skills important to success in practice, and employers would be wise not to prefer them.

--Bernie

[Bernie Burk]

Reply to Dean in the 150 (3/23/12 at 10:29 a.m.): With all respect, Dean, I'm not sure your generalizations are justified. Some lower-tier schools do a better job of preparing students for practice than some first-tier schools, but I doubt that there is any strong inverse correlation between rank (by US News or other prestige standards) and effectiveness in preparing students for practice (however you chose to measure that). Two of the best clinical programs in the country are at Stanford and Georgetown; more generally, higher-prestige schools tend to have more money to devote to educational efforts, and more money at least sometimes translates to more innovative and personal instruction (with practice-oriented instruction often requiring more personal attention per student).

Nor would it be fair to say that there is some clear correlation between prestige and price. It costs about as much to go to many of the law schools in the "unranked" US News tier as it does to go to Harvard; and conversely, many well-regarded state schools that charge more modest tuitions are well-ranked (UNC, Alabama and Georgia, to name three).

If Cleveland-Marshall has been more successful in placing students than more highly ranked schools in Ohio, one of two things is going on: Assuming the employment numbers are not distorted by part-time, non-legal, or short-term school-funded bridge positions, C-M is doing a whole lot of things right that other schools should take notice of and emulate. It should rapidly begin to attract better-credentialed students, and in any rational ratings system its star should rise.

--Bernie