Law School Applicant Pool Likely To Shrink Further

LSAC has now released data about the number of people who sat for the October LSAT.  The total number of takers was down 10.9% from October 2012.  The number of first time takers was down roughly 13% from last October.  

When you pair this data with attendance levels at recent LSAC Law School Forums (law school fairs, essentially) in Boston (down 47% from last year), Houston (down 15.4% from last year) , Miami (down 16.3%), and New York (down 18%),  law school admissions teams and law school deans are staring down some grim news.  (One contrary data point: the summer LSAC Law School Forum in D.C. showed a decent uptick in attendance.) 

We don't yet know the total slide in law school matriculants for this year but many people are guessing that there are roughly 40,000 1L's at ABA schools this fall.  The possibilityof yet another 10% dip suggests that most schools will have to make significant concessions in student quality, revenue, or both.  What remains to be seen is how many schools will be able to gain additional funding - or radically restructure, how many will simply accept a nosedive in admissions predictors, and how many will simply conclude that the whole project is no longer worth the candle.

Bill Henderson predicted widespread law school  layoffs this fall.  While I hear rumblings of various sorts around the country - increased teaching loads, compensation cuts, buyouts (of varying levels of voluntariness), and a few layoffs - as best as I can tell, the hammer has not really fallen.  Take another 4000 tuitions out of the system however - call that $300 million dollars over three years (figuring an average tuition of $25/K per disappearing student) - and I imagine we'll be revisiting this whole issue again.  If that $300 million was spread across 200 law schools, that would still be a $1.5 million haircut .   But considering that the $300 million would likely be spread unevenly as more and more universities refuse further law school contraction, it's easy to imagine that the real costs to marginal schools might exceed $6 million over three years.  There are only so many subscriptions that a library can cancel.

Comments

[Former Law Review Editor]

This is good news, not bad news. The profession is saturated, jobs are scarce, and debt is weighty. It will be painful for those schools, but this will make for a stronger, smaller profession and more satisfied lawyers in the future.

[nosedive]

Uh-oh!

[Former Law Review Editor]

Dan,

I also think your numbers are conservative. You're probably looking at a $350,000,000 haircut for the current class over 3 years. Don't forget that the schools just lost their cash cow -- the class of 2013. So you're going to see a bumper crop replaced with 2 lean years. When you have 3 lean years (or the "new normal") populating the schools, that's when schools will close.

[JP]

I am interested in which law schools are already laying off professors. Seems like people are keeping pretty quiet. Please share. Also, any thoughts on which schools will be the first to close? My guesses are Appalachian (weak stand alone, ABA issues), Ave Maria (endowment of just over 2 million), Thomas Jefferson (weak stand alone, public lawsuit, overextended financially), and Touro (less than 2M endowment). Each are lowly ranked and in states with plenty of other law schools: VA, FL, CA, NY.

[Cent Rieker]

There are still alternatives to law school closures that bottom-feeding law schools will employ, such as even more lax admission standards. Furthermore, is it really out of the realm of possibility for the ABA to eliminate the LSAT as an entrance requirement? This will shield such schools from the negative spotlight of admitting students with scores in the low 140s, or even below 140. The median LSAT score at 30 schools is already in the 140s. http://lawprofessors.typepad.com/legalwhiteboard/2013/10/understanding-trends-in-demographics-of-law-students-part-two.html

Point being- I still think that we are a long ways away from school closures. If anything, the LSAC policy change in 2009-10 of only using the highest LSAT scores should have precipitated a further decline in applicants/students at lower ranked schools, by giving students a penalty-free incentive of retaking the test until they attain a respectable score.

[Orin Kerr]

Do you have a link to the data? I couldn't find the latest on the LSAC's data page.

[Hon. William H. Renchburg]

There's a lot of squeezing left to be done before closing or massive layoffs. (There may be more lathaming going on than is reaching the public.)

[Enrique]

Is this good or bad news?

[Confused]

Oren,

You can find the LSAT data here: http://www.lsac.org/lsacresources/data/lsats-administered

Dan,

When you refer to "concessions to student quality," are you talking about schools that have seen their LSAT median of enrolled students drop from 159 in 2011 to 155 in 2013? Do you think the choice to enroll far less qualified students is a wise one considering so many recent graduates have been unable to land jobs in the legal profession? Can you share your definition of "marginal schools"?

http://www.lstscorereports.com/?school=drexel
http://earlemacklaw.drexel.edu/about/facts/

[keep it going]

Amen.

[Confused]

Orin,

My apologies for the misspelling.

[Zorba]

You also have to take into account the fact that many parent universities will likely step in if admissions standards are cut too much, particularly those that dream of gaining a reputation as an "elite" school.

Anyway, there are definitely going to be a lot of unhappy unemployed law professors and administrators in the coming years. Hard to feel too much sympathy; they were warned, repeatedly, that the structure of legal education could not sustainably be centered around supporting massive salaries for not that much work.

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[Anon]

The continued decline in applications and the quality of those applicants as measured by traditional criteria has to lead to changes at some point but it does seem that Law Schools, and presumably Universities are moving quite slowly to address the changes. Some schools have gotten smaller but there has to be a point at which one wonders what the point of the school is -- can one really justify educating 80 or so students a year? Maybe but it seems not at the previous cost structure. On the opposite end, schools that do not get smaller will necessarily see an erosion in the quality of their class -- either in traditional metrics or possibly in less visible ones, as it is relatively easy for a school to keep up the median GPA of its entering class by admitting students from less selective colleges. The LSAT is tougher to manipulate though a creative admissions office can look at the class in the aggregate -- but manipulating the selection criteria to game the USNWR will not get those students jobs, or not likely. Some of the students from lesser colleges will do fine but there is also some possibility that they will not perform well, and it is also quite possible that law firms will balk at hiring individuals with less traditional credentials. Maybe not but it is possible. In any event, my guess is the shake out will come in a couple of years when the smaller schools can't afford to stay open with their current cost structures, and the larger schools have a hard time placing their lesser qualified classes. The top schools are not likely to be affected to the same extent but once you move outside of the top, it seems pretty clear that things have changed and that schools, like law firms before them, are not moving very well or quickly to adapt. For many schools, the main issue is top-heavy senior faculty who will not take the buy outs, which is a difficult issue to address.

[Louis]

When tens of thousands of people take out $100-250,000 in student loans on reliance of employment statistics provided by law schools and these people end up jobless or in low-paying $40-50,000 jobs, eventually the truth leaks out. Law school has financially destroyed thousands of lives and this is the eventual effect of that cause. If law schools would cease lying and misleading about salaries and job statistics, the market might balance itself out. This is just an example of the market beginning to reflect reality.

[Anon]

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[Paula Marie Young]

I attended the conference of the Midwest Association of Pre-law Advisors this past week-end. The programming was terrific. LSAC provided a graph showing that we have had similar cycles since the mid-1960s. This one is a bit more dramatic because we came off all-time highs in hiring and applicants in 2007.

The Dean of Wash U Law School, Kent Syverud, gave a very compelling speech. He says 175 of 202 law schools are operating at a substantial deficit, and the pain is being felt across the board, not just at so-called "marginal" law schools. Applicant numbers, by LSAT score, support that comment.

He also says law schools will cut costs in the following ways (any errors in this summary or mine):

- Private universities may shut down associated law schools, as they did dental schools in an earlier era;
- Schools have let hiring of new faculty grind to a halt;
- Schools will not replace, with a tenure-track faculty member, any faculty member who successfully moves laterally or retires;
- Schools will cut tenured faculty via buy-outs, etc., and use instead much more affordable adjuncts; Skills teachers could be especially hard-hit even at a time when the ABA and the profession are emphasizing skill development;
- Schools will cut staff;
- Schools will consolidate law libraries into main campus libraries;
- Schools will merge (like Texas Wesleyan); or
- Schools will sell out (like Charleston.

Some schools, including Wash U, had increasing enrollments last year. Many schools maintained entry level statistics, but reduced class size to do so.

One speaker predicted that by 2016 or 2017, the number of new jobs in law will exceed the number of new law grads if current trends in applicants and employment continue.

[Orin Kerr]

Paula, I hope you'll blog more about Kent's talk: It sounds very interesting.

[Anon]

Prof. Young's informative post should be the benchmark for discussions about these difficult issues. Enough by flame throwers who seem to revel in the misery of others, obvious examples of which can easily be found at other law professor blogs.

[cas127]

"I am interested in which law schools are already laying off professors."

Hmmm.

Sounds like a very good time for "somebody" to set up a "Law School Death Watch" blog.