The ABA Journal has an article entitled "When the Detour Becomes the Destination
How 5 grads survived a recession—and how you can too". The article gives several examples of lawyers that launched their careers during the last legal recession during the early 1990s. The article is an attempt to be inspirational and give hope to those law students that are struggling to find jobs during the current recession. That's a sentiment that I applaud. However, I don't think a straight comparison of the early 1990s recession with the current recession paints an accurate picture of the employment situation - and that does a disservice to current law students and those considering entering law school. We take a more detailed look at the assumptions and likely outcomes below.
First, we note that the early 1990s recession only lasted eight months - from July 1990 to March 1991. That's shorter and milder than the typical recession. Conversely, the current economic downturn is generally regarded as beginning in December 2007 - which means that it's been going on for 24 months now. That's already 3 times the length of the 1990s recession. The current recession is also much more severe in terms of overall job loss and stock market decline.
Next, as cited in the ABA's article, during the 1990s recession employment after graduation fell from 92.2% in 1987 to 83.4% in 1993 - that's a significant 9% decline. However, even these employment numbers paint an inaccurate picture. For example, when a regular person reads that 83.4% of law school graduates were employed after graduation, they typically assume that the graduates were employed - AS LAWYERS. Unfortunately, that's not the case here as we will explore more below.
In this regard, at the bottom of the article is a handy chart provided by NALP that lists percentages "employed legal full time" and "jobs in law firms". We note that "employed legal full time" is "any full-time job in a legal field." Are you forced to work as a paralegal? Are you working for the law school? These would probably count. Further, as we have previously noted here, even NALPs numbers are most likely biased higher by reporting bias. That is, NALP relies on voluntary disclosure, and if someone is embarrassed about not having a job then they just don't send in the form and they are not counted and don't appear in the statistics.
To me, the most important number to track in this chart is the percent hired by law firms. We note that the number peaks in 1988 at 64.3%, but by the worst part of the depression in 1994 the percent hired by law firms has declined to 55%.
However, one telling tidbit of data is that by 2008 - BEFORE the most recent recession and its huge impact on employment -the percent hired by law firms had only risen to 56.2%. Yes, you read that right - even BEFORE the most recent recession, about HALF of the law school class did not get a job in a law firm.
Also, we note that from 1993 -1995 about 30% of the law students didn't even get a full-time job in the legal field.
What's The Impact?
The early 1990s recession was mild, but even with only a mild recession, about 30% of law students were not able to obtain a full-time legal job, and only about half were able to get a job in a law firm.
However, the current recession is much deeper, consequently I would not be surprised to see the percentage of law graduates working in a full-time legal job fall to 50%, and the percentage working in a law firm decline to 35%.
A comparison of the declines brought about by the mild 1990s recession seems to bear this out. We note that due to the 1990s recession the percentage working in a legal field declined from 84.5 in 1988 to 69.6 in 1994, a difference of 15.5%.
Conversely, in 2008 the percentage working in a legal field was 74.7%. Applying the percentage decline from the 1990s recession of 15.5% yields a result of only 59.2% of graduates working full time in a legal career. However, we note that the current recession is much worse than the 1990s recession. Consequently, this number is likely to be far too optimistic.
What's the best number? Well, even though the current recession has lasted three times as long, I don;t think tripling the 15.5% decline is right. That would result in only 28.2% of law students obtaining a full-time legal related job. That seems too low.
One interesting aspect that would be good to check is whether there was the tremendous influx of law students in the early 1990s like we are having now. That is, as you know, right now law school applications are way, way up - as high as 62% in some cases. Also, there was a recent 20% increase in people taking the LSAT. Conversely, what was the activity during the 1990 recession? If law students went even crazier than now, then maybe we will not see as much of a decline. However, if potential law students in 1990 did not jump on the law school bandwagon as much as potential law students are now, then maybe the decline that we will see now will be even greater.
Regardless, if you are thinking of going to law school right now, please be aware that even under the most optimistic scenario only about 59.2% of law students will get a full-time legal job at graduation. Further, a less optimistic projection may push the percentage to only 50%, or even below. Even worse, employment in law firms is likely to only be around 40%.
Please carefully evaluate whether it is worth accumulating the huge mountain of debt required to pay for law school when the prospects of a full-time job in the legal field at graduation are so minimal. Even if attending law school is a life-long dream for you, you may wish to delay your entry date to a time when supply and demand are more in balance. Good luck!