Lawyers Need Work
Can lawyers find jobs in today’s market? The Wall Street Journal (page 1, Sept. 24, 2007) suggests that it’s not so easy today. That’s consistent with my earlier blog post that lawyers are “between a rock and a hard place.”
It is also consistent with my assertion that law is a business, or framed in the context of my registered trademark, The Business of Law® is governed by the principles of economics. Yes, law is a profession, but as Tower Snow, once managing partner of the former Brobeck, Phleger & Harrison law firm in San Francisco said, “Law is subject to the same laws of economics as any other business…”
The journalist lists supply and demand information that is impacting the profession today:
Slack in demand:
• Growth rate is down to 1.2% since 1988, less than half as fast as the general economy
• Decline in some practice areas such as personal injury and medical malpractice (resulting from state laws limiting class action lawsuits) and securities class actions (resulting from a rising stock market)
Increase in supply:
• Influx of applicants after the dot-com bust (43,883 J.D. degrees were awarded in 2006 compared to 37,909 for 2002)
• Increase in accredited law schools (11% since 1995) because they make money for their universities
Further, income for the top 25% of lawyers grew 22% between 1975 and 1995, according to one study, while the income of the remaining 75% declined! And, according to the IRS, income of sole practitioners has remained flat since 1985!
The WSJ article doesn’t discuss the continuing issue of large unmet legal needs of lower income and middle income Americans. Meeting those needs, however, will require an organized effort, one neither the government nor the organized Bar seem to want to address. Certainly, the individual lawyer cannot reach out on his/her own to address these needs.
And so, like every other business, there is likely to be a fall-out where the profession will have an economic dislocation for awhile and then come back into harmony with the demand. In the meantime, many lawyers will either have to do contract work at low wages for larger law firms or find work in other professions or trades. This will be painful, to be sure, for those who will suffer both economically (remember those student loans still have to be paid!) as well as psychologically.Tags: Cash Flow - Finances, Management, Personal Thoughts