It seems that the story is a that a once upwards spiral is now spiraling downwards, and people and institutions must adjust.
At one point in time, law was lucrative, and there were not enough lawyers. Schools responded by growing in size and in tuition. Students could justify the loans because there was a high chance that the "investment" would pay off.
Fast forward a few decades and law as an industry is contracting. Since the profession is not as lucrative, if you follow the chain, then schools should have contracted in response, minting fewer lawyers. But they can't easily adjust when they've built a bureaucracy and dramatically increased the number of tenured faculty. That lead to them misleading applicants by not having transparency with their true employment numbers. For a while, students were duped. But at this point, the cat is largely out of the bag. Applicants numbers are down, and the demise of debt-burdened law grads have hit national headlines numerous times over the last 5 or so years. So now, in uncoordinated fashion, schools must adjust and finally down size. Too bad students were caught in the crossfire for many years before the flares went up.
The size of the legal market is the same as it was in 1990, and so is law school enrollment. There was a spike in both legal demand and enrollment in the aughts, but the ratio of work to graduates isn't much different now than it was in the 1980s and 1990s.
What's different now is not the market. Folks at Valparaiso were never getting recruited into high-paying jobs. What's different now is the extreme amounts of debt. And that phenomenon that's not confined to law. The whole education sector is overblown by irrational pro-education rhetoric and free flowing federal money.
Exactly right. The easy money available through student loans has completely distorted the market pressure that would normally keep tuition and fees more in line with demand.
> The whole education sector is overblown by irrational pro-education rhetoric and free flowing federal money.
It's worth mentioning that you'd have been downvoted into oblivion for mentioning this on a social network just several years ago. This was also true offline, people didn't want to hear it.
One thing I think is interesting here is the uncontrolled growth in costs. Paul Campos of Lawyers, Guns, and Money posted the average private-school law tuition [1]:
All figures have been adjusted to constant 2016 dollars:
1956: $4,178
1974: $11,232
1985: $16,803
1995: $26,480
2005: $35,550
2015: $45,123
It's funny because you look at these figures, you look at real estate prices, you look at stock prices, and you think, wait we are in a double digit inflationary environment!
Actually what is inflationary is the activities of the middle/upper-middle class (college, housing, stocks, etc), which are of course underrepresented in the CPI indices. The combination of the never ending debt bubble and quantitative easing has created a very localised inflation.
The distribution of salaries in law is bimodal. Lawyers at the school mentioned have never commanded big law levels of compensation. The information is readily available, and it is why I chose not to attend a top 20 law school in 2007.
Where are the huge numbers of $160,000 salaries coming from? It's like a delta function right at that one level. Is that a standard starting package for major firms?
Yes, it's the standard package for "BigLaw." There used to be a database on Greedy Associates that showed the salary progression for each firm, but I can't seem to find it. They tend to move in lockstep with each other.
Graduates of the top 14 schools per US News and World Report rankings feed into these jobs. Some at lower ranked tier 1 schools end up in big law, but they are typically at the top of the class. I would bet that not a single student of the law school mentioned in the article ended up in with a $160k starting salary.
It's tempting to counter by citing the "lucrative" special case: The top 5-10% of T14 law schools who receive entry-level associate salaries of $160K/year base + bonus.
However, pricing power appears limited, creating a ceiling on wage increases. To this point, Vault100 firms have recently trickled out pay increases to $180K/year for incoming associates. Clients have laughed and said, "Good for your employees, but you're not passing those costs onto us!" [0]
lucrative is also a relative term, since they are often working 2000 billable hours a year (which, depending on type of work/attorney, may be 60% to 90% of actual hours worked per year)
In biglaw, i have friends who easily work 2500-3000 hours a year to make their billable hours requirement.
So these salaries are not exact as great as one would think anyway
I'm familiar with the sum($)/sum(hours) =< minimum wage arguments. We're also talking about the top 1% of 1% of wage earners in their age bracket. You might be able to get there via other means with better quality-of-life, but by all means -- absolute or relative -- $160K/year base + bonus is lucrative.
And $160k-$180k is first year salary, which is bumped up automatically until the seventh year, at which point the associate is making $280k-$315k salary. If they then make partner, they'll make much more.
I would argue, pretty strongly, many engineers do not work similar hours (or work at such "efficiency") in as stressful a way as the lawyers are working.
Of course, I don't argue doing such a thing is necessary or even useful to being a good engineer, just that i think you are giving pretty short shrift to the other side of this :)
Perhaps a lawyer's working hours tend to be more "efficient" or more stressful. My interaction has been primarily limited to in-house patent attorneys, and they don't seem to work appreciably harder or be more stressed out.
Work-related stress is a big issue. Regardless, putting in long hours at work, regardless of stress level, means less time for family, friends, hobbies, recreation, exercise, sleep, etc.
yes, but (and I'm biased), it seems plausible that a higher percentage of engineers enjoy a larger fraction of their work than law associates. I have no numbers to back this up, but very few people pick up corporate law as a hobby.
There is no way that $195k ($180k + $15k) is the top 1bps of wage earners at 26. That's pretty comparable to, if not less than, what you could expect in tech at that age. This is ignoring finance, small business owners, etc.
What planet do you live on? $195k is WAY above the average salary for a programmer. Only in SV or other super-hot markets will a 26 year old command a salary that high, and even then, only if they're amazing at their job. Most places, you're looking at $70-$100k.
Not that relevant to the argument, but you're right that the numbers are way off. For a 26-year-old, $200k is in the top 1%, but probably not in the top 0.1% (and definitely not top 0.01%). I don't know anything about tech salaries, but there are lots of 26-year-olds making that much in finance (total comp, not salary).
I think it is relevant because I would be willing to take a quality of life hit to be in the "top 1% of 1%" that I wouldn't take to make $200k. I make more than $200k, but I suspect that I'm nowhere close to the top 1 bps.
It's talking about someone in Indiana who is not making the kind of money that GP mentioned.
> Yet in financial terms, there is almost no way for Mr. Acosta to climb out of the crater he dug for himself in law school, when he borrowed over $200,000. The government will eventually forgive the loan — in 25 years — if he’s unable to repay it, as is likely on his small-town lawyer’s salary. But the Internal Revenue Service will probably treat the forgiven amount as income, leaving him what could easily be a $70,000 tax bill on the eve of retirement, and possibly much higher.
>There is no way that $195k ($180k + $15k) is the top 1bps of wage earners at 26. That's pretty comparable to, if not less than, what you could expect in tech at that age.
First you can not say a person works "in tech" any more like you can with Legal. The Information Technology industry has sooo many different Job Classification today that you can not longer loop everyone that "works in tech" together. Not even all programmers or administrators can be looped together anymore IMO. However there is 3 Basic area's of information technology that you might be able to Group together. Support, Administration, Development...
That said like the legal Field, Technology has also be decimated, H1B, "The Cloud", the rise of MSP model @ the expense of Internal IT and other issues are massively lowering the wages
So while a person @26 working for a Top Silicon Valley Company (apple, Amazon, Google, etc) as a High level Programmer, might get 195K, I do not believe you can say a person at 26 should "expect" to get 195K far far far far far from it.
If they are in Operations/Administration, you are looking at 40-70K nation wide, if you are in programming a little more, if you are In Repair or "HelpDesk" a little to much less..
Specialty Area's like DBA or Senior Linux Admin can command those high pay levels in select regions as well.
And this is what's wrong with the law profession generally. It's seen as "lucrative" instead of as "a calling." No modern law school will ever create an Oliver Wendell Holmes or inspire a fictional Atticus Finch.
I see where you're coming from, but most people work for a paycheck rather out of higher level motives (like "I was meant to be doing this"). By the same measure, all professions would be "wrong".
Some professions (lawyer, doctor, law enforcement, clergy) should have as a fundamental motive the desire to help people rather than profit, since they have by their very nature the power to help or harm others.
In US it is becoming increasingly difficult to dedicate yourself to a cause. Since no one has your back you have to fend for yourself and your family. Good affordable healthcare, education, daycare, e.t.c. is not a given and they dedicate their lives to tend to their families and service their debts.
PS: I assume you are comparing with Sweden
Not true: many lawyers work entire careers in the human rights field. Many modern law schools have produced these types of lawyers. It's just not as glamorous as what people have in mind for a lawyer, and thus not as publicized.
Yes, but the debt required to do that kind of work is completely unsustainable. 150-200k debt to service on a 60k salary working in human rights. Only with family help or huge sacrifice
"employment numbers?? you should be in school for the pursuit of knowledge no matter what your socioeconomic situation happened to be, this clearly applies to everyone"
At one point in time, law was lucrative, and there were not enough lawyers. Schools responded by growing in size and in tuition. Students could justify the loans because there was a high chance that the "investment" would pay off.
Fast forward a few decades and law as an industry is contracting. Since the profession is not as lucrative, if you follow the chain, then schools should have contracted in response, minting fewer lawyers. But they can't easily adjust when they've built a bureaucracy and dramatically increased the number of tenured faculty. That lead to them misleading applicants by not having transparency with their true employment numbers. For a while, students were duped. But at this point, the cat is largely out of the bag. Applicants numbers are down, and the demise of debt-burdened law grads have hit national headlines numerous times over the last 5 or so years. So now, in uncoordinated fashion, schools must adjust and finally down size. Too bad students were caught in the crossfire for many years before the flares went up.