Post-law school employment in the United States

From Wikipedia, the free encyclopedia
Jump to navigation Jump to search

Post-law school employment in the United States reflects the extent to which students who obtain a law degree after attending law school in the United States are able to find employment which pays well enough to enable them to at least recoup the costs of their degrees.

Employment statistics and salary information[edit]

According to the Employment Summary Report prepared by the ABA's Section on Legal Education, around 86% of recent law graduates were employed 9 months after graduation, but only 62% of U.S. law school graduates who graduated in May 2016 were employed in full-time, long term positions that required a law degree.[1] This is consistent with findings in labor economists Michael Simkovic and Frank McIntyre's peer-reviewed study of U.S. Census Bureau data from 1996 to 2013, The Economic Value of a Law Degree which found that 40 percent of law school graduates do not practice law.[2]

The National Law Journal compiles employment information tracking the proportion of recent graduates working in the 250 largest law firms in the country.[3] Although relatively few law graduates obtain these highly paid positions, law graduates, even graduates of low-ranked law schools, have much lower student loan default rates than average according to data from the U.S. Department of Education.[4]

Professor Simkovic & McIntyre's study found that law graduates who do not practice law still derive substantial benefits from their law degrees. Law graduates earn around $30,0000 to $60,000 more per year than they likely would have been had they never attended law school. Unemployment and underemployment rates are higher for similar undergraduates than for law graduates. Long term earnings data is available from the U.S. Census Bureau's Survey of Income and Program Participation, a nationally representative survey first used to measure law degree holder earnings premiums in a widely cited study by Simkovic and McIntyre.[5]

A separate study of law graduates earnings sponsored by the American Bar Foundation and National Association for Law Placement, "After the JD", came to substantially similar conclusions. "After the JD II" and "After the JD III" found that law graduates, even from low ranked law schools, typically had six figure incomes within 12 years of graduation and made substantial progress toward paying down their debts.[6][7]

A working paper by University of Chicago economics graduate student David Burk used another Census data source and came to conclusions broadly similar to those of Simkovic & McIntyre and After the JD.[8]

Some critics, such as Brian Tamanaha, questioned whether a law degree would continue to provide similar benefits to law graduates who graduated during a recession.

Subsequent peer reviewed research by McIntyre and Simkovic using U.S. Census data and "back testing" investigated differences in earnings premiums between law school graduates graduating into strong and weak economies to try to better understand the impact of the 2008-2009 recession. Simkovic & McIntyre found that over the course of a lifetime, the differences were too small to sway the decision about whether or not law school was a good financial investment.[9][10][11][12][13] Even for those graduating into high unemployment and close to the bottom of the earnings distribution, a law degree still typically provided greater benefits than it cost. The second Simkovic & McIntyre study also found that current unemployment does not predict future unemployment in 3 or 4 years when those currently entering law school would graduate.[14]

Subsequent research by McIntyre and Simkovic investigated variability in earnings for law graduates by college major and race.[15][16] These studies found that law degrees tend to benefit humanities majors more than STEM majors and tend to benefit whites more than unrepresented minorities. However, the benefits to STEM majors and minorities still usually exceed the costs of law degrees.

In 2010, law professor Brian Tamanaha had questioned the accuracy of employment statistics provided by some law schools to the National Association for Law Placement and the American Bar Association.[17] He noted that employment and salary information provided by law schools was based on surveys of recent graduates. This information is consolidated and made available by the American Bar Association.[1] In his book entitled "Failing Law Schools," Tamanaha explained that he would advise members of his own family against attending the law schools where he has taught because they are too expensive relative to the financial benefits they provide.[18]

Labor Economist Frank McIntyre and Michael Simkovic criticized Professor Tamanaha's research, noting it had factual errors, misleading and selective citations to sources that contradicted the proposition for which Tamanaha cited them, and inappropriate and misleading uses of data.[19] However, Simkovic and McIntyre praised Tamanaha for his lively writing style and creative policy proposals.

Lifetime value of a law degree[edit]

According to a peer reviewed study published in the University of Chicago's Journal of Legal Studies and authored by labor economists Michael Simkovic and Frank McIntyre, a law degree increases lifetime earnings by $1,000,000 compared to a bachelor's degree.[20][21][22][23][24] This is present value, as of the start of law school, and includes opportunity costs and financing costs. After taxes, the mean present value will be around $700,000. At the median, or 50th percentile, the pretax present value is $610,000 and the after tax value is $430,000. After tuition, the median law graduate becomes around $330,000 richer. Even toward the bottom of the distribution, the value of a law degree will typically exceed its costs by hundreds of thousands of dollars.[25]

According to the United States Department of Labor, Bureau of Labor Statistics, the national average salary for lawyers in 2016 was $140,000.[26] Salaries vary by geography, with higher average salaries in big cities—especially New York, Washington D.C., Chicago, and Los Angeles—and lower salaries in rural areas. An unpublished table produced by the U.S. Bureau of Labor Statistics shows that unemployment rates among experienced lawyers are lower than those for most high-income occupations.[27] BLS data also suggests that lawyer employment has grown slightly faster than other occupations, with lawyers comprising a growing share of the work force over the last decade.

BLS figures exclude law firm partner profits. Profits per partner at the 200 largest law firms by revenue are reported by the American Lawyer magazine in its AmLaw 100 and AmLaw 200 rankings. According to American Lawyer, profits per partner at these firms have ranged from around $300,000 at the least profitable to $5,000,000 at the most.[28]

Not all law school graduates work as lawyers. According to Simkovic and McIntyre's study of U.S. Census Bureau data, around 40 percent of U.S. residents with law degrees do not practice law.[29]

Law graduates are disproportionately represented in leadership positions in business and government.[30] The National Association for Legal Career Professionals produces an annual report summarizing the employment of recent graduates of U.S. law schools at a single point in time, 9 months of graduation. Employment at that point is typically around 90 percent, although from 2009 to 2011, the numbers were lower, at around 86 to 88 percent.[31] Approximately 2 percent of graduates were employed in non-professional jobs.[31] Approximately 75 to 85 percent work in jobs classified by NALP as "JD required" or "JD preferred", and another 5 percent work in other professional jobs.[31] A law degree increases earnings, even including those who do not practice law.[32]

Because federal tax rates are around 30 percent, and the mean value of a law degree is $1,000,000, the benefit to the federal government's budget is on average $300,000 per law student.[33] In addition, student loans to law students are profitable because of low default rates relative to other degree programs, high interest rates on loans to graduate students, and high recovery rates on defaulted loans.[34] Default rates on loans to law students were low both before and after the availability of programs such as Income Based Repayment.[35]

McIntyre and Simkovic report that the expected value of a law degree is different depending on college major,[36] economic conditions at graduation,[37] and race.[38]

Lawsuits related to American legal education[edit]

In 2011, several law schools were sued by plaintiffs who alleged fraud and misleading job placement statistics. Most of these suits have been dismissed on the merits.[39][40][41][42] In December 2016, students of the for-profit Charlotte Law School filed a class action lawsuit against the school, alleging among other things that Charlotte had failed to inform them that it was at risk of losing its access to federal student loans.[43]


  1. ^ a b
  2. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014). "Our analysis of Survey of Income and Program Participation (SIPP) data suggests that about three of five law school graduates work as lawyers"
  3. ^ National Law Journal To Go to Law School rankings
  4. ^
  5. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  6. ^ After the JDIII
  7. ^ After the JII
  8. ^ David Burk, Returns to Legal Education, 2014
  9. ^ Frank McIntyre & Michael Simkovic, Timing Law School, 14 J. Empirical Legal Stud. 258–300 (2017).
  10. ^ Frank McIntyre & Michael Simkovic, Timing Law School (2015)
  11. ^ Steven Davidoff Solomon, Law Schools and Industry Show Signs of Life, Despite Forecasts of Doom, N.Y. Times Dealbook, March 31, 2015
  12. ^ Debra Cassens Weiss, Why time law school? Value of law degree drops only $30K in bad vs. good economy, study says, ABA Journal, Mar. 10, 2015
  13. ^ Karen Sloan, Study: Law Grads’ Earning Advantage Seems Recession-Proof, The National Law Journal, March 10, 2015
  14. ^ Michael Simkovic, The Perils of Prediction, Brian Leiter's Law School Reports, March 19, 2015
  15. ^ Michael Simkovic & Frank McIntyre, Value of a Law Degree by College Major (2016)
  16. ^ Frank McIntyre & Michael Simkovic, Are Law Degrees as Valuable to Minorities?, International Review of Law & Economics (2017)
  17. ^ Brian Tamanaha, Failing Law Schools, University of Chicago Press, 2012
  18. ^ Tamanaha, Brian Z. (2012-06-18). Failing Law Schools (Chicago Series in Law and Society) (Kindle Locations 3413-3414). University of Chicago Press. Kindle Edition.
  19. ^ Michael Simkovic & Frank McIntyre, Populist Outrage, Reckless Empirics: A Review of Failing Law Schools, Northwestern University Law Review, Feb. 3, 2014, "Archived copy". Archived from the original on 2014-10-06. Retrieved 2014-09-30.
  20. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  21. ^ Steven M. Davidoff, Debating, Yet Again, the Worth of Law School, N.Y. TIMES DEALBOOK, July 18, 2013
  22. ^ Dylan Matthews, Ignore the haters. Law school is totally worth the cash, WASH. POST, July 18, 2013
  23. ^ Jordan Weissmann, Is Law School a Good Deal After All?, THE ATLANTIC, July 19, 2013
  24. ^ Brian Leiter, Reflections on The Economic Value of a Law Degree and the Reactions to It, Brian Leiter's Law School Reports, July 30, 2013
  25. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  26. ^ United States Department of Labor, Bureau of Labor Statistics, Occupational Employment Statistics, Lawyers
  27. ^ Tableau, Who's got the Biggest Salary
  28. ^ American Lawyer
  29. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  30. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  31. ^ a b c National Association for Law Placement
  32. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  33. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  34. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  35. ^ The Economic Value of a Law Degree, 43 J. Legal Stud. 249 (2014)
  36. ^ McIntyre, Frank; Simkovic, Michael (2016). "Value of a Law Degree by College Major". Social Science Research Network.
  37. ^ McIntyre, Frank; Simkovic, Michael (2016). "Timing Law School". Social Science Research Network.
  38. ^ McIntyre, Frank; Simkovic, Michael. "Are law degrees as valuable to minorities?". International Review of Law & Economics. doi:10.1016/j.irle.2017.09.004.
  39. ^ The Wall Street Journal (PDF) Missing or empty |title= (help)
  40. ^
  41. ^
  42. ^
  43. ^ "CLS students file class action lawsuit".