2017 Employment Market Number Crunching - Looks Good To Me Forum

[bugsy33]

Someone tell me why I'm wrong with these numbers for the prospective class of 2017.

Class of 2017: 37,924
Total LTFT Bar Passage Required Jobs Class of 2014:26,248

If the market does not improve AT ALL, and every single person who enrolled graduates and passes the bar, then the employment rate should be around 70% for the c/o 2017.

If we factor in that historically only 88%ish of law school students graduate (33,373), and if all of those kids pass the bar the employment rate will be around 79% with a stagnant market.

If we factor in the expected graduation rate, and a modest market increase (3%)(27,035 jobs for 2017), we're looking at an 81% employment rate.

Now, if we only count expected grads who pass the bar on the first try (84% national average of 33,373 = 28,033).

So if you graduate law school, pass the bar, and the economy improves even a teeny-tiny bit, the market should absorb 96% of 2017 law grads.

Even if you say that there's a glut of unemployed lawyers from previous classes, the total FTLT job number I'm basing these numbers off is from the class of 2014, which would also be experiencing the same problem.

Why am I wrong?

Disclaimer: 0Ls reading this, this is not an endorsement of law school. Even with full employment most of the jobs still suck and you will be in a ton of debt. Do not go to law school.

[Robb]

You assume

1) Job market doesn't shrink due to economy
2) Job market doesn't shrink in response to decreased supply of graduates
3) Job market for recent graduates doesn't shift to non-recent graduates in response to decreased supply of graduates

But besides that, I don't think you're wrong, and I doubt any of these factors, except, perhaps, the third, will have a significant impact on your analysis.

Boomers retiring might even amplify the effect, perhaps substantially.

[prezidentv8]

[stuff]

Why am I wrong?

[rather proper disclaimer]

Salaries. Also, debt.

[rpupkin]

Someone tell me why I'm wrong with these numbers for the prospective class of 2017.

Class of 2017: 37,924
Total LTFT Bar Passage Required Jobs Class of 2014:26,248

If the market does not improve AT ALL, and every single person who enrolled graduates and passes the bar, then the employment rate should be around 70% for the c/o 2017.

If we factor in that historically only 88%ish of law school students graduate (33,373), and if all of those kids pass the bar the employment rate will be around 79% with a stagnant market.

If we factor in the expected graduation rate, and a modest market increase (3%)(27,035 jobs for 2017), we're looking at an 81% employment rate.

Now, if we only count expected grads who pass the bar on the first try (84% national average of 33,373 = 28,033).

So if you graduate law school, pass the bar, and the economy improves even a teeny-tiny bit, the market should absorb 96% of 2017 law grads.

Even if you say that there's a glut of unemployed lawyers from previous classes, the total FTLT job number I'm basing these numbers off is from the class of 2014, which would also be experiencing the same problem.

Why am I wrong?

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

[Cobretti]

You assume

1) Job market doesn't shrink due to economy
2) Job market doesn't shrink in response to decreased supply of graduates
3) Job market for recent graduates doesn't shift to non-recent graduates in response to decreased supply of graduates

But besides that, I don't think you're wrong, and I doubt any of these factors, except, perhaps, the third, will have a significant impact on your analysis.

Boomers retiring might even amplify the effect, perhaps substantially.

lolwut

lower supply =/= lower demand

More broadly though, yes things are looking really solid right now. We are the lucky ones (for now).

[rahulg91]

3) Job market for recent graduates doesn't shift to non-recent graduates in response to decreased supply of graduates

Why do people keep bringing this argument up? I feel like it was started by some hopeful dude who struck out or got no-offered during the recession. Hasn't the traditional biglaw hiring model always been to hire out of law schools (and take laterals)? Why would they decide to shift all of a sudden?

[banjo]

This is an interesting analysis. In practice, though, people are looking for jobs in the jurisdiction where they took the bar. For the average Cardozo grad, the New York market matters a lot more than the national market.

[BigZuck]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

This guy. This guy gets it.

[dixiecupdrinking]

I think there may have been something of an overcorrection thanks to extensive mainstream media coverage of THE LAW SCHOOL SCAM.

If one is going to go to law school—and, to be clear, one probably should not; I cosign your disclaimer 100%—this is probably the best time to do it in over a decade.

ETA: I realized I referred to a situation in which there are almost enough jobs for graduates as an "overcorrection." Just goes to show how much I've internalized the idea that it's just the way it is that most law graduates don't get jobs.

[84651846190]

Tuition is still increasing much faster than inflation. Salaries haven't budged (or maybe have even gone down) over the last 7-8 years.

[dixiecupdrinking]

Tuition is still increasing much faster than inflation. Salaries haven't budged (or maybe have even gone down) over the last 7-8 years.

That's a good point. But when was a better time to go in the last decade? People who enrolled in 2005 were just starting their first jobs when Lehman collapsed. The next couple years were terrible. And people starting now, I gather, are getting into better schools/better scholarship offers than comparable candidates were ~5 years ago because enrollment's down. So I take your point but I still stand by mine.

[Robb]

You assume

1) Job market doesn't shrink due to economy
2) Job market doesn't shrink in response to decreased supply of graduates
3) Job market for recent graduates doesn't shift to non-recent graduates in response to decreased supply of graduates

But besides that, I don't think you're wrong, and I doubt any of these factors, except, perhaps, the third, will have a significant impact on your analysis.

Boomers retiring might even amplify the effect, perhaps substantially.

lolwut

lower supply =/= lower demand

More broadly though, yes things are looking really solid right now. We are the lucky ones (for now).

Well, it depends, really. Say, for example, 10% of grads are employed by their uncle who adds a position in his small law firm just for them. In that case, lower supply would lead to lower demand. Realistically, the lower supply derives from the upper echelon of would-be law students foregoing school. That is, the rich kids whose parents have connections in biglaw to help them get a job. There's also the possibility that the demand is not actually there-that all these lawyers are not actually necessary, but a form of numbers boosting or some similar thing, and instead of hiring less qualified candidates (because those students don't serve the same purpose of boosting positive numbers like "number of associates from Yale") employers will hire less. Whether that's actually the case, I can't say. But I think you're right, the effect is probably minimal to nonexistent.

3) Job market for recent graduates doesn't shift to non-recent graduates in response to decreased supply of graduates

Why do people keep bringing this argument up? I feel like it was started by some hopeful dude who struck out or got no-offered during the recession. Hasn't the traditional biglaw hiring model always been to hire out of law schools (and take laterals)? Why would they decide to shift all of a sudden?

Oh, I didn't know this was a classic argument that's made. In any case, I don't know about biglaw hiring practices except as I have experienced them, but biglaw hires are only a small portion of overall hires.

[mr.hands]

OP, you're (somewhat understandably) oversimplifying this

First, projecting 2-3 years in advance (for anything) is a risky proposition. Currently, things are looking good. That doesn't mean a whole lot necessarily. Even if the job market doesn't tank by the time you graduate, it still might a year or two later (in which case, you'd be a year or two out of law school and jobless). See, e.g., Class of 2005.

Second, be sure to calculate the total COA with tuition increases over the next 3 years. Currently, tuition is insane. With 4% increases, it'll be even worse. Given that law school isn't a great investment now, it might be even worse in a few years. Sticker prices at top schools will easily exceed 300k. Even with a scholarship, tuition is insane.

The bottom line is that, sure, law school is a better proposition than it has been in recent years. Job prospects are improving. Whether law school is a *good* investment, though, is an entirely different consideration

[bugsy33]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class. T1 schools accounted for 5,474 of that number. There are 11,626 c/o 2017 T1 students. Apply arbitrary heightened standards (95% graduation rate and 95% bar pass rate) = 10,492 will graduate and pass the bar. That would give T1 students a 52% shot at BigLaw and FedClerk assuming a stagnant market. Obviously these numbers will be heavily skewed towards the top-14, but still. I also think that most signs are indicating that BigLaw hiring is increasing. C/O 2014 went through OCI in 2012, I would imagine OCI in 2015 will take larger classes.

So yeah, looking pretty good still.

EDIT: For outside the T-15, there were 1,985 BL+FC jobs for 2014. There are 6,965 enrolled in C/O 2017 outside the T-15. Same analysis (1,985/6,286) = 32% BL+FC absorption potential at 15-50 schools.

[rpupkin]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class. T1 schools accounted for 5,474 of that number. There are 11,626 c/o 2017 T1 students. Apply arbitrary heightened standards (95% graduation rate and 95% bar pass rate) = 10,492 will graduate and pass the bar. That would give T1 students a 52% shot at BigLaw and FedClerk assuming a stagnant market. Obviously these numbers will be heavily skewed towards the top-14, but still. I also think that most signs are indicating that BigLaw hiring is increasing. C/O 2014 went through OCI in 2012, I would imagine OCI in 2015 will take larger classes.

So yeah, looking pretty good still.

I soooooo want to write "NYC to 190 confirmed," but I didn't actually understand any of that. Could someone smarter than me please translate and confirm?

[Cobretti]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class. T1 schools accounted for 5,474 of that number. There are 11,626 c/o 2017 T1 students. Apply arbitrary heightened standards (95% graduation rate and 95% bar pass rate) = 10,492 will graduate and pass the bar. That would give T1 students a 52% shot at BigLaw and FedClerk assuming a stagnant market. Obviously these numbers will be heavily skewed towards the top-14, but still. I also think that most signs are indicating that BigLaw hiring is increasing. C/O 2014 went through OCI in 2012, I would imagine OCI in 2015 will take larger classes.

So yeah, looking pretty good still.
NYC to 190

I soooooo want to write "NYC to 190 confirmed," but I didn't actually understand any of that. Could someone smarter than me please translate and confirm?

[Anonymous User]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class. T1 schools accounted for 5,474 of that number. There are 11,626 c/o 2017 T1 students. Apply arbitrary heightened standards (95% graduation rate and 95% bar pass rate) = 10,492 will graduate and pass the bar. That would give T1 students a 52% shot at BigLaw and FedClerk assuming a stagnant market. Obviously these numbers will be heavily skewed towards the top-14, but still. I also think that most signs are indicating that BigLaw hiring is increasing. C/O 2014 went through OCI in 2012, I would imagine OCI in 2015 will take larger classes.

So yeah, looking pretty good still.

I soooooo want to write "NYC to 190 confirmed," but I didn't actually understand any of that. Could someone smarter than me please translate and confirm?

Maybe I'm misunderstanding, but I think the argument is: (1) more people are getting Biglaw+FedClerk, (2) law school class sizes are shrinking, (3) legal hiring (at least BigLaw) has increased somewhat in recent years, and so (4) a larger percentage of future classes will get BigLaw+FedClerk. Is this semi-correct?

[Cobretti]

Please explain how this equates to a first-year associate salary of $190,000 per twelve-month period in the city of New York. Thank you in advance.

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class. T1 schools accounted for 5,474 of that number. There are 11,626 c/o 2017 T1 students. Apply arbitrary heightened standards (95% graduation rate and 95% bar pass rate) = 10,492 will graduate and pass the bar. That would give T1 students a 52% shot at BigLaw and FedClerk assuming a stagnant market. Obviously these numbers will be heavily skewed towards the top-14, but still. I also think that most signs are indicating that BigLaw hiring is increasing. C/O 2014 went through OCI in 2012, I would imagine OCI in 2015 will take larger classes.

So yeah, looking pretty good still.

I soooooo want to write "NYC to 190 confirmed," but I didn't actually understand any of that. Could someone smarter than me please translate and confirm?

Maybe I'm misunderstanding, but I think the argument is: (1) more people are getting Biglaw+FedClerk, (2) law school class sizes are shrinking, (3) legal hiring (at least BigLaw) has increased somewhat in recent years, and so (4) a larger percentage of future classes will get BigLaw+FedClerk. Is this semi-correct?

+demand
-supply
----------
$$$$

[Tiago Splitter]

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class.

Where did you see that number? And why would it increase? The market is hot as hell and yet that number is lower than the class of 2013 saw.

[Nomo]

At this point, tuition is a bigger problem than the job market. Biglaw doesn't pay enough to justify 50k in tuition. And its going to be 60k before too long.

[bugsy33]

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class.

Where did you see that number? And why would it increase? The market is hot as hell and yet that number is lower than the class of 2013 saw.

ABA data. Sure the number may be lower, but that can be attributed to latency within the hiring market. The biglaw hiring structure necessitates at least a two year reaction time. So maybe this will be the year OCI gets hot...or not. Who knows, but I highly doubt it's going to be lower than OCI 2012.

[Tiago Splitter]

At this point, tuition is a bigger problem than the job market. Biglaw doesn't pay enough to justify 50k in tuition. And its going to be 60k before too long.

lol more like 70k. We already got 60k on lockdown

[Tiago Splitter]

I will try. Biglaw + FedClerk for 2014 was 6,767 total. If that holds (I think it will increase), then that's 24% of the total 2017, bar passing, graduating class.

Where did you see that number? And why would it increase? The market is hot as hell and yet that number is lower than the class of 2013 saw.

ABA data. Sure the number may be lower, but that can be attributed to latency within the hiring market. The biglaw hiring structure necessitates at least a two year reaction time. So maybe this will be the year OCI gets hot.

What was the 100+ hiring number? Going back to 2010 it was 5600, 4700, 5600, 6100. I assumed it would keep going up for class of 2014 so if it didn't that's kind of disappointing. I'm using NALP data for this btw but that should be the same.

[bugsy33]

At this point, tuition is a bigger problem than the job market. Biglaw doesn't pay enough to justify 50k in tuition. And its going to be 60k before too long.

lol more like 70k. We already got 60k on lockdown

But who is actually paying that? You'd have to be an idiot to go at sticker outside the T-15. Most schools are heavily discounting now. I think it's more common for people to be paying 20k a year than 50k a year.

[bugsy33]

What was the 100+ hiring number? Going back to 2010 it was 5600, 4700, 5600, 6100. I assumed it would keep going up for class of 2014 so if it didn't that's kind of disappointing. I'm using NALP data for this btw but that should be the same.

5600 Even for 2014