The Mercian Royal Family is sort-of in the market for a new castle. So, we sometimes drive around on Sunday afternoon and look at houses. We stopped by an open house in a nearby neighborhood a couple of weeks ago. The house was way beyond the budget of this minor kingdom (not enough serfs to exploit I think), but it’s fun to look. The real estate agent made a little bit of small talk and casually asked what I did for a living. When I told her I was a (soon to be) lawyer, her eyes positively lit up.
My brother, also a lawyer, recently faced the same reaction when buying a house in Utah. He recounts how he dreaded the point in the discussion where the seller asked about his job. He wanted to lie and say he was a plumber or a school teacher. Because, the reaction was invariably, “Oh, you should have no problem affording this house then.”
Everyone knows that all lawyers are loaded, aren’t they? It turns out that maybe not.
A friend and loyal reader recently sent me this article from the Wall Street Journal.*
A law degree isn’t necessarily a license to print money these days.
For graduates of elite law schools, prospects have never been better. Big law firms this year boosted their starting salaries to as high as $160,000. But the majority of law-school graduates are suffering from a supply-and-demand imbalance that’s suppressing pay and job growth. The result: Graduates who don’t score at the top of their class are struggling to find well-paying jobs to make payments on law-school debts that can exceed $100,000.
Can you say “bimodal,” and this predates the recent move to a $160,000 starting salary at many big firms. Unfortunately, the future prospects might not look any better.
The Wall Street Journal article spills a lot of ink taking law schools to task about their marketing and makes some valid points about the transparency of law schools’ marketing material. A law school could say, “the average starting salary of our graduates is $95,000,” and that would be perfectly true and honest. But, it doesn’t quite tell the whole story because almost no one makes $95,000. Starting lawyers make almost twice that much . . . or half that much.
Maintaining a little skepticism, I do have to wonder if the graph represents actual salaries or base salaries. Smaller firms are much more likely to have a lower base with a higher portion of salary dependent on billing. For example, a small firm may offer a base salary of $50,000 with the actual salary being much closer to $90,000 if the lawyer bills a reasonable number of hours.
All this being said, I have one word of advice for those starting or considering law school:
Having been on the job hunting side and more recently on the recruiting side, there is not another single factor, or combination of factors, that comes close to the emphasis big firms place on grades. One can argue all one likes that good grades do not mean good lawyers, and I would probably agree. But, as I tell my clients: I don’t make the rules, I just explain how they work.
(HT Elijah G.)
(* I’m sure this article will shortly disappear behind WSJ’s pay-per-view firewall. Sorry.)