Journalist of the Day: Brad Kane

Today I want to feature two articles from the Hartford (CT) Business Journal, both written by Brad Kane.

First, we have Lawyers' Debt Hits All-Time High:

Today’s law school graduate has more debt than ever before, and is facing a market where getting a job is an extensive, grueling process. First-year lawyers are leaning on clerkships and part-time legal work, forced to abandon — or at least delay — their dream jobs to make their monthly debt payments.
...
The large debt is what sets this recession apart from all others, said James Leipold, executive director for the National Association for Law Placement.

That quote isn't completely correct, and I wish he had focused on someone broke and unemployed rather than the cute blonde who landed a job two weeks after the bar exam by "networking," but at least people might start to understand that the law school bubble is different if mainstream journalism keeps repeating these types of articles.

With that need for repetition in mind, Brad is the journalist of the day for publishing a second article on the profession as a whole on the same day, which I haven't seen posted anywhere else:

The message from Connecticut’s attorneys is clear: Unless you love the law, you’ll hate being a lawyer.

That’s the message more lawyers are telling their children.

And that’s a concern for an industry that finds itself in turmoil. The price of admission is up and interest in being a lawyer is down. The passion that once marked the profession is fading in the face of business pressures as law firms race to be the biggest and most comprehensive, judging lawyers’ value on the revenue they generate.

This is obvious to many of us who have already paid the for the boat show ticket, but ordinary people (and businessmen, like the readership of this newspaper) cannot hear it too many times: law is not what's on TV, and it's not what it was even 30 years ago.

And in this article, we get an actual anecdote of failure:

Avon native Daniel Lindenberg graduated in 2009 from Albany Law School in New York. . . .

Over the next 15 months, Lindenberg interviewed for 80 jobs. With $200,000 in deferred law school debt looming, the riches weren’t flowing. He moved back into his parents’ house. Connecticut bar exams, he started his job search.

Over the next 15 months, Lindenberg interviewed for 80 jobs. With $200,000 in deferred law school debt looming, the riches weren’t flowing. He moved back into his parents’ house.

He finally got a full-time job in January. The article talks about cutting costs, disbanding summer programs, and generally how the shift from profession-first to a business-first has fallen disproportionately on new lawyers.

All true, and I wish every newspaper in the country ran a story like this so the masses could see the major problems in the legal field.

Yale Daily News Puts Legal Elitism in Black and White

So today the Yale Daily News gives us a long-winded, comprehensive look at "elite" law students, where they come from, how they adjust to life at grand ol' Yale, what happens while there, etc. For anyone who still harbors any silly thoughts of meritocracy, this article should help you see that the upper Ivy League is basically run on a a series of elitist tautologies.

But in the midst of an article trying to make the Yale student body and its aspiring lawyers feel even better about itself, we get a flat-out admission regarding legal hiring:

Rivera interviewed roughly 40 professionals involved in law firm recruitment and hiring, and found that these people give particular preference to candidates from Harvard, Yale or Stanford law schools when reviewing job applications.

Although many recruiters actually believed that graduates of non-elite law schools were more prepared for the practical aspects of being a lawyer, they still preferred to hire from super-elite schools because of the prestige associated with them.

Yes, right there, in the Yale Daily News is an admission that many recruiters believe other "non-elite" law schools prepare their students better for practice.

And yet, (1) Yale is still the best law school in the country, says US News and World Reports and (2) Yale law graduates still get jobs much easier than others.

They're not even trying to hide how screwed up this system is anymore. It's right there in black-and-white, despite the various arguments thrown out by shameless elitists. (Side question: Did the Yale Daily News even realize they were admitting Yale must not be an excellent law school if others prepare their students better? Think about it.) Normal rules of capitalism simply do not operate at the large firm level; or, if they do, the value of a degree that says "Yale" is worth infinitely more than a degree that says "St. Johns" or "Ohio State."

Could you imagine any other trademark having this effect? You're a completely mediocre guy, but you buy a HONDA and all of a sudden your earning power triples what it would if you bought a TOYOTA. It'd be a commercial basically. You buy the product, life changes. Women want to sleep with you, men want to be you, and live in perpetual bliss while the schmucks who buy the cheaper Toyota actually have to work for a living.

This is, of course, absurd, but it's exactly like what happens in legal hiring all the time. The same kid goes to the local state school for dirt cheap and even if he makes law review and wins a gazillion awards and ranks top 5%, he'll be a longshot for BigLaw, whereas if he went to NYU or Virginia and hit the median or higher, he'd have a much easier shot.

Unfortunately for the makers of every other product in the country, their customers aren't as prestige-drunk as large law firms. Yet those in charge of legal hiring are apparently convinced that clients would balk at paying non-elite graduates high billing rates, even if the non-elite associates are more competent lawyers than their Yale peers. One has to wonder if the lawyers can't justify their own best-interest hiring practices (like paying slightly less for equal or better quality from lesser-known schools) to their clients how they can win borderline cases, but I digress...

At least this isn't lost on some Yale students.

While his classmates are well-qualified for these jobs, [one student] said, the law firms’ selective bias overlooks other candidates — such as his friends at the University of Iowa Law School — who may be just as qualified.
...
[Aanother student] said that the recruiting system reinforces the system of class privilege, in which richer students are more likely to attend good high schools, get into elite colleges and professional schools, and then score jobs at top-ranked firms.

Although she is only in her first year at Yale Law, Luna said she already has a summer job at one of the top firms in Seattle — a job she feels she may not have gotten if she attended a different law school.
...
But this is not always the case, said Hedy Aponte, director of attorney recruiting and development at the prestigious Kirkland & Ellis firm’s Washington D.C. Office. Aponte said her firm sometimes chooses recruitment targets based on geographic proximity to the firm rather than elite status.
...

Kirkland & Ellis focuses on schools ranging from Yale to University of Virginia to George Washington University, she added.

When asked to provide data on how many Kirkland & Ellis lawyers were hired from Harvard, Yale and Stanford, Aponte declined.

Whoa, Hedy! Talk about diversity! George Washington? Virginia? Gosh darned, that's egalitarianism at its finest. What, no Emory or Georgetown graduates?

By the way, Yale Daily News, if these people decline to give you the data, you might want to run a Google search. Kirkland and Ellis puts all of its attorneys information online and it's searchable by law school. I get that our ideals of journalism have sunk, but real journalists would at least check publicly available information.

I actually ran the Kirkland data back when I did part 2 of my rankings project (still going on, since I know people are wondering about it).

In the survey, Harvard had 74 partners (12.7%) and 65 (9.3%) associates, the most from any school in either category. Stanford and Yale are actually way down the list; instead, Chicago, Northwestern, NYU, Columbia, Georgetown, Michigan, and the University of Illinois rounded out the top eight. With DePaul, GWU, and Fordham above Yale, it's probably safe to assume it has more to do with their offices in Chicago, NYC, and Washington D.C. than anything. But ultimately, despite Hedy's assertions to the contrary, Kirkland is still elitist (1.7% of your hiring pool came from DePaul. Yippee).

This would be one of those spots where I think the article was very under-researched. Harvard, Yale, and Stanford aren't the end-all of prestige hiring or elitism. But that's really getting beside the point. The point is that it's an exclusive club, and no matter your merits, you're probably not getting in unless you have the right stamp, even if you have objectively offer a superior quality of underlying product at a lower price.

The branding of the Ivy League with regards to prestige is, perhaps, the greatest marketing and advertising success in global economic history. One can only wonder if and when the ultimate consumers (i.e. clients of large firms) will fully catch on.

NLJ Report Shows Contracting Proportion of Graduates Going to Top 250 Firms

The National Law Journal has conducted a survey of hiring at its top 250 law firms.

I'm not going to copy the list, suffice to say that many of their results match up with the similar small-scale study I did awhile back on this exact same subject. Stanford did more poorly than you'd expect; Howard, BYU, and Rutgers-Newark did better than expected. But there are also some surprises. Yale finishing only 15th is a surprise. Same with Wake Forest, Seton Hall, and Maryland being more highly rated that I'd expect.

But what's really noteworthy is not the order of the schools, but the percentages. Texas is 20th on the list and only a quarter of its grads land jobs at these firms. By the 50th school, the number drops to 10%. It's not just conjecture: you really do have to be in the top 10% for the jobs most of these schools portray as what the median graduate does.

The most noteworthy result is the comparison to 2009, most notably how more exclusive legal hiring has become:

[T]he top two schools on the list supplied nearly 3% more of their graduates to the nation's 250 largest law firms, compared with 2009. But overall, this year's Go-To Law Schools sent fewer graduates into the big-firm market. The percentage of 2010 graduates taking jobs at NLJ 250 law firms was 27.3%, compared with 30.3% of 2009 graduates.

With 45,000 graduates, a 3% drop translates into 1,350 people who are looking for jobs elsewhere. But if the top schools' numbers are increasing, that means that 1,350 deficit is coming disproportionately from lower-tiered schools. In other words, it seems big law firms are being more exclusive in their hiring practices and taking fewer chances on kids from second- and third-tier schools.

Thus, when the job market fully turns around, it looks like there may be a trend towards elitism instead of away from it. With fewer big law jobs to go around, big firms may be more reluctant to "take a chance" on no-name school graduates, instead making certain that they fulfill their "prestige" quotient. So when you third-tier career services' offices claim the job market is turning around, even if it's true for Cornell graduates, it's not necessarily true for everyone else.

Hiring Bottleneck for Lower-Level New Jersey State Courts

This shouldn't surprise anyone, but it's a message that should be shared since there are apparently people still under the delusion that the tip-top law school grads still have it hunky-dory and that you have to do something "wrong" to not get a good job.

Competition for jobs as a law clerk making $48,000 in Passaic County, New Jersey has skyrocketed.

State Superior Court judges in New Jersey have seen a substantial jump in law-clerk applicants — many from Ivy League schools all over the country — as big law firms cut back on hiring attorneys fresh out of law school.

“Over the last two years, I would say I’ve had four times as many applicants. And of those applicants, they’re all with superior grade averages of over 3.5 from law schools all over the country,” said McVeigh. “I normally get excellent r[e]sum[e]s. But the volume of excellent r[e]sum[e]s — even the quality — far surpasses anything I’ve ever seen. These are the kinds of applicants that would normally have gone to [state] Supreme Court, or one of the large-starting-salary firms.”

There are no Ivy League law schools in New Jersey, so if he strictly means "Ivy League," that means there are Columbia, Cornell, Penn, Harvard, or Yale grads applying to this place. If "Ivy League" was a misstatement for "top schools," that probably means there are U. of Chicago and Cal-Berkeley kids sending their resumes to the New Jersey State Supreme Court.

And tell me, exactly, how even lower-tier schools can continue to claim 100k+ median starting salaries if their 3.5+ kids are applying en masse for $48k jobs? At most law schools, a 3.5 is a pretty high GPA given the harsh curve. I'd estimate a 3.5 translates to being in the top 15-20% anywhere, and that's with a loose curve (with a tight curve - say, where the 1L median is a 2.5 - maybe only 5% of the 1L class would have a 3.5 or higher).

Out of all law students in the country, kids applying for these jobs are easily in the top 10%. The job pays $48,000 and is not that prestigious. How can anyone at this point believe the other 90% made a sound investment?

Next Law School: ALAKSA!

I can't believe that since I've started this blog (less than two months ago), we've heard about three places that don't need them planning to build law schools: Delaware, Binghamton, and Kaplan U. in Washington D.C. Today we get to add a 4th: Alaska.

Rep. Scott Kawasaki today announced he will introduce legislation to create the UA School of Medicine and the UA School of Law at the two main area campuses in Fairbanks and Anchorage. Kawasaki said that the time to invest in education is now if we are to build the workforce that Alaska will need in the next 20 years. Kawasaki points to the continuing doctor shortages and the costs of healthcare and legal services.
...
"It is time Alaska begins to grow its own doctors and lawyers." Kawasaki said.

I'm sending Rep. Kawasaki an email about this, but unless the state is going to give away legal educations for free (or close to it) to in-state residents, which they likely cannot do, it's a colossally stupid idea.

First, this idea that you need more lawyers in Alaska because "the costs of . . . legal services" is high is absurd. A glut of unemployed JDs has done nothing to lower costs in any other state (see Florida, Illinois, California, New York, etc.), as the high cost of legal services comes from other price pressures rather than the high cost of labor.

Second, this idea that Alaska should be "grow[ing] its own" is laughable. If you live in a neighborhood where you have five neighbors and all of them grow twice as much corn as they need, you should rejoice that you don't have to grow any and get to buy theirs at a competitive price. Your response should not be "I'm going to pay and grow my own!"

This is the dumbest possible reason to start a law school. First of all, the imports are going to continue coming. Some of the more notable firms in Anchorage are multi-city firms with roots in Seattle or Portland, and they will continue to hire the best and brightest they can get. For example, Lane Powell has staffed its Anchorage office with grads from U. of Texas, U. of Chicago, and Duke. That's not going to change. Even if there were an Alaska law school, firms would still have an incentive to continue employing grads from higher-ranked schools; go look at Delaware: do you see Widener grads filling up Morris Nichols? Your most notable attorneys are going to continue to be "imports" for a long time to come.

Second, attorney salaries in Alaska are already dirt cheap (sorry I can't find a better source on this). Attorneys have this way of finding gold before legislators, and if there was a real demand for attorneys in Alaska, countless scores of unemployed Gonzaga, Willamette, Seattle, U. of Oregon, U. of Washington, U. of Idaho, Pacific, Pepperdine, UC-Davis, UC-Hastings, U. of San Francisco, U. of Montana, U. of North Dakota, U. of South Dakota, etc. etc. would have taken the next train to Juneau, just as they did when Las Vegas had some green pastures. They are not doing that.

Because the market demand is already more than met, legal services prices are not going to noticeably come down by purposefully flooding the market with your own homemade fourth-tier J.D.s. Because a hypothetical UA-Law degree would have no value outside Alaska, graduates would have scant few locations to work. Since their salaries would be low, and because of Alaska's location, it would have no prayer of ever moving up in the rankings or drawing in lucrative out-of-state tuition money that many schools find essential to being a viable law school. Perhaps Rep. Kawasaki is looking to North Dakota or Wyoming or Hawaii as models that work, but all of those schools have been around a long time and have substantial local alumni bases.

Given that there's no need for new attorneys, no chance for lowered legal costs, and no possibility that the state can draw in talented people from other states, there's no benefit to building an Alaskan public law school beside the hubris of "growing one's own." On the contrary, there's a substantial amount of risk in building a new public lower-tier school in a contracting field with an oversupply of labor, notably that you're going to piss off countless current Alaskan citizens by saturating their job market even further. Finally, because they can't draw out of state tuition money, lower-tier publics like those in Wyoming and North Dakota are subject to severe restrictions based on available public funding. Alaska, like every state, has tangible budget and deficit issues. This will likely prevent Alaska from ever escaping the fourth tier. Why would the state's "best and brightest" ever risk going there when they could go to Stanford or the U. of Washington (or Yale, for that matter) and come back and get a job with the Anchorage firms without issue? Many schools treat Alaskan residents like in-state residents (see the U. of Arizona for one example) because Alaska doesn't have a law school. Why would you throw away that perk?!?!?

This exact same issue was looked at in 2004, Rep. Kawasaki. The study concluded, among other things, that a law school was not worth it:

• Taken together, all the data indicate that demand for lawyers in Alaska in the past five to 10 years has increased little.
• Most of the ["new"] jobs will likely come from lawyers retiring or leaving the profession.
• The available data are limited, but what we know indicates there wouldn’t be enough Alaskans (or students coming from other states) to meet the minimums needed to sustain a law school....
• the information we gathered indicated that an ABA accredited law school could cost $40 to $50 million to establish and $6 million per year to operate. In a time of budget shortfalls and conflicting state needs, it is difficult to imagine that the legislature would appropriate the money....

Nothing has changed since then except now there are even more unemployed lawyers roaming around the United States, and therefore even less reason for Alaska to flood its own market.

This is an idea so dumb, I'm sure Sarah Palin probably supports it.