Online newsmagazine Slate checked in yesterday with this story about how law schools acting in their own financial interest are creating an oversupply of debt-laden grads who cannot find jobs in the legal profession.  While the article doesn’t contain much in the way of shocking new revelations, it very nicely summarizes the disconnect between how prospective J.D.’s view the market for their services…and what that market actually is.  It also suggests–perhaps less stridently than it should–that law schools and student loan companies and even the American Bar Association have vested near-term interests in continuing to create this oversupply.  The basics:

Supply:

1.  The number of JD’s awarded by schools is up 11.5% over the past ten years. 

2. The number of newly accredited law schools is up 9% over the same period. 

3. The number of LSAT takers is up 20%  since 2007.

Demand:

1. The number of law jobs available has fallen by 7.8% since 2007.

2. This represents a 50% steeper decline in jobs than that seen in the general economy.

3. This trend is expected to continue.

4.  In an effort to preserve their rankings and continue the flow of incoming students, schools report job placement and salary stats that they have to know are misleading, making the supply look richer than in actually is.

On this last point:  it has become increasingly clear that schools are fudging the post-graduate employment rates and salary figures that they send to U.S News and World Report and the National Association of Legal Placement.    When they report that “88% job placement,” what they really mean to say is “since those students who have jobs are way more likely to repond to our questionnaire than those who don’t have jobs, and since we include temporary and part-time jobs as ’employment,’ and since we’ve created thousands of make-work fellowships to keep our employment numbers up, we’re guessing that the percentage of our recent grads who are fully employed might be closer to 40%…but we’re going to call it 88% because that keeps the applications flowing in.”  Also, when schools report a mean salary of $80,000 for first-year grads, they may technically be accurate, but only because the small percentage of grads who land high-paying BigLaw associateships  disproportionately elevate that mean.  The median salary–what the typical grad might reasonably expect to earn–is definitely much, much lower and so (surprise!) goes unreported by the schools.

The article concludes that there will have to be a contraction among the nation’s law schools in the future, with the better schools and the schools that are better equipped to handle new market realities surviving while the weaker schools fail.  The logic seems irrefutable.

Or, if you’re Massachusetts, you could choose this time to launch a brand new state law school.

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