It is Spring 2020, and wow have we all been through a crazy first few months of 2020. The Coronavirus began upending the world economy in March and the long-term effects of such a massive economic shutdown likely will not be revealed for some time.
Uncertainty in the United States has skyrocketed, as millions of people have been furloughed and many millions more have been laid off. Amidst this shutdown the legal industry has not been left unscathed.
Big Law firms are increasingly shortening summer associate programs with the remainder being converted to online. Some firms are cutting the programs entirely. Summer opportunities appear even bleaker for law students who did not have internships going into March. Many law firms, government offices, and district courts aren’t even open, much less considering internship applications.
The last major recession in 2008 was horrendous for a variety of industries, including the legal market, but many law students carried on even in the face of poor employment conditions. The experiences of law school graduates in the aftermath of the Great Recession and the potential for an equally severe recession in 2020 begs the question, “is it worth enrolling in law school during a Recession?”
First Let’s Talk About What’s Going on In Law Schools
I am currently in my last few weeks of 3L year and I must admit that this semester has been the wildest. Like every other law school (to my knowledge), mine ended in-class meetings nearly a month ago. The vast majority of students (including me) have fled back to their families to wait out the quarantine.
Many law schools, including mine, have switched all exams to pass-fail. Pass-fail exams have been a blessing to some, but for many students that worked hard this semester to raise their grades it’s a huge disappointment. Students are increasingly anxious about their summer employment, and graduates worry about whether they will have a job waiting for them once they pass the bar.
Due to the pandemic, standardized tests such as the LSAT have been canceled, and some jurisdictions are considering postponing the July Bar exam.
Things to Consider in Going to Law School During a Recession
For those of you, like me, that are already in law school, our fate is sealed and we will just have to ride out whatever the economy throws at us.
For those of you considering law school, there are a few things that you should consider:
Great Recession law school graduates fared poorly compared to their peers
Not every 07-11 graduate regretted going to law school, but a significantly larger percentage were unsatisfied with their post-JD jobs and made far less than in previous years. From 2007-2013 the law school graduate employment rate nine months after graduation fell from 91.9% to 84.5%. This number does not sound so bad, but this statistic included ALL EMPLOYMENT, including jobs that do not require JDs.
Attendance tends to increase during the early years of a recession
Sounds crazy right? Job prospects are down and the jobs that are left are likely to be far more competitive than in normal times, so you would expect enrollment to go down. Well that’s not what happened during the Great Recession, at least for the first few years. Between 2007-2010 law school 1L enrollment increased from 49,000 to 52,000! That is a stunning increase, and it further contributed to a grim job market for graduates.
Of course, attendance numbers did not rise in perpetuity during the Great Recession, in fact they tanked after 2010. 1L enrollment tanked between 2010-2015, from 52,000 to 32,000! What happened? Enough people realized that the legal job market sucked, and employment prospects just were not worth the enormous investment in time and money that law school required. This decline in 1L enrollment and improvement in the economy served as a catalyst for improving law school graduate prospects, but it took years!
The Job Market
I am not an economist, so you won’t get a prediction from me on how bad this pandemic recession is likely to be. What I can tell you is that firm layoffs are becoming increasingly common, salaries are being cut, and new associates are being furloughed.
During a major recession there is a variety of private-sector legal work that dries up, such as M&As and IPOs, but there are a few practice areas that thrive during recessions. In particular, bankruptcy, restructuring and employment law typically do very well.
The bad news is that the strengths of these individual practice groups do not make up for the overwhelming majority that falter. At this point, anybody graduating soon (me) or considering law school right now must revise their job market expectations.
Public sector legal jobs are closer to “recession-proof” but there is a caveat
“Who cares what big law firms are doing with their associates! I’m going to be a [public defender, assistant district attorney, federal government attorney, etc], and those jobs are recession-proof!”
You’ve got the right idea, during the last recession public sector legal jobs fared far better than their private sector counterparts, at least in terms of job security. However, the caveat is that public sector jobs become more competitive in a recession. Why? Because you have thousands of private sector jobs being slashed and all of those law school graduates have to find work somewhere.
The point is that if you are aiming for a public sector job, chances are the work will be there, but during a recession your competition will be stiffer.
So is Going to Law School in a Recession a Good Idea?
Predicting the length and severity of a Recession is not an exact science. Even worse, renowned top-level economists regularly disagree amongst each other and their predictions frequently miss the mark entirely.
In hindsight, would I enroll in law school in 2007? Hell no, and there are many, if not most, former students that regret their decision to enroll in 2007. As I mentioned previously, the enrollment numbers increased during the first years of the Great Recession. But when it became clear that this recession was not simply a short blip, enrollment numbers dropped at a staggering rate.
There are reasons to believe that this recession will not be nearly as severe as the Great Recession. This recession is due to a public health crisis, not a structural collapse in our financial markets. Once strict stay at home orders are lifted and people are given some time to readjust, the economy may come roaring back. On the other hand, the IMF just predicted that this will be the worst recession since the Great Depression, so who really knows?
My recommendation is that if you already planned on attending law school and you are dead set on being a lawyer, enroll IF it makes financial sense. What is “financial sense”? In a normal economy it is extremely risky to go $150,000 into debt to receive a private school law degree. During a recession it is insane!
Planning on going to an expensive private school? Don’t go unless you receive lots of scholarship money to offset the cost or enroll in a cheaper public school.
School rankings and GPA are important enough during a normal economy, but they become even more important during a recession. Study your a$$ off for the LSAT so you can get as big of a scholarship at as good of a law school as possible.
Be honest with yourself about your law school prospects. If you performed poorly on the LSAT, and your attendance options are poor, law school simply is not worth it right now.
What if you are already a law student?
If you are already invested in law school, then there is no backing out at this point, but the economy is tanking and you are anxious about job opportunities. Welcome to the club, it sucks, but there is plenty that you can do to set yourself apart from the pack.
Here are a few tips for making yourself stand out from the crowd and get that first job.
Try your hand at some recession-resistant practice areas
Take a class or two in labor, employment, bankruptcy or restructuring law. You might find that you enjoy the subject. While you’re at it, try your best to find an internship that allows you to learn some of these practice groups.
Networking is extremely important regardless of the economy’s strength, but making connections can be a lifesaver during a recession.
Grades, grades, grades
Any recent grad will tell you that grades are the most important factor for a law school graduate’s first job. After that, your work performance is the number one factor, but good grades will help you with that first job.
Pick up a second language
Spanish, Mandarin, Russian, Arabic, German, French, etc. Foreign language skills can help you stand out among a pack of resumes whether you are searching for public or private employment.
I hope this article has helped those of you thinking about pursuing a law degree in a recession. Recessions make these decisions more difficult and certainly affects our anxiety levels, but if you want to be a lawyer and it makes sense financially, then you should take the plunge!