The high cost of tuition coupled with uncertain job prospects has led to a 23 percent decrease in applications to law schools in the Great Lakes region. Courtesy Thinkstock
Law schools across the country are seeing the lowest number of applicants in 30 years, with an average decrease of 19 percent since 2012.
According to the Law School Admissions Council, as of January there were only 30,000 applicants to law schools for the fall, a 20 percent decrease from 2012 and a 38 percent decrease from 2010.
“Applications to law schools in the Great Lakes region are down 23 percent compared to a year ago,” said Frederick Dilley, Michigan State University College of Law board member and attorney with Foster Swift Collins & Smith PC.
“We believe that the 2013 incoming class for all accredited American Bar Association law schools in the country will be between 54,000 to 55,000 applicants. To put that in perspective, a year ago ABA law schools admitted 54,000 (students) in August. So the number admitted last year is the number we actually expect to apply this year.”
Several contributing factors may be leading to the decrease in interest by prospective students: the recent recession, increasing tuition costs, rising student debt, a decrease in hiring by law firms and overall changes to how law is practiced.
“There has been a sort of perfect storm within the economy for law students and prospective law students,” explained Bruce Courtade, State Bar of Michigan president and shareholder with Rhoades McKee.
“What they are seeing is that the cost of law school has skyrocketed at the same time the number of jobs available for law students is declining. At the same time, up until very recently, there were more law students than ever, and lawyer income has been going down.
“For the first time in the history that the State Bar of Michigan has been surveying its members, the last economic law practice report indicated that, over the proceeding 10 years, hourly rates were going up for lawyers but the median income for lawyers went down.”
In the past, law students graduated confident they would quickly secure a job and begin practicing law, enabling them to start paying down their student debt. But recent graduates are finding the jobs just aren’t there, and they still have to pay off that same pile of debt.
“The latest ABA stats said that only 56 percent of graduates secured long-term, full-time jobs that required a bar passage rate, so it’s a one-in-two chance that you are going to take on that much debt and not have a job that pays you the big money that you thought you are going to get,” Courtade said.
“I think students are becoming more educated and aware of that fact, and I do believe it has a chilling effect on the number of potential applicants to law school,” he added.
Currently, students leave law school with easily more than $100,000 in debt. According to U.S. News and World Report, Yale University’s law school, which is ranked in the No. 1 spot, has a tuition rate of $53,600 per year. Harvard’s, which ranks No. 2, isn’t far behind at $50,880 per year.
In-state law students attending the University of Michigan-Ann Arbor, which is ranked No. 9, pay $48,068 per year; Michigan State University (No. 80) law students pay $35,377, while those at Wayne State University, ranked No. 105, pay $27,135 per year. Students at Thomas M. Cooley Law School, which isn’t ranked, pay $37,140 per year.
The way law is practiced also is changing, with new technology and alternative options causing many firms to hire a smaller number of new associates each year.
Courtade pointed out that firms that used to hire 20 associates in a given year now are more likely to hire five, while firms that hired five might only hire one. He attributed a lot of that to the fact that technology has decreased the staff needed to accomplish legal work.
“You have alternatives available — whether through the Internet or alternate suppliers of legal services — that clients can seek out as alternatives to paying lawyers,” Courtade said.
The legal industry also is experimenting with outsourcing to overseas companies to cut down on costs.
“I know that, within the last five years, there was actually a company that was formed locally that hired lawyers in India where people could outsource their legal research,” Courtade noted. “I don’t have a handle on how prevalent that is, but it’s another example of the increased competition, which is forcing law firms to consider changing the way that they’ve done business in the past.”
Law schools are trying to adjust to the sharp decrease in applicants, with many of the nation’s top law schools decreasing their enrollment in order to preserve their rankings as top law programs. Some law schools are going the other route and changing their admissions standards in order to continue to admit the same number of students as before. And many are doing a combination of both.
Hastings College of Law in California reportedly reduced its enrollment admission rate by 20 percent in 2012. Other schools that have announced a decrease in enrollment include Northwestern University, George Washington University and Creighton University.
Michigan State College of Law also plans to reduce its admissions for 2013.
“We are going to have a slightly smaller projected class size entering in the fall,” Dilley said. “We project 280. Over the last five years it’s been 298, 307, 299, 288 and 306, so it’s probably averaged about 300. This class will be a little smaller.”
The University of Michigan told AnnArbor.com it would not be adjusting its enrollment as long as its lawyers continue to find jobs at the rate they have been.
Courtade said the University of Michigan has so far been somewhat insulated from the national trend, but it is still seeing a decrease in applicants.
“According to recent reports, the applications for the fall class at U of M are down 3 percent since fall of 2012. But in the two years before that, they were down 7 percent for the class of 2012 and 10 percent for the class of 2011.”
Many schools are overhauling their curriculums to help ensure the competitiveness of their students in the current law environment.
Dilley said MSU has been recognized as a national leader for the curriculum changes it’s undertaken in the past few years that focus on real world experience and preparedness for practicing law.
“We have some very specialized programs being developed in our curriculum that specifically have to do with use of information technology, especially,” Dilley said. “Because I don’t think there is any question — clients are demanding more, and they are demanding better pricing and more productivity.
“In order to accommodate that, we believe we have to produce lawyers who are more efficient, more savvy with information technology and client-ready when they graduate.”
Local law firms Warner Norcross and Miller Johnson both said the decrease in law students is not a concern for them. They see law schools that are decreasing enrollment as making the right decision to meet the supply and demand needs of firms.
Bill Fallon,chair of the Recruitment Committee at Miller Johnson, said that the quality of law students applying to the firm has not changed in recent years.
He added, “If a law school becomes less selective in admissions in order to maintain enrollment numbers, employers who hire law school students and graduates are going to figure that out quickly,” Fallon said. “This will adversely affect the reputation and credibility of the school and will impair the competitiveness of its graduates in the market.”
Additionally, neither law firm sees curriculum changes as likely to have a drastic impact on firm hiring.
“We anticipate that there will be significant experimentation and innovation in legal education to find better and more cost-effective ways to prepare law students for their career,” said Rodney Martin, diversity partner and a member of the recruiting committee at Warner Norcross.
“Doing so may significantly reduce the amount of debt law students have to take on, but the decision whether to employ more law school graduates will be dictated by the needs of our clients more than the nature of the law school curriculum.”
Joy Fossel, diversity counsel with Varnum, does think in the long term fewer applicants could have some impact on the local legal community in attracting and retaining attorneys, particularly of diverse backgrounds — which is already an ongoing struggle for the area.
“Of course the specter of a shrinking pool of candidates can present challenges,” Fossel said. “Among other things, competition with larger markets for qualified diverse candidates will arguably become more intense. However, the Grand Rapids legal community will continue to offer greater work/life balance than firms in Chicago, New York, Washington, D.C., or other larger metropolitan communities.
“That, together with initiatives like the Managing Partners Diversity Collaborative and the strides Grand Rapids has made in its art, entertainment and foodie communities, extends our ability to attract and retain new young talent as well as those looking for not just a career but a life.”