Tuesday, April 5, 2016

Changes In Legal Employment Patterns Might Give Advantage To Highly Educated

An associate professor of law at Seton Hall Law School has an interesting take on the commentary surrounding legal sector employment stagnation.

According to the Census Bureau’s American Community Survey, law firms employed about 90,000 more lawyers and about 80,000 more paralegals in 2014 than at the start of the survey in 2001. At the same time, law firms shed 180,000 to 190,000 legal secretaries, other legal support workers and their supervisors.

As a result, [commentators] have mischaracterized a decline in the fortunes for low-skilled support workers at a time of expanding opportunities for highly educated workers as stagnation for all.

Law firms have sharply upgraded the education level of their work force, increasing the number of workers with graduate degrees by 100,000 and those with bachelor’s degrees by 30,000. At the same time, jobs for those with one year of college or less have shrunk by 125,000.

Those who say law firms are going through “structural change” may be right. Changes in employment patterns appear to be giving those who are highly educated an even bigger competitive advantage than they have had.

The best way to measure the benefits of education is not by counting jobs, but rather by measuring the earnings premium, or differences in earnings caused by differences in education. This measure also shows the advantages of education growing over time.

It is certainly important to look at numbers carefully to determine the information to be gleaned from them. But I'm not so sure that this is great news for law graduates. Does it mean that law graduates are replacing low-skilled support workers in law firms and earning the salaries that come with low-skilled support work? If you can hire a law graduate for $35,000 a year, why would you hire a high school graduate instead? While people with JDs are likely to fare better than people with high school diplomas in the legal sector, it is still rough going for JDs who have to service major student debt loads on potentially smaller salaries.

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