Admissions Chances Improve; Employment Outlook Brightens

Commentary

Don LeDuc, President and Dean | January 29, 2013

Introduction

Here's a look at some data from the past ten years, most of it from the Law School Admissions Council.1

The first nine years provide complete data. The last is incomplete and includes the 2012 estimated national first-year law school enrollment provided by the Section on Legal Education and Admission to the Bar of the American Bar Association.

Using this data and additional ABA historical data regarding first-year enrollment and graduation numbers, predictions for the 2013 entering class and for the 2013 to 2016 graduation classes are possible. Data regarding past employment is also provided. It forms the basis for evaluating the potential for future employment among those entering law school now.

In sum, the chances for law school admission today are at historical highs, and the employment outlook for law graduates is good.

Part One: Law School Admissions

This part presents historical data and discusses the current situation regarding law school admission and enrollment.  Table 1 shows the trends in LSAT takers, CAS registrations, and law school applications over the past nine years.  

Table 1


Table 2 provides information about law school applications, applicants, admissions, and enrollment for 2003-2008. Table 3 looks at the same data for the years 2009-2011, with preliminary data for 2012, and a look at the possible outcome for 2013.

Table 2

Table 3

Notes:

Analysis

The recession that began in late 2008 transformed more than the national economy.  Law school applications followed the normal recessionary growth pattern to a point, but fell off as the recession continued and employment challenges for law school graduates increased. 

Pre-Recession:  This analysis uses an average of 2003 to 2008 data as a base (shown on the bottom of Table 2).  These are the six years before the recession in the fall of 2008, after the entering classes that year had started.  Nearly all of what happened during this six-year period was pre-recession.

What at first seems apparent is that the number of first-year students enrolled in the base period was very stable. From 2003 to 2008, entering class size increased only by 500 students or 1.0%. But beneath the averages, these six years were actually quite dynamic, at least from the applicant perspective. 

After an increase to a record 100,600 applicants in 2004, the number of applicants fell every year thereafter. Although the number of applicants fell by 16.2% during the six-year period, the number of applications received by the schools actually increased. The number admitted by the schools declined by only 2.3% in the same period. 

Comparing 2008 to 2003, the schools received more applications but admitted fewer students. This logically would lead one to conclude that fewer students would be enrolled as a result, but that logical assumption did not pan out. Why? The yield from the lower number admitted was about 3% higher in 2008 than in 2003, and that increased yield resulted in a 1% increase in first-year class enrollment from 2003 to 2008.

Schools must evaluate applicants and make admissions offers based on the applications they receive.  They generally have no idea how many other schools each individual applicant has applied to or which students will accept their admissions offers and which will not.  The percentage of applications that resulted in admissions offers in 2008 (10.5%) was actually slightly lower than in 2003 (10.9%), but the number of applications submitted per applicant rose from 5.25 to 6.36 during the six-year period.

By 2008, applicants were more likely to gain admission offers. In 2003 only 57.1% of applicants were admitted, but by 2008 66.5% of applicants were admitted. The number of applicants not admitted to any school fell from 42,700 to 27,900 between 2003 and 2008. Furthermore, in 2003 only 49.1% of applicants eventually enrolled in law school compared to 59.2% of applicants in 2008.

Some of this increase in success is accounted for by the increase in the number of new schools. The number of ABA-accredited law schools increased from 186 at the end of 2002 to 198 at the end of 2008, an increase of 6.5%.  While these 12 new schools offered additional opportunities and alternatives to applicants, their arrival did not result in a significant increase in overall first-year enrollment, which was only 1%.  However, it possibly could be said that had these new schools not come on the scene and had the 49.1% enrollment success rate continued, significantly fewer students would have started law school in 2008.

Still, it seems apparent that the schools were not being greedy or particularly competitive.  Collectively, from the applications they received the schools admitted at about the normal rate. Because the applicants submitted 20% more applications per applicant than was earlier the case, and because the yield from admissions offers also increased, the schools appear to have been doing what they normally did--it was the applicants whose behavior changed.

Recession: As shown in Table 3, taken together, 2009 and 2010 evidenced the common experience in past recessions, with professional school applications increasing. Applicants, admissions, and enrollments all rose in both years, but this increase actually followed a substantial decrease in applicants that began following a peak in 2004. Applicants declined every year from 2005 to 2008. The number of applicants in 2010 was well below the 2003-2008 average. Also, the percentage of applicants admitted increased from 66.5% in 2008, to 67.4% in 2009, and then to 68.7% in 2010.

2010 can be seen as a transition year, with the recession deepening beyond previous experience and national unemployment increasing.  The strident criticism of law schools also began to take hold and denigration of law as a career option increased. 

2011 showed a sharp decline of 65,800 applications (-10.9%) and 9,400 applicants (-10.7%) from 2010.  Admission offers fell 7.6%, the smaller decline reflecting the tendency of schools to lower their admissions standards when faced with declining applications. Enrollment fell by 7.2% in 2011, and the 48,700 students in the entering class was the smallest since 2006, and it almost exactly matched the 2003-2008 prerecession entering class-size average.

Based on preliminary data, applications further declined by 66,900 in 2012 (12.5%) and the number of applicants declined by 10,500 (13.4%).  Although figures regarding admission offers are not available, the preliminary ABA first-year enrollment count of 44,481 is a drop of 4,219 (8.7%) from 2011.

Over the last two years, first-year law school enrollment has fallen by approximately 8,019, or 15.3%.  Since 2010, the number of applications fell by 22.0% and applicants fell by 22.6%, meaning that schools are clearly compromising between reducing class size and lower admissions standards. Only one new law school was accredited between 2009 and 2011, so law school growth does not account for much of the first-year enrollment change.

2013: The preliminary figures from the Law School Admissions Council show that another substantial decline is in the works for the fall 2013 class.2  As of 1/18/13, there are 27,891 applicants--down 20.1% compared to the same week in 2012.  Last year’s total at this point in time represented about 51% of the total applicants to the fall 2012 class.  Applying this percentage to the present 27,891 known 2013 applicants, we can project that the fall 2013 total applicants will about 54,688. Prior law school behavior would suggest that the schools will enroll about 9% fewer students or about 40,500. Assuming that occurs, first-year enrollment in 2013 will have declined by about 12,000 from 2010, a decline of roughly 23%. It is likely that nearly 75% of all applicants seeking to enter law school in the fall 2013 will be admitted.

This data shows that the law school market behaved as might have been expected through 2010, with the poor economy influencing more individuals to apply to law schools.  The data also shows that the market may have begun to overcorrect beginning in 2011 and certainly has done so in 2012 and so far in 2013.

While the data shows that law schools face exceptionally challenging times, they represent the opposite for law school applicants. There has not been a better opportunity for law school admission in decades.

Part Two: Law School Graduation and Post-JD Employment

This part looks at the effect of recent and projected enrollment activity on law school graduation numbers and law graduate employment. 

Law School Graduates: Here’s a look at graduation figures and projections:

Table 4

3. http://www.americanbar.org/content/dam/aba/administrative/legal_education_and_admissions_to_the_bar
/statistics/enrollment_degrees_awarded.authcheckdam.pdf
.  Last accessed 1/23/2013.  Note that this document is inaccurate because it reports the JD/LL.B. Degrees Awarded in the wrong year, e.g., the 44,495 degrees listed as having been awarded in the 2011-12 academic year were actually awarded during the prior academic year (2010-11) and reported in the 2011 Annual Questionnaire.  The same problem with degrees awarded exists for each year listed in this report.  We have corrected that error and attributed the degrees awarded to the spring of the correct academic year because that is when the bulk of law school degrees are awarded, thus the 44,495 degrees awarded in 2010-11 are listed under 2011.  As reported here it is consistent with annual NALP data.

As noted in Part One, enrollment figures showed the usual market reaction to a recession, increasing in 2009 and 2010 as college graduates and others faced a declining general employment market. In 2011, this adjustment was completed and entering class enrollment returned almost exactly to the pre-recession norm.

The projected graduating classes in 2012 and 2013 reflect the increased enrollment in the fall three years earlier. Assuming the graduation rate stays around 90%, the number of 2013 graduates will likely be a record high, reflecting the record first-year enrollment that occurred three years earlier.

In 2014, based on 2011 enrollment, graduation numbers will drop, falling by about 3,400 to 2003-2005 levels, well before the recession. Assuming the same 90% graduation rate, the graduation number will fall about another 3,800 in 2015 and an additional 3,500 in 2016 to 36,450—a 22.8% drop from 2013 to 2016. 2016 will bring approximately 7,210 (16.5%) fewer graduates than the 43,660 average from the six pre-recession years (2003-2008). If the projection of some 40,500 entering law students in 2013 is correct, the corresponding graduation number in 2016 will be comparable to the law school graduation numbers from the1980’s. 

This means that those entering law school in fall 2013 not only have the easiest path into law school, they will also have the lowest competition for new jobs in nearly three decades when they graduate. It appears that the market has already overcorrected.

Graduate Absorption Rate:  Law school graduates will enter a market that has been absorbing the number of law school graduates very well, despite the tough economy.  Although there has been a recent clamor over the glut of law school graduates, the reality is that the employment market for lawyers has been stable, evidencing modest growth over the past eleven years, despite the recession. 

Table 5 combines ABA data with data from the U.S. Bureau of Labor Statistics. 4  For the past eleven years, the schools have graduated an average of 41,988 students. The number of graduates per year has been exceptionally steady compared to the number of employed lawyers per year, ranging only 0.5% in the period and averaging about 4.3%.  Over the same period, the number of employed lawyers has grown by 15,273 per year or 18.3%, an average annual increase of 1.7%. Table 5

4. U.S. Bureau of Labor Statistics Current Populations Survey annual data, table titled: “Table 3. Employed and experienced unemployed persons by detailed occupation and class of worker, Annual Average [for Years 2001 through 2012] (Source: Current Population Survey).” 

Lawyer employment grew by 168,000 from 2001-2011, but the ratio of the number of graduates to the number of employed lawyers remained very consistent over that time.  Even with a major recession, unemployment among lawyers has remained quite low. 

The figures appear to establish two points. 

One is that not all law school graduates seek to enter the lawyer employment market.  Were that not so, lawyer unemployment would be much higher.

The other is that a substantial number of lawyers are leaving legal employment, mostly through retirement and death.  Indeed, many baby-boomer lawyers have delayed retirement because of the economy and will be leaving the profession in greater numbers each year as the economy improves.  Contrary to the assertions of some, the lawyer employment market does not need to supply a new position for each law school graduate and never has done so.  The market need only supply the number of new positions not opened to new lawyers by the death or retirement of lawyers who were previously in the market. 

Those seeking a career in law in the next three years will:

In sum, there has never been a better time to attend law school.