New law school graduates from the Class of 2015 secured fewer private practice jobs than any class since 1996, according to a new report.
Nevertheless, the percentage of graduates who found jobs in private practice increased slightly from the previous year, and private practice remains the single largest source of jobs for new law school graduates, the findings show.
At the same time, after being completely flat for two years, mean and median starting salaries for the Class of 2015 did see some modest growth, figures show.
The overall median starting salary grew by almost three percent, from $63,000 to $64,800, and the median law firm starting salary grew by five percent, from $95,000 to $100,000.
The National Association for Law Placement (NALP) recently released Employment for the Class of 2015 — Selected Findings, a summary of key findings from its upcoming annual Jobs & JDs: Employment and Salaries of New Law School Graduates — Class of 2015 report.
Despite a drop in the number of jobs and the graduating class size, this year’s report describes a flat employment rate of 86.7 percent, the same as was measured for the Class of 2014.
After reaching a record high of 91.9 percent in 2007, the employment rate for law school graduates fell steadily for six years in a row following the recession.
Reversing that trend, the employment rate for the Class of 2014 grew by more than two full percentage points, from 84.5 percent to 86.7 percent, and has remained at this slightly higher level for the second year in a row.
(The employment rate for law school graduates is measured 10 months after a typical May graduation, as of March 15, in order to allow time for taking the bar exam and obtaining a law license. Prior to the Class of 2014, the employment rate was measured nine months after graduation, or as of Feb. 15.)
Despite the improved employment rate, the number of jobs obtained has fallen dramatically since 2013, following a period of modest job growth after the recession.
In fact, the number of jobs obtained by members of the Class of 2015 went down in every single job category except for the largest law firms of more than 500 lawyers, according to the report.
The number of entry-level jobs obtained at these large law firms has grown by more than 1,000 over the last four years but, even so, for the Class of 2015 there were still about 1,000 fewer of these positions obtained than there were by the Class of 2009, most of whom were hired before the recession began.
“It makes sense that a smaller group of law school graduates secured a smaller number of jobs,” said James Leipold, NALP’s executive director, “but I was surprised to see that the private practice number was so low. You have to go back to 1996 to find a comparably small number of private practice jobs.”
Leipold offered one explanation for the shrinking number of jobs.
“Most jobs are not earmarked for new law school graduates,” he said, “and graduates will continue to compete with other junior lawyers for most jobs other than entry-level associate positions at large law firms, some judicial clerkships, and some government honors programs.”
In the law firm environment, Leipold said, “for law firms of every size, growing efficiencies created by technology and business systems and increased competition from non-traditional legal services providers will both likely continue to put downward pressure on overall law firm lawyer headcount in the coming years and even decades.”
Of employed graduates from the Class of 2015, 51.3 percent found jobs in private practice.
This compared with 56.2 percent for the Class of 2008 and contrasts sharply with figures of 55-58 percent regularly measured in the 40 years prior to the recession.
The overall median starting salary grew by almost three percent, from $63,000 to $64,800, and the median law firm starting salary grew by five percent, from $95,000 to $100,000.
The report said it was important to note that the salary growth was measured well before the recent run-up of starting salaries to $180,000 for entry-level associates at the largest firms.
It is therefore all but certain, according to the report, that the means and medians will jump again for the Class of 2016.
Moreover, while aggregate salaries have come up somewhat from the lowest post-recession figures measured in 2011, the earning power of the class as a whole is still well below what it was in 2009 when the law firm median starting salary stood at $130,000, the highest figure ever measured. The main reason for this, according to Leipold, is that despite the recent growth in recruiting by large law firms, the number of entry-level associate positions at large law firms still remains well below what it was in 2011.
“The overall jobs profile for the Class of 2015 has improved considerably from that for the Class of 2011, the class that faced the worst overall post-recession job market,” he said. “Nonetheless, in this flat jobs market there is no evidence that the entry-level legal job market will continue to improve, or at least there can be little confidence that it will return to what it was before the recession.”
Members of the smaller graduating classes expected over the next few years “will face somewhat less competition amongst themselves for the jobs that do exist,” Leipold said, “but the ongoing changes facing the industry make it all but certain that the job market will continue to change for new law school graduates in the years ahead.”
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