Is Law School a Good Deal?

Don Lapre, late night infomercials, and multi-level marketing . . . a lot of schemes promise all but instant riches, but does attending law school create the same allure for higher educated individuals as those same rip-offs that sucker the uneducated and often unwary populous?

I can’t begin to recount how many of my friends – especially those younger than me – are enamored with “becoming a lawyer” and “going to law school.”  For many, it’s the pursuit for the holy grail capping off a solid undergraduate education to a career that promises prestige and wealth.  Many of them already know what they want to practice.  Oftentimes, it’s in a sexy field – entertainment law, complex civil litigation, in big firms with white shoes paying six figures.  The hardest part, they believe, is just crossing that threshold: admission to law school.

Fortunately for the star-crossed students-to-be, there is no shortage of law schools opening the doors to allow them to accomplish their lofty dreams.  Unlike medical school where admission is ultra-competitive throughout the county, law schools peppering the landscape fall along the spectrum of über-competitive to those affectionately labeled “TTT” – third tier toilets in terms of  “quality”.  The latter is apportioned infamy by admitting those students with low LSAT scores and GPAs.  Often, the cost of attendance at these institutions rival those in the upper echelons.  Case-in-point, tuition at Thomas Jefferson School of Law is set $41,000 for the 2011-2012 academic school year.  The list price for Harvard Law School is slightly more expensive – $47,500.

The Illusion

Large numbers representing the capital outlay for a law school tuition are but a drop in the bucket when the shiny employment numbers show that graduates will land six-figure jobs straight out of school.  At first glance, these numbers are dizzying.  When I finished undergrad, the economy was booming and companies couldn’t hire fast enough.  Shortly after graduating in late-2006, I landed job as an insurance adjuster.  It was the first time I received a decent paycheck – and it was a big jump from my old job working during school making ten bucks an hour.

From a career standpoint though, where I was – insurance adjuster – was not where I wanted to be – i.e. making substantially more than my current salary.  Plus, I  felt like I needed a “useful” degree.  Engineering didn’t work out for me; I’m not sure I would have kept my academic scholarship had I continued down that path.  I graduated with a generic liberal arts degree with a decent GPA.

A law degree conveyed an appeal as much more of a “useful” factor than other degrees (e.g. M.A. in English).  Sure, law school was expensive, but who cares when who cares?  Considering the financial rewards from graduation, law school seemed like a great investment.

Debt Is Real

But law school isn’t all Candy Cane Forest with the Gingerbread People being lectured by Lord Licorice.  One cannot ignore the price tag, particularly when a three year investment can land a graduate with a six-figure mind-mortgage.  Students with lofty ideals are often oblivious to the dark side of law: crushing debt.  I’m not in a position to point fingers: law schools publish tuition costs, financial aid packages, and average debt at graduation.  Prospective students are already college-educated, sophisticated consumers making supposedly rational decisions about a future career.  Couched in that light, it’s hard to pity an individual that thinks the best way to get to Gumdrop Mountain is to climb a huge mountain of debt.

Student loan debt an invisible albatross that hangs on the necks of students all across the nation.  It’s just that with law school, this albatross is much larger than those that stop climbing after four years of higher education.

Prospective law-student eyes often glaze over when they already believe (rightly or otherwise) that a degree with “J.D.” means easy money.  Ironically, “J.D.” is synonymous with “easy money”; it’s just that it’s easy money for the law school institutions themselves.  After all, with an influx of applicable candidates willing to throw tens of thousands of dollars toward piece of paper that purportedly garners even more fame and wealth, law schools are eager to take this money.  Considering the new buildings and state of the art facilities law schools sport, there isn’t any doubt that this is exactly what is happening.

The Legal Landscape

“You’ve been living in a dream world, Neo.”  No bones about it – the legal market is tough, and to succeed, one must be resourceful.  If I could offer one piece of advice to people considering law school it would be this: there are no guarantees.  Those six-figure jobs aren’t handed out like candy on Halloween.  If anything, students with this mentality quickly discover that it’s much more “trick” than “treat”.  With a limited number of big-firm jobs, many members of a law school class is all gravitate to the same firms.  Of course, law school grades operate on a curve – so unless one does substantially better than one’s peers, those attractive jobs are quickly snatched up by those at the top of the class.  In a perverse way, marginal students can often suffer.

As a general rule, students often try to gain entrance to the best ranked school that will admit them.  The benefit, of course, is that higher name recognition may open up more doors than a no-name institution.  The down-side, however, is that those that barely make it into these reach schools are often pitted against other students just as qualified.  It’s a highly-educated glorified dog fight for class ranking.  A marginal candidate for Yale might be a superb fit at a local state school.  Of course, choosing too low of an institution may create more of a stigma than a benefit when it comes for looking for jobs.  And with grades, it can still be a crap shoot.  Again, no guarantees.

When the economy takes a hit, the legal economy takes a larger hit.  Plenty of bloggers far more erudite than I probably could expound the reasons behind this phenomena, but the legal market is in a world of hurt right now.  More depressing, law schools are still pumping out graduates and outstripping the demand for legal positions.  One downside of an over-saturated market besides wage depression is the lack of available jobs.  In a law school graduating class, students experience a trickle-down effect.  When large-law employers reduce the number of new hires, students toward the top of the law school class then take jobs that were traditionally less competitive – clerkships, government and public-interest positions.  Those graduating toward the lower end of the class then compete with higher-ranked students for positions sporting a low pay.  All else equal, the higher-ranked students will snag those the less desirable positions to at least have a job, thus leaving the dregs of the class in a feeding frenzy to compete for anything law related.  Even unpaid positions.

Unfortunately, while jobs disappear, the debt accompanying recent graduates does not.  Uncle Sam understands hardships, but he also understands that the debt must be repaid.  And it won’t be discharged in bankruptcy.

Is Law School a Good Deal?

It would be unfair to categorically state that law school is a net positive or a net negative.  Realistically, many students get hosed with debt and I know a number of students that either 1) have legal jobs that regret going to law school or 2) do not have jobs.  It’s sad really – particularly when the appeal of a legal degree wears off and the reality of long-hours, potentially low pay, and that lenders expect payments for the next ten or twenty years of one’s life.

To be fair, this tough reality isn’t unique to the legal institutions; it’s just that the legal field – law schools in particular –  continually raise tuition prices and send more law-trained students into the marketplace with a pile of debt with increasingly difficult opportunities to succeed.  The pretty six-figure jobs still exist; they are just more competitive and the return on investment with a law-degree may not be as great as taking that $150,000 for a legal education and investing it in the stock market – or housing.

While I don’t want to completely dissuade those from entering the legal field, I do want to underscore the risk and debt incurred with its undertaking.  The end result isn’t always a pot of gold at the end of a three year rainbow.  It’s quite possible that after finishing those three years, the students with shiny new “J.D.” degrees will wake-up and realize that they are in the same position as those that society criticizes for following those get-rich-quick schemes.  The difference, however, is that everyone in the former-category already possesses a four-year bachelor’s degree.  Education, is seems, is no substitute for common sense.

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