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NALP Conference Takeaways (Part II): What's Going On In The Legal Hiring Market?
One of my favorite subjects is the ever-changing legal market, and the NALP conference is a great place to get the latest data. NALP Executive Director James Leipold is a guru on this topic, and I was fortunate to attend a session where he spoke and addressed it. \par
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Before we jump in, my apologies in advance for the large amount of numbers in this post. The best way to communicate this information is in the form of statistics, and to leave them out wouldn’t do the topic justice. Also, this post could probably be an entire e-book. I have picked information to share with you which jumped out to me during the session. It is by no means everything, and I encourage you to go to the NALP website and other resources for more information if you’re interested.\par
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OVERALL MARKET INDICATORS\par
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• The entire legal employment market has only picked up 15,000 jobs since the 2008 recession (during which 45,000 jobs were lost). So we’re still 30,000 jobs below pre-recession levels.\par
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• A new pattern is emerging within (especially large) law firms. In the past, most firms tended to do well together or do poorly together, with little separation. Now, that dynamic seems to be changing. We’re seeing more winners and losers; similar firms are no longer trending as a large group, but rather some are succeeding while others are not. I thought this was particularly important for you to know, as it creates more of a burden on you (and us) to try and identify which firms are headed in the right direction and which are not.\par
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• 43% of new grads nationwide went into law firms with between two and ten attorneys. This interests me because small law firms tend to not hire student clerks. So getting a position with those employers typically comes through some sort of networking or personal referral. For those of you struggling to find summer opportunities, or not getting positions from your summer employers, it should be encouraging to see the opportunity that exists with these smaller firms.\par
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• Houston is the 5th largest legal market in the country (trailing only New York City, Washington, D.C., Chicago and Los Angeles). No other Texas city makes the top 10. This is important to know and consider. Houston is (relatively speaking) booming. And while it’s always among many of your desired destinations, I think that interest will only grow. \par
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SALARY DATA \par
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Salary data is always fascinating to look at. You can see the 2012 graduating class salary curve (we won’t have the 2013 salary data for a few more months) below, and at the NALP website here. \par
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I believe the most important fact from this chart is to look at the number of 2012 graduates earning the industry mean salary of $80,798. It’s somewhere around 3%. Taking it a step further, there are relatively few employers paying between the Big Law Firm peak of $160,000, and the “everyone else” peak of between $40,000 and $65,000 (which accounts for 51% of reported salaries). You’ll also note that at each point on the graph between $105,000 and $155,000, you’ll find less than 2% of employers. Lastly, I should explain the difference between the mean and the adjusted mean. The mean is based on all reported salaries. The adjusted mean represents a statistically created number which bridges the gap between reported salaries (which tends to come from students with larger salaries) and what the data would look like if all students reported their salaries. So in theory, the adjusted mean should be closer to reality.\par
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What should we take away from the salary data? First, that a $70,000 job offer is not insulting (I’ve heard that more than once in the past 12 months). Second, if you’re not heading to a big firm and the $165,000 payout, finding something that pays in the chart’s valley ($70k-$155k) is going to be tough. So you have to calibrate your expectations and prepare for a difficult search. For what it’s worth, I ask for salary data with every employer I visit. So if you have questions about what specific employers pay, check out my employer map and see if I’ve met with them. If so, I’m happy to provide any information they shared.\par
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STATISTICS FROM LAST FALL’S OCI\par
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•The median number of offers extended by 700+ attorney law firms to 2Ls this past fall OCI was 12 (compared to a recent low of eight in 2009, but far off the pre-recession number of 30 in 2007).\par
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•The median number of offers extended by all law firms to 2Ls this past fall OCI was 8 (compared to a recent low of seven in 2009, and far off the pre-recession number of 15 in 2007).\par
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•The percentage of 2L callback interviews resulting in offers this past fall OCI was 47% (compared to a recent low of 37% in 2009, but far off the pre-recession number of 62% in 2006).\par
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•The percentage of law firms recruiting 3Ls during OCI this past fall was 16% (compared to a recent low of 3% in 2009, and far off the pre-recession number of 53% in 2006).\par
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I think what those last four statistics tell you is what most of the data tells us. There was a low point in legal hiring during and after the recession, which centered on the 2010 and 2011 graduating classes. Since that time there has been a mild recovery, but we’re nowhere near pre-recession levels. Further, there is little to no expectation we’ll return to those levels any time soon, if ever. \par
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So there it is. Today’s legal market in a brief (though perhaps not brief enough for some of you!) capsule. As always you can connect with me at Daniel_Hare@Baylor.edu and/or @BaylorLawDaniel on Twitter.\par
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Job of the Week: Each week I highlight a job in Symplicity you might be interested in but may have missed. This week's job is: Legal Intern with U-Haul International (working remotely; 2L, 3L) Log in to Symplicity to view this job and apply.
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I believe the most important fact from this chart is to look at the number of 2012 graduates earning the industry mean salary of $80,798. It’s somewhere around 3%. Taking it a step further, there are relatively few employers paying between the Big Law Firm peak of $160,000, and the “everyone else” peak of between $40,000 and $65,000 (which accounts for 51% of reported salaries). You’ll also note that at each point on the graph between $105,000 and $155,000, you’ll find less than 2% of employers. Lastly, I should explain the difference between the mean and the adjusted mean. The mean is based on all reported salaries. The adjusted mean represents a statistically created number which bridges the gap between reported salaries (which tends to come from students with larger salaries) and what the data would look like if all students reported their salaries. So in theory, the adjusted mean should be closer to reality.\par
\par
What should we take away from the salary data? First, that a $70,000 job offer is not insulting (I’ve heard that more than once in the past 12 months). Second, if you’re not heading to a big firm and the $165,000 payout, finding something that pays in the chart’s valley ($70k-$155k) is going to be tough. So you have to calibrate your expectations and prepare for a difficult search. For what it’s worth, I ask for salary data with every employer I visit. So if you have questions about what specific employers pay, check out my employer map and see if I’ve met with them. If so, I’m happy to provide any information they shared.\par
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STATISTICS FROM LAST FALL’S OCI\par
\par
•The median number of offers extended by 700+ attorney law firms to 2Ls this past fall OCI was 12 (compared to a recent low of eight in 2009, but far off the pre-recession number of 30 in 2007).\par
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•The median number of offers extended by all law firms to 2Ls this past fall OCI was 8 (compared to a recent low of seven in 2009, and far off the pre-recession number of 15 in 2007).\par
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•The percentage of 2L callback interviews resulting in offers this past fall OCI was 47% (compared to a recent low of 37% in 2009, but far off the pre-recession number of 62% in 2006).\par
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•The percentage of law firms recruiting 3Ls during OCI this past fall was 16% (compared to a recent low of 3% in 2009, and far off the pre-recession number of 53% in 2006).\par
\par
I think what those last four statistics tell you is what most of the data tells us. There was a low point in legal hiring during and after the recession, which centered on the 2010 and 2011 graduating classes. Since that time there has been a mild recovery, but we’re nowhere near pre-recession levels. Further, there is little to no expectation we’ll return to those levels any time soon, if ever. \par
\par
So there it is. Today’s legal market in a brief (though perhaps not brief enough for some of you!) capsule. As always you can connect with me at Daniel_Hare@Baylor.edu and/or @BaylorLawDaniel on Twitter.\par
\par
Job of the Week: Each week I highlight a job in Symplicity you might be interested in but may have missed. This week's job is: Legal Intern with U-Haul International (working remotely; 2L, 3L) Log in to Symplicity to view this job and apply.
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