The Pipeline into the Legal Profession

The current challenges to legal education are a result of the profound changes in the legal marketplace. They have not arisen in isolation. The problem is the pipeline into the profession. The traditional progression from student to associate to partner is no longer optimal for the client who is being served.

The expectations for the education of new lawyers are increasing, but the willingness to pay for the process is decreasing. The issue is who will pay for much-needed training. Either before the bar exam or shortly thereafter, a lawyer must learn basics such as how to draft a complaint and a contract, how to interview a witness, what a financial statement indicates, etc. Preferably well before matriculating in law school -- though this cannot be counted on -- she should know how to write competently in standard English.

Almost all of the responsibility for book learning has been accepted by schools. That's not the issue. It's the development of practical skills that's at dispute. More to the point, it's the price of that education that has become contentious.

The tab could be picked up by any of the following in combination: the clients, the firms, the students, or the public. The issues of who will impart the skills and how best to do it are not trivial, but it is the costs which are most controversial.

Clients with market power say emphatically that they will not pay for associates to learn the requisite skills.

The big firms historically had passed on the costs, in a manner that distributed them. A new associate was not worth her billing rate at the outset, but her time was tucked away on an invoice that would be paid because if you wanted a high-end firm doing your work then that was the cost.

The small firms and mid-size firms, which are much more the norm than the big firms, may have had less formal orientation programs but they have more side-by-side collegiality. They absorbed the cost themselves, in the form of lower compensation all around for partners and associates.

As firms of all types try to assign this instructional role to schools, the schools typically pass the burden on to the students. Thus the cost of the clinic is covered by an increase in tuition.

The alternative of public support likely will not appeal to the taxpayer. The government, however, could do more through robust state appropriations for the educational system, direct subsidies for post-graduate public service, or a Gideon right-to-counsel in civil cases that would create jobs.

To start addressing the problem, it is necessary to identify it. Here is an effort at a neutral description. We have a series of vicious cycles that interlock and ratchet.

Law firms have become much more business-like. They have raised their billing rates as high as they can.

Clients have balked. They too are more savvy. Corporations have their own general counsel who has come from a law firm and knows its tricks. As the most senior partners charge more, in-house counsel have responded by agreeing to pay on the condition they actually receive the benefit of that specific person's expertise. The senior partners can command their rate of more than a thousand dollars per hour, but only by foregoing the the revenue of a half-dozen associates supporting them.

Law firms also have a new model. The pyramid structure is no longer stable. That system, with large numbers of associates being winnowed out to leave a few who would make partner at the seven year mark, was always a Ponzi scheme -- except there was no fraud because the arrangement is disclosed.

Law firms are trying different configurations. They have contract attorneys and others who will never own equity in the business. These individuals receive a level of training appropriate for their roles, but they don't expect the genuine mentoring that would be given to someone who will become an owner of the company.

Culture has evolved as well. Since Curt Flood challenged the feudal system of major league baseball two generations ago, every professional has become a "free agent." The most ambitious associates are smart enough to see their opportunities will be constrained if they remain in place for too long. Their very human reaction to the lack of loyalty shown to them as employees is to reciprocate, by becoming less loyal to employers in turn.

The most elite firms have a remedy. It is the recruitment of already experienced attorneys, in preference to new graduates.

But this approach only works for the firms at the top of the market and it will be effective only until the supply runs out. Somebody has to hire new lawyers to ensure we have experienced lawyers. Eventually, thanks to the increasingly restricted access to the court system, there won't be many lawyers with real trial experience.

The more firms compete to attract laterals through compensation, the more internally stratified they become. The more stratified they become, the less they invest in growing their own juniors. And so on.

Finally, the preparation to be a lawyer is more difficult because the law is more complex. Fifty years ago, there were fewer statutes, regulations, and cases. A lawyer litigating a dispute did not worry about investigating email and social media. A lawyer drafting a contract gave no thought to whether it would be enforceable in China.

We collectively have become dependent on circumstances that will not last much longer. The crisis for legal education is a portent.