Sunday, April 28, 2013
Supply-Demand Gap in Lawyers When Boomers Retire
Today, I want to focus on the potentially odd likelihood that we will have a lawyer shortage in another five to ten years. Here's why.
The Washington state bar surveyed its lawyers asking about retirement plans. The survey found that nearly one-quarter of the state's lawyers planned to retire in the next five years or about 1,440 per year. Another 32 percent of its surveyed lawyers planned to leave the profession or cut back their practices. See story here.
The Washington bar report noted that a whopping 71 percent of the state's lawyers were aged 50 or older, with 21 percent being 61 or older.
On the other hand, admissions to the state bar had not kept pace with retirement projections. Admissions dropped by 13 percent between 2007 to 2011, with about 1,200 new lawyers added each year to the rolls during that time.
I sent the report to friends that work in the administration of the Virginia Supreme Court and to friends in leadership positions in the two state bar associations. I asked whether Virginia should be doing a similar survey of its lawyers.
The data suggests that the need for lawyers will outstrip supply in the next decade, but few incentives exist in the current legal market to encourage college graduates to pursue a career in law. Data shows that, on average, about 50 percent of recent law grads will find jobs in traditional law firms. At the same time, many law grads accumulate over $100,000 of debt. The high cost of the education coupled with poor current job prospects has reduced applications to law schools by another whopping number: about 50 percent since 2004. See story here.
As noted in earlier posts here and here, changes in the legal market are propelling changes in law firm staffing models, first-year hiring, and technology use. Law firms are considering other deeply structural changes in the way they offer legal services to clients.
Oddly enough, if the current generation of law students and recent grads can tough it through the current market downturn, their mid-career options could be diverse and plentiful. However, the overall situation screams for strategic planning of your own legal career. On top of everything else that new grads must master, they must also understand the changes happening at a macro level in our profession. We are calling the situation the "New Normal."
9/19/13 Update: The National Jurist covered this story in greater depth here.