How Should We Count the Unemployed and Students Seeking Advanced Degrees in Assessing Job Equilibrium for Law School Grads?

Counting the Unemployed

Here’s the next question?  Do we adjust the data predicting a job equilibrium as early as 2015 and as late as 2021 by accounting for law graduates who do not fall into the categories of "employed" grads? 

These "unemployed" grads have:

• Enrolled in a full-time advanced degree program, like an LL.M;
• Are not working and instead are studying for the bar exam full-time;
• Are not working and not seeking employment (perhaps a new mom or dad, for example); or
• Are not working, but seeking employment.

NALP first began tracking the ranks of the “unemployed” for the graduating class of 2003.  

I continue to use the NALP data, despite Professor Merrit’s comment that it is off by a year when compared to the ABA data.  Again, I am looking for trends and averages.  I also like knowing both the total number of graduates and, more importantly, the number of graduates responding to the NALP employment survey. The second number changes the denominator when calculating percentages.

The data can be found here organized by each graduating class.  I have relied on two documents:  the "Selected Findings" and the "National Summary Report" for each class.

	Grads Reporting Employment	Enrolled in Adv. Degree Program	# Total Not Working	# Studying for Bar	# Not Seeking Employ- ment	# Seeking Employ- ment	% Not Working
2003	35,787	964	3,011	829	763	1,419	8.4%
2004	36,834	911	3,170	1,110	758	1,302	8.6%
2005	38,951	852	3,187	1,178	815	1,194	8.2%
2006	40,186	889	2,832	868	860	1,104	7.0%
2007	40,416	931	2,362	NC	692	1,670	5.8%
2008	40,582	977	3,108	NC	936	2,172	7.7%
2009	40,833	1,247	3,540	NC	1,110	2,430	8.7%
2010	41,156	1,214	3,899	NC	1,330	2,569	9.5%
2011	41,623	936	5,034	NC	1,044	3,990	12.1%
2012	44,339	928	5,669	NC	922	4,747	12.8%

Notes to table:

• The total number, and percentage, of grads "not working" does not include those grads pursuing an advanced degree or those grads employed part-time (or, obviously, those grads employed full-time.)
• The number of 2012 grads seeking employment does not include 204 grads with employment start dates after February 15, 2013.  NALP first reported this new category in 2012.
• After 2007, NALP quit using the category that identified graduates studying full-time for the bar exam. 

In making my quick calculation of the year in which new jobs might exceed new law grads, I assumed 100 percent employment rates.   (My calculations were intended as a ball-park analysis.  Had I known they would have drawn as much attention as they have, I would have spent more time on them.)

Luckily, my posting encouraged a deeper view of the data.  However, Prof. Merritt’s analysis also assumed a 100 percent employment rate within nine months of graduation. 

The latest study, reported in the December 2013 issue of the National Jurist, notes this assumption and says:

But since NALP began tracking data in 1985, the percent of recent graduates who were employed in full-time legal jobs has never exceeded 84.5 percent.  In fact, from 1998 to 2008, it averaged 75 percent.  That is because many graduates get jobs after the nine-month mark, and others choose not to pursue full-time or legal employment.

(Emphasis added.)  Taking account of historical unemployment data, the National Jurist predicts job equilibrium for the (entering?) Class of 2016, defined as 75 percent of grads employed in full-time legal jobs.   That prediction assumes new job growth remains flat.  If job growth increases, the equilibrium would come for the (entering?) Class of 2015.  The article does not make clear whether these statements apply to the entering class for those years or the graduating class for those years (as my calculations did). 

National Jurist expects to provide a chart of the data in its January issue.

Note that in making this prediction, the National Jurist apparently goes one step further than I have in this posting by including in the "unemployed" category those grads seeking advanced degrees and grads employed part-time.  Also, without spending more time with the NALP data, I can't tell whether National Jurist includes JD Advantage jobs in the category of "full-time legal jobs."  The promised chart may answer these questions.

In 2012, the percentage of grads reporting part-time employment held jobs in the following categories:

• Bar Passage Required -PT   4.4%
• JD Advantage -PT               3.0%
• Other Professional - PT       1.0%
• Non-Professional - PT         1.3%
• Job Unknown - PT               .01%

Total part-time:                             9.71%

In any event, despite all the errors I made in my own calculations trying to support Professor Organ's prediction, the ultimate prediction of an equilibrium for the graduating Class of  2015 or 2016 appears accurate depending on how you define "employment."

I invite other bloggers to work with these numbers and to clarify the situation using various assumptions.

Dec. 27, 2013:  One blogger, Matt Leichter, of the Law School Tuition Bubble blog,  has continued to work with the numbers and published a story in the AmLaw Daily here.