Guest contributor Natasha Petrukhin weighs the pros and cons of getting a law degree (and the debt that comes with it) as attorney job prospects become more scarce.
Thousands of newly minted law school graduates across the country are facing a new financial reality this fall. Without even knowing whether they’ve passed the bar, grads are being contacted by banks to remind them their student loan grace period is almost up. And since the typical grad is spending more than 10 months looking for a job, in many instances, the grace period ends while the graduate is still unemployed.
So with payments ranging from $1,200 to as high as $2,500 per month, the question has to be asked: is the education worth it?
In the long-gone boom days, law firm jobs were plentiful; most graduates could quickly repay their loans. But today, even with a drastically different economic landscape, law schools have yet to adjust their tuition rates, and incoming students have yet to adjust their post-graduation expectations.
In other words, for anyone considering law as a profession, it’s important to examine whether becoming an attorney is worth your time and money.
Personally, I graduated college with a liberal arts degree and felt I had two choices: go into finance or apply to law school. As appealing as spending years in front of an excel spreadsheet crunching numbers seemed, I decided to tackle the LSAT and apply to law school instead.
Unfortunately, I didn’t think to conduct any sort of cost-benefit analysis. I figured that if I did well, studied hard, and didn’t do anything particularly egregious during my summer internships, I would be assured a full time offer by the fall of my 3L year. Not the best assumption, as it turns out.
Had I been a bit more aware of the legal market, I would have asked the following questions.
Is Law School a Smart Investment?
Depending on your living expenses, a typical law school education today costs upwards of $200,000 – give or take a few thousand. So if I remember my undergrad econ classes, in order for a legal degree to make financial sense, not only do you need to estimate your future earnings potential, but also compare that with the salary you could earn if one stayed in the job force for 3 years.
Examining the salaries of graduates coming out of law school, there seems to be a disconnect between the schools’ projections of their grads’ future earnings and statistics gathered by the Bureau of Labor.
Case in point: most law schools project a $160,000 annual salary in the private section. The Bureau of Labor, on the other hand, puts the number closer to $100,000.
Also, you should note that the large salaries quoted on law school brochures are in reference to securing a job with a “biglaw” firm (firms with over 101 attorneys). The reality is, those types of firms represent only 1 percent of all firms in the US, and according to NALP, more than 80% of working attorneys are in fact employed in firms with 50 people or less.
But even if we take that law school number on it’s face — and remember, it’s on the high side — the average law school alum will have a debt of $200,000 and a salary of $160,000. If we use the Bureau of Labor averages, you’re looking at the same $200,000 debt and a salary of roughly half that (and that’s before taxes!).
Doing the math, I’m reminded of an article by Professor Herwig Schlunk at Vanderbilt Law published in 2009. Schlunk concluded that a law degree is probably not the best vehicle if you are seeking a return on your investment.
With numbers like the ones above, that’s hard to argue.
Becoming Gainfully Employed… as a Barista?!?
While I was still in law school, the New York Times published an article, “Is Law School a Losing Game?” It caused mild panic amid the ranks of my unemployed classmates. Visions of competing for temp jobs and vying for barista positions at the local Starbucks swam in their heads.
However, with the U.S. unemployment rate for attorneys only slightly improving from 2009’s all-time high of 2.3% to 1.5% last year, future law school grads might be looking at early mornings makin’ soy lattes to cover their student loans.
So, I repeat… Is it worth it?
If the question is whether someone should go to law school, the answer is the lawyer’s most trusty response: it depends.
You need to ask yourself: what are your motivations for applying and what do you hope to achieve with the degree? I believe a law school education is an invaluable tool that has taught me to write and think critically, skills that are applicable to anything I’ll ever do.
I knew from the start that I wanted to become a lawyer. So while my post graduate experience so far hasn’t been a predictable path, I can certainly say that if given the choice I would not do anything different (except maybe play the lotto more). But that’s just me.
Just keep in mind that a realistic assessment of your financial situation is beyond important. So is having a firm understanding of the financial obligations that will come hand in hand with your J.D.
Make sure you weigh the costs and the benefits, because the jobs that used to be waiting for recent grads are getting harder to find. The debts for recent grads, on the other hand, are just getting bigger.
About the Author
Natasha Petrukhin is a recent Fordham Law School graduate with a background in corporate and intellectual property law. Having previously spent time in the Silicon Valley, Natasha continues to pursue her passion for entrepreneurship while currently living and working in New York. In her spare time, she enjoys running, re-watching Arrested Development, and vicariously living through the blogs of great cooks.
Are you a recent grad who has taken an alternate career path after graduating with a JD? Do you think your law degree was worth the cost of tuition? Are you considering law school but scared of the cost? Chime in below with your two cents in the comments.