Study: Average price of a JD drops amid declining class sizes, costing $1.5B a year in lost tuition
Law schools have cut class sizes and offered tuition discounts that lowered the average inflation-adjusted cost of a law degree by 6 percent from 2010 to 2016, according to a new study.
The result: ABA-accredited law schools are collectively losing an estimated $1.5 billion a year in tuition in current dollars from an inflation-adjusted high in 2011-12, the study found. Law.com has coverage of the study, conducted by two law professors and an economist.
The study found that declining class sizes had a trickle-down effect, with rejected applicants from higher-tier schools filling slots at lower-ranked schools. The study authors conclude that effect likely saved 20 weaker law schools from closing.
Even so, the effects of declining revenue “have been somewhere between significant and devastating,” the authors write. “There is no more time to pretend that this demographic and economic transformation is just some transient episode that can simply be waited out.”
Law schools cut class sizes in response to a substantial falloff in the number and qualifications of law school applicants that began after 2010, according to the study, set for publication in the Nevada Law Journal. The authors are former University of North Carolina law professor Bernie Burk, University of St. Thomas at Minnesota law professor Jerome Organ, and Duke University economics professor Emma Rasiel.
The study’s tuition numbers are based on data from ABA-accredited private law schools, beginning with the academic year 2010-11 and ending with the academic year 2016-17. Public law schools were excluded because they charge differing tuition to in-state and out-of-state residents, and don’t disclose how many students fall in each category.
During that six-year period, the number of unique applicants to accredited law schools fell 36 percent, and the number of applicants with scores greater than 160 on the Law School Admission Test fell 46 percent. The average law school entering class dropped by nearly a third and its median LSAT score was seven percentiles lower.
Though base tuition rose 15 percent, average net tuition after discounts at the private, accredited law schools fell more than 6 percent in constant dollars. The study notes that most student aid is merit-based, meaning that the weakest students likely receive the least aid and pay the highest tuition. Those students, especially those at schools with weaker reputations, run the highest risk of failing to find a law-related job.
As a result, “students who pay the most for a legal education generally are least likely to be able to make any direct use of education they have paid for,” the authors say. “And even if they do find a law job, they are least likely to find a job that economically justifies and supports the amounts they paid.”
Law schools with better reputations didn’t take the same financial hit as other law schools. Among the top one-third of law schools, entering classes shrank an average of only 13 percent and dropped three LSAT percentiles. Outside of the top-reputation law schools, tuition revenue dropped more than 40 percent on average, costing most schools $11 million to $12 million per year for each law school.
The number of law school applicants increased 8 percent for the fall 2018 entering class, Law.com notes. But Burk told the publication that any increase in enrollments won’t be high enough to match law schools at their heyday in 2010.