Blame it on BigLaw: Firms of 100-plus lawyers cut hiring the most, creating ripple effect

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Legal employment for new lawyers plummeted after the recession, but larger firms were responsible for a disproportionate share of the reduced legal hiring, according to a law professor’s analysis.

Law firms of 100 or more lawyers were responsible for more than half the entry-level law jobs lost since 2008, according to a review of employment numbers by University of North Carolina law professor Bernard Burk. His paper can be downloaded here.

BigLaw hiring of new lawyers fell by more than one-third “during the recent tumble into the New Normal,” Burk writes in a paper. Meanwhile, hiring of new law grads at firms with less than 100 lawyers fell by about 5 percent, as did hiring in non-law-firm categories including business, judicial clerkships and public interest.

“While other sectors of the market for new lawyers have changed only modestly during the Great Recession,” Burk writes, “one sector—the larger private law firms colloquially known as ‘BigLaw’—has contracted six times as much as all the others.”

The National Law Journal and the Wall Street Journal Law Blog (sub. req.) have stories on Burk’s conclusions.

Burk says the BigLaw contraction in hiring has had a ripple effect. Well-credentialed grads who don’t obtain BigLaw jobs, he writes, “tend to displace the somewhat less well-credentialed candidates who had generally occupied that next-most-sought-after tranche of jobs, and so on down the line, until the least-employable candidates who generally occupied the least-sought-after law jobs get pushed out of law jobs altogether into less- or non-law-related positions or unemployment.”

Burk also reviewed the “law-jobs ratio” for graduating law classes during the past 30 years. The figure represents the portion of the graduating class that has obtained law jobs within nine months of graduation.

The best law-jobs ratio was about 80 percent, and it was recorded in 2007. It indicates that “at the peak of the market, one in five graduates still failed to obtain a law job within nine months.” The ratio dipped or slowed its rise during recessions of the early 1980s, early 1990s and early 2000s before recovering. Is the latest dip also temporary?

Burk doesn’t think so. He notes changes affecting the legal jobs market, including outsourcing and clients who have grown “increasingly restive about paying what became $250 or more per hour for what often amounted to legally literate clerical work.”

He does, however, have one prediction that will please law students. Law schools are enrolling fewer students. If the trend continues, that will improve employment prospects for students who begin law school three to five years into the future.

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