It’s hard to believe I’m saying this, but I think it’s law students. More specifically: law students at the top schools who have at least decent grades and resumes. And the main reason is simply that there are fewer of them. The ABA announced this week that law school enrollment has slipped further this year, down 4.4 percent from 2013. In the fall of 2014 there were 37,924 full- and part-time 1L enrollees, compared to 39,675 in the fall of 2013. This is the lowest number of first-year students since 1974. Total enrollment is down as well, the lowest since 1987, when there were fewer ABA accredited law schools (175) than there are today (204).
The historic high for 1L enrollment was in 2010, when 52,488 J.D.s were enrolled in ABA-approved schools. Today’s number is a 27.7 percent decrease from that figure. But not every school saw a drop; 69 schools saw their first-year class increase since last year, and 33 of those saw an increase of more than 20 percent. These are the schools that are winning the war over the dwindling number of well-credentialed applicants, and it is these top applicants that will have their pick of the litter when it comes to BigLaw job offers.
So yes, the popularity of a legal education continues to decrease, as does law school revenue. But on the other side of the fence, growth continues. A new report released by Citi Private Bank and Hildebrandt Consulting predicts 5 percent profit growth for the law firm industry in 2015, close to 2014 levels. The report also finds a widening gap between the most profitable firms—typically those with big-name transaction practices—and everyone else. Firms that rely heavily on litigation to drive revenue are having a harder time right now (unless their litigation practice is flush with IP patent prosecutions or investigations). Yet on the whole, this is good news for the corporate law world, and even better if you are graduating from law school in the next couple years from a T-14 school. You will be amongst some of the smallest law school classes seen in decades and hopefully, firms will be fighting over you join their junior ranks. And if you accept the temptation, you will reap the benefits of your hard work, if this year’s bonus numbers are any indication.
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