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Every Day a Legal Revolution: The ATL Effect

Dave Hoffman

Dave Hoffman is the Murray Shusterman Professor of Transactional and Business Law at Temple Law School. He specializes in law and psychology, contracts, and quantitative analysis of civil procedure. He currently teaches contracts, civil procedure, corporations, and law and economics.

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8 Responses

  1. Brian Tamanaha says:

    Dave,

    You are on solid ground when you suggest that law schools are likely no better and no worse than twenty years ago in training lawyers (indeed one of the complaints about law schools is that we have not changed much over time–that is, aside from professors teaching less and writing more, and tuition increases far above the rate of inflation).

    But your comments about the job market for lawyers strike an odd key. There is no doubt that the job situation is terrible–with thousands of layoffs, rescinded offers and delayed start dates, cancelled summer hiring programs, reductions in the number of new hires, many recent graduates without jobs, and many experienced and new lawyers taking low paying temp jobs with no benefits.

    Under these circumstances, asking whether the job situation is “distintively or structurally bad” seems besides the point. And your question can be evaluated only in hindsight, since we have yet to see how it will all shake out.

    You are correct to remind us that it is prudent to separate the noise from the reality, but in this case the reality is painfully real. I don’t know how bad things were in 1991, but there is plenty of evidence that things are extremely bad now–and that’s what matters.

    Brian

  2. dave hoffman says:

    Brian,

    Whether the current job market for lawyers necessarily bodes something grim for the future job market for lawyers is something we can’t yet evaluate. But asking that question is necessary, and it doesn’t mean I lack sympathy for those who are the victims of the current recession.

    The point of my post is that the structure of the internet tends to exaggerate present trends and may make things feel worse than they are – just as it makes us feel that there is more political radicalism today than in the past. When ATL and other blogs were focused like lasers on increasing salaries and bonuses, in retrospect that was an unhealthy and distorting trend. So, of course, are law professor blogs breathless focus on UNWR rankings, their relationship to other silly measures, etc., which encourages all kinds of inefficient resource allocations as well as lying about the numbers.

    Now it may be that most of the jobs aren’t coming back. If that’s right, then many of us teaching law schools are (let’s face facts) the current beneficiaries of an unraveling ponzi scheme. If, on the other hand, we’re losing some perspective, then we can give a different set of advice to those people thinking of becoming lawyers. So it’s useful to simply say that the present cratering of the job market has precedents. But we don’t know what’s coming next, because we don’t know if the fundamentals have really shifted (as Bill Henderson argues) for most lawyers.

    None of this at all discounts the gravity of the present mess for our students and graduates and colleagues. It’s awful, even for those who have jobs. Insecurity, fear and disappointment are the dominant themes from folks in my inbox. And anger. But let’s try to be clear eyed and think about what’s coming next.

  3. Brian Tamanaha says:

    Thanks, Dave, for the elaboration on your post. I don’t doubt your concern about the lawyers and law students suffering through these uncertain and difficult times.

    To give sound advice to prospective law students, however, I don’t think we need to know whether current events mark a fundamental change in the legal market. For graduates from schools outside the top tier (and for those not in the top of the class at other schools), the job situation has long been difficult. The only difference now is that it is much worse.

    Law schools need to spell this out in very clear terms to prospective students. We can start by honestly stating what percentage of the class fails to land lawyer jobs within one year of graduation; and by honestly stating the percentage of employed students who earn under (say) $50,000.

    Perhaps the most angry complaint about law schools is that we actively distort or hide this information. (GUILTY!) I suspect that for most law schools these numbers would be sobering enough to give prospective students pause before signing up for another $100,000+ in debt.

    We should advise prospective students (at least outside the top tier schools) that they should attend law school today only if they have a deep commitment to the law to becoming a lawyer.

    Brian

  4. harrump, ahem, toodle-oo, I dare say, jolly old chap….

    We are so very upper class here. So very Ivy League. We solve all the problems of the legal professional elite here. Ahem. Jolly good show. Ahem. harrumph. Fetch us a snifter of brandy and a cigar, that’s a good chap.

  5. dave hoffman says:

    Brian:

    Yup, law schools should disclose more, and disclose more clearly. Won’t happen absent regulation.

    Lawschoolscam buster: Look, I just finished my cigar, and I’ve written some pretty obscure scholarship today on topics that no one cares about. Do I really have to have the brandy too? It makes me queasy. Can’t I just wear an ivy league t-shirt and read Gibbon quietly to myself?

  6. Java Master says:

    I remember 1991-92 very well, as I was dismissed from my law firm (my billable hours were down, they said—-of course they were, two of our largest clients,one a major regional bank was taken over by the FDIC, and a well-known real estate development company had cratered). It was extremely difficult finding new employment as an attorney, but I was most fortunate to have a client who remembered my work for them, and referred me to another firm that they retained. After several months without “real” work, I joined this new smaller firm , which subsequently merged into a another Big Law firm and I found myself doing–of all things–structured finance and I.P.O’s! Well that lasted until about 2001 ! Talk about being snakebitten!
    Plenty of mid-level associates, senior associates and young partners from firms large and small found themselves unable to re-invent themselves as I did. Occasionally, I still hear from one or two of my former colleagues, all of whom left the law well over a decade ago. So the recessions of 1991 and 2001 truly did take a toll on some people’s careers. But this is different–the depth and extent of the legal recession are truly profound, and the prospects for laid-off lawyers are gruesome. My current practice is hanging on by a thread, these are not happy times to be a middle-aged lawyer.

  7. A.J. Sutter says:

    I agree with Java Master. The nature of law practice has changed for everyone. And this change is real.

    I started in this profession (though ‘industry’ might be a less quaint term) as a paralegal in a Wall Street firm in 1978, where thanks to mentoring I got to know many of the senior partners in the firm. My first job as an associate was there, too (class of ’83). I recently visited some of my friends who are now senior partners there themselves. One of them is still behind all the piles of paper he had on his desk in his last year as a senior associate. Another friend who’s my age and was managing partner of the Silicon Valley office of a multinational, told me a few years ago he’d fallen asleep standing up while playing catch with his kids. Even for Big Law partners, life is much less stable than it was 30 years ago.

    The causes of this are manifold — expectations created by new communications technology, shift to price-based competition, the paradigm shift of the Mike Milken/Gordon Gecko years, etc. — but the effect is real. Rather than an ATL effect (absent in my case, since ConcOps is the only law blog I read regularly), you might look to the AmLaw effect (started as a “rag” in 1979). Of course greed helped too, but in the 1980s AmLaw was a major force for popularizing a single-minded approach to law as a for-profit business. More recently, the rise of neoclassical economics in law schools has no doubt played a contributory role.

    After 30 years, where has that left us? If you’re a middle-aged lawyer without a job, the situation has been bad since the dot-com bust. Even 5 years ago, it was pretty impossible to find a job if you had more than 15 years’ — or even 10 years’ — experience but weren’t at that moment either a GC somewhere, head of IP, labor, litigation etc. in the law dept. of a Fortune 200 company, or already had at least a $1-$2 million portable book. Once you pass 50, you have little choice but to go solo. And BTW I was lucky enough to have to have gone to an Ivy League college, graduated from a top-20 law school at the time (since then lower), paid off my loans long before, and to have spent most of 20 years at big firms and multinational companies. (I’ve been lucky in many other ways as well, so on balance I remain glad to have become a lawyer — this is not a rant, just realism.)

    As for younger lawyers, it’s true that things have long been exploitative. On a lateral interview in 1987, I asked a partner why they were looking to hire (office of an English firm in L.A.); the guy, a John Cleese-lookalike, raised an eyebrow at me as if I were a moron and said, “Well, obviously, to fill in the interstices of our pyramidal structure.” But at least (i) the response was shocking for the era, (ii) the job paid well, (iii) it came with benefits, (iv) it had some prestige, and (v) I got a better offer elsewhere a week later. Same has not been possible for a while. And as I noted in a different thread, the temp and part-time segment, which came to prominence in the 1990s, has become especially brutal since the end of the dot-com era too — just when more people depend on it to survive.

    Brian refers to “a deep commitment to the law to becoming a lawyer.” Does this commitment mean indifference to earning a living? Should law be like publishing, where only people who don’t need the money can afford to go into the profession? What law schools can do about the current demand-side problem may be somewhat limited. But I’m inclined to agree with those who say that some schools’ institutional rationality is leading them to admit too many students, or even to stay in business longer than they should.

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