Tuesday, June 25, 2013

"The New Normal": A Warm Welcome to Our 60 New Readers from Weil Gotshal


"Law Firms Hiring!"  by JD Journal (June 25, 2013)

Money Quote: "Law school graduates can expect better returns, better job opportunities, and overall more hiring by larger firms."

Wait for it.

*****

"Large Firms in a Hiring Mood Again," by Karen Sloan (National Law Journal, June 24, 2013)

Money Quote: "The country's largest law firms are wading deeper into the new associate hiring pool -- a welcome development after years of recruiting declines."

Wait for it.


*****

"Mass Layoffs at a Top-Flight Law Firm,"  by Peter Lattman (New York Times DealBook, June 24, 2013)

Money Quote: "'While we have been able to avoid these actions in the past, and it is very painful from a human perspective, the management committee believes that these actions are essential now to enable our firm to continue to excel and retain its historic profitability in the new normal,' Barry M. Wolf, Weil's executive partner, wrote in a firmwide e-mail."

"The 'new normal,' in the view of Weil's management and echoed by legal industry experts, is that the market for high-end legal services is continuing to shrink. Dan DiPietro, chairman of the law firm group at Citi Private Bank, said he believed that the profession could experience a wave of job cuts. He said that there were too many lawyers at the country's largest firms, estimating the excess capacity at as much as 10 percent of the lawyer population."

Boom. So much for "Law Firms Hiring!"

*****


Money Quote: "It comes down to this: firm leaders know that regardless of how they treat young lawyers, numerous replacements wait for their turns in the increasingly fragile big-law barrel. Meanwhile, the profession's existential crisis continues as intergenerational antagonisms fester. Except for the relatively few partners at the top, this can't end well."

No, this is not going to end up well. Expect an uptick in our readership soon. Very soon.

*****

"UC (University of Cincinnati) Trustees to Cut Out-of-State Tuition for Law School," by WKRC Cincinnati

Money Quote: "University of Cincinnati trustees are expected to approve a big cut tomorrow in out-of-state tuition for the College of Law. It's an effort to attract more students from around the country. Tuition will be more than 30-percent lower, almost 29-thousand dollars less per year. Applications to law schools in Ohio have declined 27-percent since 2008. There are only nine law students at UC currently paying out-of-state tuition."

I'd be fairly pissed if I were a recent out-of-state UC Law grad. Just sayin.

*****



Money Quote: "Many prospective law students want to get rich. They cannot be blamed. There is the consideration of high salaries down this career path. However, not every lawyer will find his or herself making a $500,000 salary within a year of graduating. Many lawyers enjoy median incomes, and this fact should definitely be appreciated. Salary alone and its lovely prospects should never be the only reason one joins a field."

I can think of quite a few more questions to ask myself.

*****

"Feds Flag 126K in Student Loan Fraud Crackdown," by Newser [linking to Wall Street Journal (paywall)]

Money Quote: "'What we find are very poor students academically that are borrowing to the max, getting the maximum in their Pell grant and just going from school to school,' says a financial aid director at Maryland's Anne Arundel Community College. Adds another: 'We have individuals that told me, 'I spent all this money on graduate school. I can't get a job. I can't afford to live, I need the money.' It's not so much about the education, it's the money.'"

These students obviously should have enrolled in POV 575 Lawyers in Poverty to assist with their transition into poverty living.

*****

"So Now You're a Harvard Lawyer -- Now What?" by Jeffrey Toobin (Commencement Speech Edited by LawFuel Editors)

Money Quote: "2013 is not the greatest time in history to graduate from law school. The legal economy is changing, and it's hard to think it's getting better. There are no guarantees anymore, not even for Harvard lawyers."

Especially for Harvard lawyers at Weil Gotshal.

8 comments:

  1. The fact that the legal economy is in decline is a very important point, as is the imbalance between the supply of lawyers and demand. If you are going to law school, you are entering a troubled industry that right now is on a downward trajectory. You are in the wrong profession, to put it another way. Most of you are going to suffer and suffer greatly for being in the wrong profession.

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  2. "Indiana wants me!"

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    Replies
    1. Lord, I can't go back there.

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  3. The Technological Singularity is almost upon us. There is no hope.

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  4. BigLaw and MidLaw have been using young lawyers as bottoms for YEARS, and dumping them as soon as the work flow slows down. It's a revolving door.

    Firms used to be able to perform this ritual with far less (if any) public scrutiny, and then able to portray it as cleaning house of defective, nonperforming associates. The fault was wholly the associate's. Today's news, while extreme, is nothing new. Call it the Cravath model, "up or out", or "eat what you kill", it's standard fare in the profession.


    THIS is the scam.

    The vast, vast majority of the rare jobs in the legal 'profession' are 3-4 year stints, at best. The fact that law schools vomit forth plenty of new cannon fodder each year enabled this procedure to flourish. Each year witnessed something similar to this, though not perhaps on this scale.

    Folks, lose the focused hatred of Law School and focus on the vile Law Profession that it's long served. Law school developed to serve that market and economic model. The overproduction of lawyers is only now just getting press because the revolving door is literally stuck. Today, it's 'Up or Out ... with no possibility of Up.' The heartbreak and destruction and waste referenced in the OP have been ongoing for decades.

    Thank God for these Blogs. At least today, the truth can began to be voiced. No, this ain't just the Obama economy or a 2008 recession phenomenon. It's been happening for years.

    2008 brought it to a head and you're just now seeing it discussed in public. Thank God for these blogs.


    The profession was on a "downward trajectory" in 2001. Today it's in freefall. Getting today's young lawyers counseling is pointless. They committed suicide years ago.

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    Replies
    1. "No, this ain't just the Obama economy or a 2008 recession phenomenon. It's been happening for years."

      Clearly, you're not a Most Excellent Professor of Law who can understand nuance and statistics and just blame it on the recession/cyclic economy like I've seen at Prawfs or TFL.

      Keep in mind that the 3-year-spitout worked out fine for most academics and you can probably see why they gloss over the long-term problems.

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    2. "Law school developed to serve that market and economic model. The overproduction of lawyers is only now just getting press because the revolving door is literally stuck."

      No, it didn't. Law schools have evolved in response to changing theories among elite law professors and lawyers. They came to believe two things, since the 60s-70s:

      1) that America had too few lawyers -- too many people couldn't afford their services. The way to solve this was to massively increase the number of lawyers.

      2) That America had too few lawsuits. This conceived of lawsuits as beneficial social problem-solving. Eg, America's personal injury lawsuits served the function that was filled in Western Europe by welfare systems and unions. The US needed more. More lawsuits = more social problem-solving = better country. Therefore more lawyers are needed.

      (You can trace the development of these ideas in law review articles going back decades. I don't remember the references unfortunately.)

      I know for a fact these ideas developed. I am highly suspicious they influenced the ABA's accreditation spree and increasing admissions among existing schools. Someone should write an article tracing more clearly the development of these hare-brained ideas and their impact on the ABA and function of law schools.

      --Jim

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  5. writing was on the wall when this article came out a few years ago.
    http://www.theatlantic.com/business/archive/2012/04/the-death-spiral-of-americas-big-law-firms/256124/

    the money quote
    "During the early and mid aughts, firms built unsustainable business models that survived off the froth flying from Wall Street. Now, many have become too bloated to change course and adapt to a new era in business."

    ReplyDelete