How well are law graduates doing?

Commenter Gluggy is presenting a very negative view of employment outcomes of law graduates. I don’t have unemployment figures (though given low overall graduate unemployment it is hard to imagine law graduates are an exception), but I do have some 2006 census data. I’ll look at male graduates, as they are more career-oriented.

Occupations of male law graduates 2006

image002

Among male law graduates, by their late twenties a majority have legal jobs. The figure for those aged 20-24 is artificially low, as another 14% had jobs in the ABS category that includes articled clerks. Except in that youngest group, they equal or exceed the overall average percentage of graduates in managerial or professional jobs of around 75%.*

Income of male law graduates 2006
Income image002

Income results are also positive. With this graph I had a comparison with graduates in general, and as you can see a weekly income income emerges in their late twenties and is wide through their careers. Indeed, this graph understates how large the gap is, as most ticked the highest census category of earnings of $2,000 a week or more.

I don’t doubt that Gruggy can name individuals whose law degrees haven’t done them much good. But this isn’t the typical picture, and the interest of students in studying law seems justified overall.

*Having cross-checked against the original data source, this includes 11% who are not in the labour force. Among those actually with jobs, by the late 20s 59% had legal jobs, rising to 2 out of 3 aged 45-64, and 80-90% depending on age group have managerial and professional jobs. These are well above average outcomes.

51 thoughts on “How well are law graduates doing?

  1. Andrew – what is your first graph showing? People with law degrees working in legal jobs against people with other degrees working in the area of their degree?

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  2. Sinc – The occupations of all people who in the 2006 census gave law as the major field of study in their highest qualification. It’s not a perfect measure as people with LLBs but postgraduate qualifications in other fields would not show as law graduates. Unlike the second graph, there are no comparison points with graduates in other fields. The bottom line is LLB graduates working as other kinds of professionals or managers.

    Rationalist – I had a lot of trouble analysing engineers because their occupations are typically quite varied, with never a majority in a single occupation whatever the engineering category. As I don’t have an engineering background I could not easily tell whether these jobs would draw on engineering skills or not, and needed to go back to the ABS occupational descriptions, which I never got around to doing.

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  3. You are showing statistics that law graduates do better than compared to the average population. But to do a proper comparison you need to compare like with like – see what the same type of person would have done with or without a degree.

    To get into law I had to finish in the top 1% of the state – I did so. But when I graduated, there was no job for me for two years, then when I did start it was on what would be now the minimum wage. It took me 5 years to earn the median wage.

    I then went back to uni, studied IT and got into that field.

    So in other words, law schools take a highly competitive bunch of people, destroy their job prospects, but then many of them manage to escape this by doing other degrees or retraining. And this is what pushes up the figure.

    To put it in simple terms the higher graph here is IN SPITE OF the law degree the people have been lumped with (and most have probably removed it from their resumes).

    Law school is an open scam.

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  4. Gluggy- We don’t have any data on school performance (though the pool would be much larger than the top 1%, there are many law schools that enrol on less, and backdoor entry to the law schools that do require that for school leavers). But the data does show that much higher proportions than anecdotal evidence suggests are in fact pursuing legal careers, and the remainder better than average career outcomes. Given most law students do double degrees in the first place it is not suprising that they have other options.

    Law school isn’t a guarantee of good outcomes, but the existence of outliers such as yourself doesn’t mean it is a poor choice, given that every course choice has risks.

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  5. “So in other words, law schools take a highly competitive bunch of people, destroy their job prospects, but then many of them manage to escape this by doing other degrees or retraining”
    .
    Actually, you can frame that in reverse, which is that highly competitive people go to law schools. Why blame law schools for taking people who willing to go? Should people have their chance of doing legal stuff stopped because lots of other people want to also? It seems this situation is far better than, say, medical schools, where supply is massively restricted so many people never get the chance (some of whom would no doubt be better than many that did the get the chance).
    .
    Incidentally, the unemployment rate for new graduates for those with IT degrees is higher than law. I think some new graduates are just unlucky with jobs (quite possibly you), and others have personality characteristics that make it harder for them (e.g., high levels of introversion, anxiety etc.).

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  6. Isn’t it the case that there are now as many law students in Australia as there are lawyers? If so, it’s no wonder some law graduates have a tough time of it when they graduate.

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  7. While of course it’s true that not all law graduates get good jobs and many would do well anyway without a law degree, I think a law degree offers quite a few options. Apart from becoming a barrister or partner in a law firm (which is probably only feasible for the top one-third of graduates who are willing to flog themselves), an LLB offers reasonable prospects of a good income with relatively low risk and stress. In my perhaps highly limited experience, if you want to earn more than about $100-150K (which is, let’s face it, how much you need to earn to buy a house in a nice area these days) outside a profession, you need to either work in the finance industry, manage people or own a business. If you don’t want to do any of these things and are interested in working with abstract concepts, law is not a bad option. There are plenty of women in particular who leave large law firms after a few years and earn a good living working as a corporate lawyer with minimal management responsibilities, reasonable hours and $150K+ salaries. They would most likely earn one-third less working as policy officers in the public sector.

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  8. Andrew I consider the negative theory about law study effectively debunked.

    What I see is that by their late 20s, more than 3 quarters of law grads have law or other good jobs.

    Early 20s who have actually graduated is likely to be a relatively small pool. As you say a decent fraction of them are probably doing articles.

    We can question the value to society of all these lawyers, but thats a different topic…

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  9. Conrad is right about IT. Gluggy is lucky to have found work, since this has been one of the worst labour markets in recent times. In the paper I did for NCVER earlier in the year, I found that in the first half of this decade growth in the number of graduates (many from migration) was about 107,000, compared to a net increase in jobs of about 25,000.

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  10. To clear up a couple of things:

    – For my university at that time (started in 1989) had to finish in top 1%, and you still do to get in.

    – As Andrew says we just aren’t compariing like with like. My contention is that law school in particular takes people who are highly employable, sets them back considerably with a useless degree, then many of them manage to rebuild their lives, as I did.

    – There is also comment about why people would do this, why they would voluntarily reduce their career prospects. I think firstly, most students WANT to believe university will help them.

    – Secondly, we’re not considering the sheer vast amount of advertising PR put out by the universities and law schools in particular. Have a look at the Graduate Careers Council, the massive print advertising by the university sector, the endless popup ads on popular websites. The marketing budget is enormous and a lot of that is skewed towards law degrees.

    – Or just look at the incredible run Bob Birrell gets in the media every time he says ‘university is worth it’.

    – I know this first hand from a few months ago when I gatecrashed a law degree recruitment night with a leaflet with facts about the law school disaster. The sheer amount of glossy leaflets the law school lemmings had was is incredible.

    – So I stick to my guns. Law school takes highly employable people, destroys their chances, but they manage to fight back with the other skills they have got. And the same is true for most university study (apart from engineeriing and esp medicine, dentistry which are licenses to print money).

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  11. Surely it depends on which law school they attended. Getting a degree from the University of Melbourne, and joining the commercial bar after a few years at a top firm is one thing. Getting a degree from a bad university and then practising personal injury and family law at a suburban practice is very different.

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  12. I went to the University of Melbourne !

    You can’t just choose where you go. I got one interview when I graduated in the early 90s. The big firms only give jobs to about 5% of the class. You dont get an interview, so you dont get a job, so you end up in suburban practice, where there is no money.

    Utterly useless.

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  13. Ah, now things are becoming clearer. Gluggy entered the worst graduate labour market ever, where the initial boost in graduates from the Dawkins expansion looked for work during a serious recession. It was especially bad in Victoria. Still, law did better than the others – in 1993 the proportion of law graduates in FT employment was down 5%, compared to 17% overall on the 1990 boom.

    While graduating into a recession can cause years of problems, the long-term data suggests that recession graduates eventually get similar outcomes to the age cohorts around them.

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  14. In fact you really have to question the morality of the people who work in the higher education sector (both teachers and administrators).

    They know full well that it is a scam, and that their students will never get jobs, and yet they continue to work in and promote it. I really think these people have to have a good hard look at themselves.

    A big bust is coming, the sheer rage of the unemployed graduates is growing at the higher education rort.

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  15. Gluggy – I think there should be more detailed information easily available about graduate outcomes (though short-term labour market outcomes by course are easily available.). But very few graduates are unemployed and the vast majority are in professional or managerial occupations. For high-achieving students (say top 20% of cohort) I would recommend going to university. It’s no guarantee of success, but it will substantially improve their chances of career success.

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  16. Andrew, I dont quite follow your post above.

    When you say
    in 1993 the proportion of law graduates in FT employment was down 5%, compared to 17% overall on the 1990 boom.

    what does this mean ?

    You say there was a 5% decline in percentage of graduates in FT employment but then you compare it to 17% – I dont follow.

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  17. Gluggy,
    .
    I think you need to calm down. Given you got 99% for VCE, surely you were smart enough to think about what course to do before you did it? Perhaps that’s the best recommendation (one sadly not done by many students — suprisingly including postgraduates, who often choose awful supervisors despite a Scopus search only taking a few seconds). It’s also worthwhile noting that those that do law probably arn’t doing the type of law they want anyway. I’ll bet at least 2/3rds of first years think of law as the type of law they see on TV (versus the reality of reading through big boring documents which is what I assume most of it is).
    .
    At present universities simply supply demand from students (that’s pretty much the government’s mandate to them). The only solution to restricting overall supply in various professions is therefore for the government to restrict places across universities in very particular areas, which no doubt they would bodge up completely, so it’s hardly better than allowing students to do what they want.

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  18. Well, I stick to my guns. Higher education in the main is a scam.

    We need proper ‘re-run the video’ data. Ie – if this exact same person with the skills etc, decided not to go to University what would they end up making ?

    The results of this would then clearly show that their earnings would have been higher than if they had never gone to university.

    At the moment we are comparing two different cohorts of people – people who wouldn’t get in anyway versus people who did make it. So the latter group show higher earnings, which they have anyway based on their attributes.

    The comments on this board show that the ‘unversity myth’ die hard. I think there are a number of reasons. Its comforting to think you can better yourself, even though its a lie. Its comforting to the people who work at Universities, that their employment is a positive thing, when in fact it perpetuates great destruction of human potential. Its comforting because it covers up the fact that really life is a struggle, getting worse every day, and there’s not enough to go round.

    More and more people are talking and thinking my way.

    University and higher education is a scam.

    And I really do think the people that work at universities need to question their own morality – some commentators have suggested they are amoral animals for perpetuating the scam.

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  19. Gluggy – Or maybe they just look at the data. True, there are no studies of high school achievers who did not go to university. That leaves your hypothesis as a possibility, but one which has no empirical evidence to support it. Whether it is a good thing or not, many of the most desirable occupations are now difficult or impossible to enter without university qualifications.

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  20. Hurtle – Sorry, it was not very clear.

    In 1990, 96.8% of law graduates seeking FT work had it. This dropped to 91.6% in 1993.

    In 1990, 87.8% of all graduates seeking FT work had it. This dropped to 71.1% in 1993.

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  21. I know someone who got a university medal in law from a top university and whose career has been an abject failure, due to personality defects. These things happen.

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  22. Friend of mine graduated in economics and law from ANU in the early nineties. Great student, plenty of co-curricula experience, including election to the student council, lots of friends and a genuinely pleasant personality.

    No jobs. Ended up going to the tax office.

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  23. Gluggy it is very important to differentiate between the knowledge gained at university and the skills. Most of the specific knowledge I have (especially from my PhD) I never use. However lots of the skills I gained get used constantly.

    I’m not sure if your argument is that the time spent at university was effectively dead time and they should have got a job at 18, earnt for the extra 3-4 years and have practical experience OR if you suggest that there’s actual damage done to them. Be it neurological, social, emotional or academic.

    Or is your issue with the abundance of Law Faculties which churn out heaps of grads (Law being highly profitable compared to many other disciplines due to low running costs and high prestige factor). All of my Law grad friends seem ok, although they do get plenty of heckling at BBQs.

    Success in a highly competitive field does rely on being able to play the graduate job game successfully. Some people are much better equiped for this than others.

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  24. This is gluggy – other response got stuck somewhere. I have to reply to the comment made by Rajat Sood on law graduate prospects. It shows many of the ‘Pollyanna’ attitudes which are leading so many law graduates into disaster.
    .

    Law students will begin sending out application in their last couple of years.
    .

    About 10% of Melbourne/Monash/Sydney/Sandstone uni graduates and maybe 5% of the other universitys will get jobs at BigLaw firms – I will call these students the ‘A Stream’. Everyone else is the B Stream.
    .

    The A Stream will have lucrative careers in BigLaw, and can also branch out into government and big consulting work etc. They have the chance of going overseas to use their law degrees. They can also become legal academics. I am also told (I know a few people in the A stream) that the burnout rate is high.
    .

    The B Stream will struggle to get articles, if they are lucky they might work at a local firm, for low pay (20k for articles if they are lucky, starting salaires then at about 30k). ‘MidLaw’ does not exist, its either profitable BigLaw or a useless scrabble for everone else. Legal unemployment rates in the B stream will be incredibly high – most wont get jobs as lawyers, and most will be considered unemployable for any other career type job (unless they do what a lot do now and remove the law degree from their resumes).
    .

    The B Stream will never, ever be able to leave the B Stream. No training they do will be recognized, no achievements or cases they win will be noticed. The sole criteria ever applied to them will be whether they have worked in BigLaw, the answer is no, and the jobs wont be there. There is no point ever doing another degree (wont be considered) or doing specialization
    .

    In fact local law institutes brought in specialization some years ago. After an initial rush of B Stream applicants deluded that it would improve their chances they discovered that it actually removed value – recruiters weren’t interested because they hadn’t worked in BigLaw and clients just thought they had to pay more and avoided them. Sad but true. I know many people who passed their specialization but have removed it from their marketing for this reason.
    .

    So there it is. Law is ok for the 5-10% who make it to BigLaw, it is a living disaster for everyone else. And students need to know the truth.

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  25. Gluggy,
    .
    if you want jobs where everyone gets the same pay, try nursing, teaching, etc. (or engineering or medicine, where the lower rungs are well paid as Rationalist implies) or move to a socialist country. Some professions are high risk and obviously you gravitate towards them (IT being another with massively variable pay). If you don’t like this, do something else (and make sure you avoid business and finance).

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  26. ‘The B Stream will never, ever be able to leave the B Stream. No training they do will be recognized, no achievements or cases they win will be noticed.’

    Gluggy, that’s complete bull****.

    My sister worked while studying for a Diploma of Law at nights. After many years of study, on graduation she found a job in the ‘B Stream’. Her work was so good, and her work ethic so strong, that the partners from ‘BigLaw who worked with her in her cases noticed her, and invited her into the ‘A Stream’.

    Living proof.

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  27. According to a source from 2007 , ‘Big Law’ (AAR, Blakes, Clutz, Corrs, DLAPF, Freehills, Mallesons and Minters) in Melbourne were looking to hire about 240 articled clerks. Then you have plenty of well-known mid-sized firms like ABL, Deacons, Hall&Wilcox, Hunt&Hunt, Middletons, Maddocks, etc, who planned to hire another 90 or so. Then you have AGS, the ACCC and other government legal employers as well as the accounting firms. I’m not sure how many law graduates are produced in Victoria each year, but it used to be about 500 from Melbourne and Monash in the 90s. Assuming it’s now about 900, there looks to be ‘Big Law’ jobs for at least one-third and more if you include government employers and accounting firms. And many graduates will not even be looking for these sorts of jobs, preferring academia, other industries or community and non-profit work.

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  28. After I graduated from Adelaide University Law and qualified in South Australia, I worked for a prominent, but local Adelaide law firm for a year, enforcing residential mortgages and other banking/insolvency-related litigation for amounts up to $1m. Adelaide doesn’t really have much ‘Big Law’, so to speak. Then I got a job in London in the Magic Circle and now I work on transactions in the billions. Its not that uncommon to move up in the legal world.

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  29. Further, the group I work in has eleven partners and four of them are Australian. One of them is head of the banking department; he did B.Com/LLB at UNSW. Another is managing partner of our group; he did the same degrees. The other two did B.Ec/LLB at the University of Tasmania and BA/LLB at Macquarie University.

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  30. Incidentally, the unemployment rate for new graduates for those with IT degrees is higher than law.

    Conrad, I think you are ignoring the fact that entry requirements for IT are extremely low compared to law. That is, the calibre of people who choose to study IT is much lower, as Gluggy says.

    When I went through TEE in WA, the entry requirement for law was 440/510, for IT it was 310/510. I’m not sure how much it has changed in 15 years but I’m guessing not enough to reverse that.

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  31. Gluggy – Or maybe they just look at the data. True, there are no studies of high school achievers who did not go to university.

    I’m willing to be a test case – school dux, uni dropout! Now I play poker for a living. And I know a lot of people just like me 🙂

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  32. Have been away but have to respond to a few points.

    James: good for you. What I find is that a lot of people who could make it to A stream (ie have good marks at Uni) often park themselves in the B stream.
    Sometimes this is because the market at that particular time is bad, and the A streamers get parked in the B stream. It is only temporary. This probably also explains Jeremey’s sister’s experience.
    Alternatively some consciously park themselves there. I can remember several very virtuous ‘A streamers’ loudly proclaiming their social conscience by working in welfare law, with the knowledge they could easily switch back to A stream employment any time they wanted.
    .
    What is immutable is that B stream candidates, who have ended up in the B stream not because of temporary factors and not because they wanted to, can never, ever move.
    .
    Rajat, I dont have the exact figures to hand of numbers of law graduates in Victoria, but be assured, it is absolutely enormous. The figures for BigLaw recruitment you quote are for 2007, I am very confident that they would be much lower than that. Ok Maybe 15% of Melbourne/Monash graduates get BigLaw, maybe 10% of the rest. It is still a human disaster of massive proportions.
    .
    The University myth dies hard. We need to remove all funding for higher education (except for engineering, medicine + dental).
    .
    This also means no loans scheme either – otherwise you’ll end up with the disastrous american experience of government backed loans which cant be discharged in bankruptcy.
    You end up with massive moral hazard – huge tuition rises – and websites like this one set up by furious exploited law students – the victims of predatory law schools and lenders: http://lawschoolscam.blogspot.com/

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  33. Gluggy,
    .
    it seems to me that your problem has nothing to do with universities, but your belief that you have special privileges versus everyone else because you happened to score well on a test when you were 17. Somehow life owes you something that it didn’t give you. If you can show me one university document (even from Harvard Business school) that says “doing this course will lead to a career that pays tens times the average wage, guaranteed” then I’ll be impressed (that appears to be what you wanted to happen in your life). Until that happens, I’ll just assume (a) you arn’t as smart as you think you are, because you chose a course where many people succeeded where you didn’t; (b) you don’t understand statistics, because otherwise you would realize this; and (c) your lack of self judgment leads you to blame other people/things for your own failings.

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  34. Conrad, lets get back on topic.

    I’m not saying ‘hey I’m a failure its all the law degree’s falut’.
    .
    What I am saying is that although I’ve ended up being reasonably successful, this was in spite of my law degree- the law degree held me back for many years and most of my friends.

    My complaint is the way law school is marketed currently. I would argue that currently there is saturation advertising of universities in general and law schools in particular. And these advertisements clearly imply or promise success.

    Law degrees are particularly dangerous as they are effectively an overpriced arts degree, but which create an expectation of success that will not occur.

    I agree with Andrew’s point that we need better statistics for people to consider university. There is enormous PR material out there leading the cheer for law schools – graduate careers council, Bob Birrell etc, students urgently need to see the real story.

    I’ve also possibly been a bit provocative, but its all been in good fun!

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  35. Just two more comments:
    .
    There has to be a lot in the fact that many law graduates (definitely most of my friends) only get decent jobs AFTER removing any mention of a law degree from their resumes. In fact to me this is the ultimate proof of the destructive nature of a law degree.
    .
    Surely you can see the vast amount of PR and propaganda put out by the university lobby – endless advertising, huge newspaper spreads, graduate careers council, all pushing the meme that university is good for you. I think most impressionable young people really do have a view that university is always wonderful.
    The drastic decline in trade training has been a victim of this destructive thinking and I think governments have woken up to this by seeking to reinstitute tech schools.
    .

    Lets make the focus here a positive one – learning from the mistakes of the past and moving now to remove all funding from the higher education sector apart from engineering, medicine and dentistry. This crucial reform – a true education revolution – could drive a massive productivity surge that would put Australia at the top of world rankings.

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  36. “My complaint is the way law school is marketed currently. I would argue that currently there is saturation advertising of universities in general and law schools in particular”
    .
    Usually when I commit three years of my life to something, I at least look into it beforehand. Given universities are to a large extent businesses these days trying to provide services to students (much more so than when you did your degree), you can hardly blame them for marketing their products. It seems to me that this argument is on about the level of the one where people complain about junk food making them fat.

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  37. “The drastic decline in trade training has been a victim of this destructive thinking and I think governments have woken up to this by seeking to reinstitute tech schools”
    .
    If you look at job growth, you’ll find most expansion is in areas where people need degrees, so you’re ignorant on that too. I personally went to a technical school, and it was rubbish — it didn’t do any good for anyone as I remember. Jeff Kennett (?) did everyone a favor by closing them all down.

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  38. I flipped through the comments, and I really think there is a cause and effect issue here. The data is great but i don’t think it supports a causative mechanism. Does law lead to high pay or do the smart and driven get into law, leading to higher pay?

    What’s more, is the oversaturation of ‘smart’ people in the legal field a negative, since driven people might find it easier to rise to the top quicker in other professions?

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  39. Why pay is high in law is an interesting question. Historically, we might have speculated that the limited flow of graduates from a small number of law schools helped keep salaries up. But the proliferation of law schools has seemingly generated little downward pressure on salaries. An alternative theory then is that the cases and transactions lawyers work on are often very high stakes for the people involved, and they are therefore willing to pay high sums to ensure a favourable outcome. People with high intelligence are more likely to secure those outcomes.

    I think particularly for people who are bright but don’t have strong quantitative skills law is a relatively low risk way of getting a well-paid job. Apart from the public service and academia, there is no obvious other major career path for such people. However, lawyers typically earn more than either and in academia there is a much higher risk of not securing permanent employment.

    I decided not to pursue a legal career in favour of work that I thought would be more interesting. While I have succeeded in getting a series of jobs I find interesting, I am also in early middle age with no clear career path and earning much less than friends who did pursue legal careers.

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  40. A picture is worth a thousand words. Here are the distributions of the starting salaries of US law graduates for the class of 1991, 1996, 2000, 2006 and 2007, 2008.

    Gluggy – Something can be socially wasteful but not individually wasteful. There probably is little social benefit to mass higher education, and that it may even be negative. Bryan Caplan said it best: “Going to college is a lot like standing up at a concert to see better. Selfishly speaking, it works, but from a social point of view, we shouldn’t encourage it.”

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  41. Conrad – I agree, graduates need unbiased information regarding their real prospects after graduation, however, when you have organizations like the ‘Graduate Careers Council’ putting out the stuff they do, it makes it very difficult to get the full picture. I am all for neutral hard data for graduates
    .

    Andrew asks why do lawyers make so much? Firstly, there are two legal professions, A stream, who’s clients are public companies and large govt departments, and B stream who’s clients are the general public. Firstly, B streamers make very little.
    A-stream law firms make a fortune because of mainly market failure, public companies and government departments are notorious big spenders on legal services; which are very difficult to value in any event. This is also why there is such a pathological focus in BigLaw employment on candidate background, as its hard to verify legal performance so there is endless focus on credentialism. Thats why in an interview for a BigLaw job you will almost never be asked a substantive question, rather, all questions will focus on who you worked with and who you worked for.

    The move to remove all funding from higher education is growing stronger by the hour – what was unthinkable is now becoming a very real, positive possibility.

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  42. Gluggy, you’re just talking absolute bollocks. In interviews for my firm, candidates are always asked at least some substantive questions. But if a candidate’s resume is up to scratch and their resume is corroborated by answering a couple of substantive questions & referees, its assumed they’ll cope with the work. The main focus of the interview then is ‘fit’. Candidates are never asked who they worked for and with (unless its by way of banter in relation to personal relationships), those details are either on their resume or covered by client confidentiality.

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