Dan Slater "argues that there are too many places at too many law schools":
As firms begin an industrywide overhaul, which has entailed slashing jobs and reconsidering hidebound inefficiencies like the lockstep salary, students will compete for half as many $160,000-a-year jobs this year as they did last. According to the National Association for Legal Career Professionals, the 2008 recruiting season marked “what is likely to be the beginning of a weaker legal employment market that may last for a number of years.”
Meanwhile, as job opportunities abate, law school matriculation rates rise unchecked. Each year, the number of students who enroll at one of 200 law schools approved by the American Bar Association inches closer to 50,000.
I wrote about this problem a while back, arguing that law was a mature business whose long term demand for new lawyers was likely to have stabilized at a level below that of the ever-increasing supply of lawyers.
The post-war expansion of the regulatory state, the opening of the courthouse doors to new claims during the warren Court era, and the litigation explosion provided an exogenous shock that caused demand for lawyers to rise rapidly. Following a fairly standard s-curve model, the demand for lawyers grew faster than the population and economic expansion would have predicted, driven by the aftermath of those shocks. Over the last couple of decades, however, the market for lawyers has adapted to those shocks. Because there have been no comparable major exogenous shocks affecting the demand for lawyers, the market has matured. We would therefore predict that growth in the demand for lawyers would slow until it reaches a level that can be sustained by population and economic growth. ...
If law in fact is a mature industry, we face a problem of systemic oversupply. The rate at which demand for new lawyers grows has permanently leveled off. Economic recovery will help, but it will not change the fundamental structural changes in the market for lawyers.
Unfortunately, the growth in the number of law schools and size of entering classes at many law schools was premised on the assumption that the demand for lawyers would continue to rise at the high rate characteristic of the period, say, 1960-1990. Because that growth rate was artificially high due to the exogenous shocks of the preceding decades, the number of law schools and large law school class sizes no longer make sense. Indeed, if law schools continue to grow in number and size at their current rate, the gap between demand for new lawyers and the number of new lawyers will continue to rise every year.
The solution is obvious, although how we can find the ability and the will to do it is not. We have to reduce the number of law schools. Just like GM has to close plants because of over-capacity, we in the law have to close some of our "factories."
The American Bar Association, which continues to approve law schools with impunity and with no end in sight, bears complicity in creating this mess. Yet a spokeswoman, citing antitrust concerns, says the A.B.A. takes no position on the optimal number of lawyers or law schools.
I guess we'll have to trust the market. Once word filters out to pre-law students about the state of the job market, maybe they'll start looking elsewhere. If admission applicants drop enough, maybe some of the bottom tier of schools will have to close for lack of qualified applicants. (Or maybe they'll just admit unqualified applicants.)
If we're overproducing lawyers, though, there's going to be a pernicious Say's Law effect, wherein the oversupply of lawyers begins creating its own demand (of lawsuits).
So everybody has an interest in finding a solution.