Aspiring young lawyers may want to read a new piece in the Wall Street Journal before sending in those law school applications. The Journal reports that, while the legal profession as a whole is beginning to see major price increases after the lean years of the recession, these higher fees are concentrated at the top of the profession. Top lawyers at top firms have managed to raise their prices by an average of 4.9 percent, while those at the bottom have scarcely been able to keep up with inflation:
“There are a large number of lawyers today who find themselves in the uncomfortable position of being, for lack of a better phrase, commodity service providers,” said Ken Grady, deputy general counsel at footwear company Wolverine World Wide Inc.[…]”You don’t see a lot of big rate increases being asked for in those areas, and that’s not something they expect to get.”
At the top, though, where clients have always been willing to pay top dollar for high-stakes litigation, mergers or other sophisticated legal work, the increase means more lawyers are joining the $1,000-an-hour club.This is good news for top lawyers, but it will have a serious impact on the profession as a whole. With the law profession segmenting into two tracks—one for high-charging superstars and a considerably more modest one for the rest—a law degree isn’t looking like a ticket to full employment at a high salary anymore. The vast majority of law school grads will find themselves facing the same lean and competitive marketplaces faced by their peers outside the legal profession. And the law students will be at a disadvantage: they will have considerably more debt to pay off than their non-JD counterparts.Where the rubber will meet the road will be at second tier schools and below. Currently, many of these schools have tuition costs that can only be justified by the prospects of high paying jobs for newly minted grads. The emerging two-tier structure of the profession — with a much smaller top tier — will eventually force all but a handful of schools either to cut fees or accept much smaller enrollments.Change is coming.