Australian Legal Education – Excess Capacity? A Crisis in the Making?

By Colin Picker

Those that follow American legal education will be all too aware of the current over or excess capacity in U.S. legal education that has resulted from plummeting applications to U.S. law schools.  There are many reasons for the decline in U.S. law school applications, but perhaps the most widely discussed has been the slow down and transformation of the U.S. legal market.  The GFC and changes in how law firms operate have combined to reduce employment prospects for graduates of American law schools.  When deciding whether to invest three years and significant money in a law degree, many who would otherwise have gone to a U.S. law school have decided to pursue other options or to wait until times are better.  Most U.S. law schools have faced problems maintaining standards as those application numbers have dropped.  Responses have been draconian (see here). One response has been to decrease entering class sizes.  Another has been to consider mergers between law schools.  Another may eventually be to shut down law schools. Even before that extreme step, it is now common to hear of hiring freezes, mass early retirements, and, in the most extreme cases, the elimination of positions and the firing of academic and other staff.

But what about Australia.  Do Australian law school and law academics and staff have anything to worry about? Perhaps (see here).  The raw numbers of Australian law schools and students suggest there may very well be cause for concern as is shown by the following simple “back-of-the envelope” guesstimates of Australian legal education in comparison to that of the stressed and ailing U.S. legal environment:

  • The population of America is about 314 million. There are about 200 ABA accredited law schools. Each law school has about 200 law graduates entering the legal job market each year.  Recent estimates have suggested about 45,000 law graduates a year. Per capita that is roughly 1 law grad per 7000 Americans.
  • Australia has a population of 23 million. There are at least 35 law schools (it may actually be slightly more and appears to be growing all the time).  Each school on average probably graduates at least 300 law graduates a year.  That is at least 10,500 law grads per year in Australia.  Assuming only half wish to enter the job market, then there are at least 5000 new entrants into the legal job market each year.  Per capita that is at least one law grad per 4400 Australians.

Those that know about Australian law schools will realize that I may have undercounted the number of law grads entering the legal job market, perhaps by a factor of 2. The undercounting may result from the fact that:

  •  300 LLBs per year per Australian school may be too few;
  • A recent survey suggests that the assumption of only 50% of graduates of Australian law programs wanting to practice law may underestimate the real and higher number; and
  • There are an increasing number of graduates of postgraduate law studies (grad LLB and JDs), a greater percentage of whom may wish to enter the legal job market given their average higher tuition indebtedness, professional ambitions and age.

So, viewed most optimistically, Australia is turning out significantly more law grads per capita into the Australian job market than is the case for America!

Of course, there are some substantially different contexts in Australia, including:

  •  Australian law schools may have higher percentages of international students than is the case in American law schools – many of the overseas students that studied in Australia, if not most, will not enter the Australian legal job market;
  • The bulk of the Australian law grads are younger and perhaps less set on law as their career, and hence have the time and resources to re-tool;
  • Unlike the American legal environment, the Australian legal market and the overall Australian economy has been, at least until recently, relatively immune from the GFC; and
  • Most critically, Australian law student debt is in most cases significantly less than that for U.S. law graduates (this issue is perhaps the central point in the current debate about the future of US legal education).

Nonetheless, despite those differences, the Australian numbers are worrisome – especially over the long term.  It is hard to believe that the Australian legal market has greater capacity to absorb so many law graduates than does the supposedly more litigious American legal market.  It should be noted, however, that in America the issue seems to have been most problematic for less prestigious law schools, newer law schools and those located outside the primary legal markets. Graduates of the elite schools have generally fared much better in their job searches and often have much lower debt burdens due to the generous financial aid that is often provided by the well-endowed elite law schools.

Nonetheless, given the above numbers, it seems that at a minimum a conversation on legal education capacity in Australia seems in order, especially in light of the steadily increasing numbers of Australian law schools and the pressures that university administrators may be putting on law schools to constantly increase the number of students they will accept.

Advertisements

4 thoughts on “Australian Legal Education – Excess Capacity? A Crisis in the Making?

  1. Carolyn Penfold says:

    You say the main benefit of grad entry to law is “that it would increase the proportion of students that want to actually practice law.” But is that a good thing? Surely it would not be good if all the people with an understanding and appreciation of law and legal systems were practitioners? Knowledge of law is like knowledge of government or knowledge of society or knowledge of politics or knowledge of history; it helps to understand society. for that reason I’d say no to any move to ‘grad-only’ law.

    Like

  2. I think there is an oversupply. Law degrees are replacing “Mc” Commerce and “”Mc” Arts degress as the new generalist degree. Personally, I think law should be graduate entry only. The main benefit I see is that it would increase the proportion of students that want to actually practice law.

    Like

  3. Cathy Sherry says:

    Very interesting post Colin. I wonder if there might be an additional ‘moral hazard’ in Australia because students are never going to be in the position of having to pay debt when they have no or limited income. HECS only kicks in once people are earning over $50,000. I am not suggesting that we change our HECS system – I think it is pretty fair – but students do not have to engage quite so seriously with the question of whether they will be able to pay back their debt, in the way students do in the US.

    Like

Leave a comment on this post

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s