WisBar News: New Report Highlights Struggles for New Lawyers, Recommends Ways to Ease Financial Burdens:

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  • WisBar News
    December
    06
    2013

    New Report Highlights Struggles for New Lawyers, Recommends Ways to Ease Financial Burdens

    Joe Forward
    Legal Writer

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    Dec. 6, 2013 – Reduced-cost CLEs, a dues break, and a State Bar-sponsored law firm staffed by new lawyers – these are just a few ideas floated by a task force created to develop strategies that could help new lawyers overcome significant challenges.

    The Challenges Facing New Lawyers Task Force (task force) – composed of 10 lawyers appointed by then-State Bar of Wisconsin President Jim Brennan in 2012 – has released a full report with statistical, anecdotal, and other sourced information that describes the struggles for new lawyers.

    Task force co-chair Arthur Harrington will present the report’s findings and recommendations to the State Bar’s 52-member Board of Governors today. Ultimately, the board will decide what steps, if any, should be taken to address the issues.

    So what are the biggest challenges? Student debt, job scarcity, and low earnings are the big ones. Many law students are graduating with an average of $90,000 in student loan debt, while many are also earning less than expected, if they find legal work at all.

    “Anecdotally, we all know that new lawyers are having difficulty coming out of law school with student debt and finding jobs, or finding jobs that pay enough to service the debt,” said board chair Sherry Coley, also a task force co-chair. “But I don’t think we really knew the extent of the problem. That was the biggest surprise for me.”

    The Struggles

    For more than a year, the task force gathered information on new lawyers and what they face after graduation, hoping to develop short-term and long-term solutions.

    The task force held listening sessions at the law schools, consulted numerous reports and articles, and conducted a survey of Young Lawyers Division (YLD) members. It also solicited input and information directly from other State Bar members and groups.

    What the task force found is a swath of new Wisconsin lawyers who are struggling to make ends meet. Many go months without finding a job. Others take jobs that don’t require a law degree, or at salaries that are too low to meet monthly debt payments.

    Sherry Coley

    Sherry Coley, co-chair of the Challenges Facing New Lawyers Task Force.

    Unlike medical school students who also graduate with high debt, lawyers currently don’t have the employment opportunities and earning potential that doctors enjoy.

    “Everyone knows medical school students graduate with high debt, but their income and employment potential far outstrip the situation with lawyers right now,” Coley said. “Eventually, doctors will make a high wage, and find jobs through residency programs."

    The typical entry-level salary for associates in private practice at a firm with 6-25 lawyers is $50,000, according to the State Bar’s 2013 Economics of Law Practice in Wisconsin Survey Report. This entry-level salary is on par with starting salaries for prosecutors and public defenders. New lawyers at smaller firms typically earn less.

    About 80 percent of the 599 new lawyers who responded to a task force survey earn about $42,000, and indicated that they work in firms with less than 20 lawyers.

    Some new lawyers say these salaries cannot support the debt payments they are required to make under normal 10-year repayment plans. There are loan forgiveness programs for lawyers working in public interest jobs, but those jobs are limited.

    There are also student loan repayment programs that help borrowers reduce monthly payments to a small percentage of income. But if incomes are low and the debt high, monthly payments may not cover the monthly interest, causing the debt to balloon.

    Some say these lawyers are at fault for attending law school. But Coley points out that many were already enrolled when the 2008 economic crash occurred. She also says that many lawyers don’t go to law school for the money. They go to help people.

    “People didn’t know how bad the problem was until they were already in law school or had graduated from law school,” Coley said. “Many others choose law school as a calling to help people and serve justice, and the legal profession needs them.”

    Short-term Recommendations

    To help new lawyers who are struggling financially, the task force made several short-term recommendations. But larger, systemic changes to help new lawyers will require collaboration from multiple entities and organizations, the task force notes.

    The task force recommends that the State Bar of Wisconsin offer reduced-rate CLEs to new lawyers, to the extent it has the budgetary means to do so. It also encourages local bar associations to develop low-cost, in-person luncheon CLE programs.

    “We think of this new generation of lawyers as high-tech and technologically savvy, but these new lawyers also want traditional in-person access to experienced lawyers,” Coley said. “We should create affordable networking and learning opportunities.”

    To give lawyers more access to experienced lawyers, the task force also recommends developing a mentorship program, allowing mentors to obtain CLE credit.

    Arthur Harrington

    Arthur Harrington, co-chair of the Challenges Facing New Lawyers Task Force.

    In some states, such as South Carolina, every new lawyer must complete one year of mentoring, and mentors get CLE credit. Assuming the board approved a new mentorship program, the Wisconsin Board of Bar Examiners (BBE) oversees CLE requirements, meaning any program granting CLE credit needs BBE approval also.

    Ensuring that law students understand the importance of practical skills courses offered at law schools requires increased communications with students, the task force says. It also recommends publicizing and promoting the results of surveys and reports that can help potential law students decide whether law school is the right path.

    The State Bar should support more practice management and business training opportunities, the task force explains, while noting the State Bar is exploring new programs along these lines and forging partnerships with outside groups to help.

    Coley noted that the State Bar’s Board of Governors already approved a dues structure change for new lawyers, cutting mandatory dues in half for five years instead of three. The Wisconsin Supreme Court must approve the proposal, which it has not yet done. However, the supreme court is scheduled to consider it in January 2014.

    Recommendations

    In the long-run, helping new lawyers “may entail shifting certain paradigms,” the report states, and the task force recommends that the State Bar commit to this effort. The task force also notes several large-scale initiatives for leadership to consider.

    One recommendation is a State Bar-sponsored law firm providing short-term apprenticeship work for recent graduates, perhaps providing legal assistance to the poor or underserved. Other large-scale initiatives include:

    • a small business incubator to help potential solo practitioners;

    • a program to help lawyers find work in rural areas;

    • a “legal residency” program that would give lawyers on-the-job training;

    • a program to help lawyers obtain temporary and project work;

    • a court clerk program, funded by law schools, where law students work as clerks in the court system to provide assistance amidst shrinking budgets;

    • reduced-rate assistance with financial and retirement planning;

    These large-scale initiatives, the task force notes, would require collaboration between the State Bar, the law schools, the BBE, the Wisconsin Supreme Court, the ABA, and other entities. Fixing systemic problems in the legal profession could take years.

    Thus, the task force “recommends that a permanent committee of the State Bar composed of particularly qualifying individuals should be established to assist in the future the efforts to lessen the challenges facing young lawyers.”

    “I think it’s going to take a range of solutions from a lot of different segments,” Coley said. “Hopefully the State Bar is in a position to drive that collaboration.”




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