LAW SCHOOL: No longer “the path into the middle class that it once was.”
LAW SCHOOL: No longer “the path into the middle class that it once was.” (Diego M. Radzinschi / NLJ)

The number of applicants to American Bar Association-accredited law schools declined by about 8 percent this year, dashing hopes for a reversal in a four-year downward trend.

Applicants have fallen by more than 37 percent since 2010, according to figures from the Law School Admission Council, offering further proof that plenty of would-be lawyers now view a law degree as a risky investment.

“Law school just isn’t the path into the middle class that it once was,” said Alfred Brophy, a University of North Carolina School of Law professor who has tracked enrollment. “Things have tumbled downhill very rapidly. … Students are disappearing, and it’s unclear when they’re going to come back.”

The latest decline in applicants should translate into about 38,000 new law students next fall, Brophy estimates — a nearly 28 percent drop compared to the first-year class of 2010, which had a record 52,488 students.

There was some positive news amid the sobering numbers: The number of applicants with relatively high scores on the Law School Admission Test (LSAT) fell only slightly, and the 2014 admissions cycle represented the first time in three years that the year-over-year applicant decline landed in the single digits. Last year, the number of applicants fell by 12 percent; in 2012, the decrease was 14 percent. Still, this year’s numbers don’t suggest a recovery in the market for law degrees. “I think this is a real morale buster,” Brophy said. “A bunch of people had been thinking, ‘We’ve hit bottom and things will turn around.’ But we didn’t see that.”

Several developments had indicated a possible rebound in enrollment trends. Seton Hall University School of Law professor Michael Simkovic and Rutgers University business professor Frank McIntyre made news last summer with a study concluding that a law degree might be worth $1 million in career earnings compared to a bachelor’s degree. A number of law schools announced tuition cuts, large-scale scholarship programs or related initiatives intended to make a J.D. more affordable. And in February, LSAT takers edged up by 1 percent compared with 2013 — the first increase in 14 consecutive administrations.

But that represented just 213 additional people and probably reflected rescheduling by some test-takers due to bad weather during the December sitting, said Wendy Margolis, director of communications for the council. February was the first time the LSAT was offered in Spanish in Puerto Rico, which also helped boost the numbers.

“Frankly, there was never a very good theory as to why we would see a correction this year, nor did the data point in that direction,” said Daniel Rodriguez, dean of the Northwestern University School of Law and president of the Association of American Law Schools. “The optimism was a product of wishful thinking.” Many educators simply couldn’t fathom that the numbers would drop any lower, he said. Brophy, for example, long assumed that first-year enrollment would never fall beneath 35,000, given that a certain number of people will always want to be lawyers. Now he’s not so sure. Final 2014 enrollment figures won’t be available until fall, but Brophy’s 38,000 estimate — based on correlations between applicants and matriculants over the years — would be the smallest cohort of first-years since 1974, according to data from the ABA.

University of St. Thomas School of Law professor Jerome Organ also has been keeping close tabs on the application cycle and noted a interesting trend: The number of applicants with high LSAT scores — 165 and above — declined by fewer than 1 percent compared to the previous year. Those with scores between 145 and 164 declined by more than 9 percent, however.

NO GOOD OPTIONS

“For the schools in the top 30 or so, who tend to garner many of the people at 165 and above, there may be enough to go around without too many schools having to shrink enrollment too significantly,” he said. “But below that, the law schools with LSAT medians between 145 and 164 will be trying to maintain enrollment and profile with 10 percent fewer applicants to draw from.”

That means many schools will be forced to choose, yet again, between accepting smaller classes or students with inferior academic credentials. The first option hurts the school’s bottom line, while the second can send a law school tumbling down the influential U.S. News & World Report rankings.

The dearth of applicants means difficult decisions for deans. A number of law schools have already shed staff or tenured faculty, curtailed hiring or sought emergency funding from their central universities. Additional enrollment declines would mean even more transformative changes in the law school business model, Rodriguez said. “The market is screaming loud and clear that things have to change,” he said. “There is a collective-action problem — not one of us can make structural adjustments with the flip of a switch. Many schools are making adjustments, but whether they are transformative is in the eye of the beholder.”

Meanwhile, the 2015 admission cycle has already gotten off to a slow start. The number of people who took the LSAT in June — likely including a few stragglers hoping to start law school this fall but primarily people aiming to apply next year — fell by 9 percent compared to 2013. First-time test takers were down by 14 percent.

Organ was not terribly surprised by the weak June LSAT figures, given that the postgraduate employment numbers released by the ABA in March reflected a soft job market. The number of people who sit for the LSAT in October will be telling, he said. For the past four years, the number of matriculating students has been between 92 and 94 percent of the sum of June and October LSAT takers.

“June is discouraging, but I’ll be interested to see what happens in October and December,” Organ said. “If we’re going to avoid another application drop, the number of LSAT takers in October will have to be larger than the number of people June lost.”

Contact Karen Sloan at ksloan@alm.com.