Our legal education system is in deep trouble. According to a January article in The New York Times, nationally, applications to law schools have hit a 30-year low, due to the higher tuition and debt facing law students and because of shrinking employment opportunities. And The Wall Street Journal reported in July that law school applications have fallen by 36 percent over the last three years alone. Texas law schools are faring slightly better than the national trend but confront the same long-term challenges. [See Applicants Down, Tuition Up at Most Texas Law Schools, Texas Lawyer, Sept. 2, 2012, page 1.]

Faced with a shrinking applicant pool, law schools face a dilemma. If a school chooses to maintain the size of its entering class in order to maintain revenues, the quality of its entering classes will necessarily decline. This will eventually result in lower bar results, will dissuade employers from hiring the law school's graduates, and in turn, will make it more difficult for the law school to attract good applicants. On the other hand, if the law school chooses to reduce class size in order to maintain academic quality, it will be required to charge an increasing amount of tuition to make up for money which would have been paid by the missing students. The higher tuition then serves as a deterrent to enrollment in the school, requiring additional tuition increases.??

What should law schools be doing to address this continuing crisis? First they are going to have to demonstrate to potential applicants that the investment in a legal education (up to $150,000 per the U.S. News and World Report website) will pay off. That means the most important focus will be on helping their students finds jobs. Law schools cannot directly affect the marketplace, but they can help make their students more marketable. Texas Lawyer has pointed out the innovative steps being taken by some Texas law schools to place graduates in traditional law practices, and the other schools should emulate them. Texas lawyers can assist in these efforts by recruiting students from their alma maters. Beyond this, however, schools are going to have to become more innovative and aggressive in placing law graduates in careers other than traditional law practice. Individuals with law degrees have been very successful in business, government, broadcasting, the arts, education and many other areas. Law schools will need to actively seek such positions for their students, and counsel students as to these possibilities.

Next, law schools are going to have to reduce the cost of legal education. Faculty salaries are the biggest item in law school budgets. Most law faculty members hold tenure or are on the tenure track because current accreditation rules of the American Bar Association (ABA) require it. It is very difficult to fire tenured faculty members. The ABA is currently considering changes to these rules that would allow schools to avoid granting tenure to law professors. While trying to strip existing faculty members of tenure or tenure-track status in order to reduce the budget would create legal and ethical problems, schools could seriously consider limiting the grant of tenure to new hires, in order to maintain the flexibility to down-size should the need arise.??

In light of the inability of schools to fire tenured professors, some observers, including law school deans, have called for an immediate reduction in faculty salaries. However, that approach would undoubtedly have a very negative impact on the morale and the academic environment in the law schools.??A better solution would be to maintain the salaries, but use a combination of voluntary attrition and voluntary early-retirement plans to reduce the law school budget. These plans would have to be genuinely voluntary, if a law school wishes to avoid age discrimination lawsuits.?? Law schools could replace the departing tenured faculty members with experienced attorneys and judges who could teach as adjunct professors in the schools.?? Salaries for adjuncts are much lower than for full-time faculty.

Law schools could also require that faculty members teach more.?? Most schools consider a full time teaching load to be six hours per semester.?? Faculty could be asked to teach seven hours at the same salary rate, to make up for departing colleagues. That alone would ultimately result in a cost saving in the law school salary budget of 17 percent. While that move won't be popular among some faculty members, it would be a much more attractive option than reducing salaries, laying off faculty members (even in a system of tenure, professors can be laid off in a financial exigency), or closing the school.

Other costs, including the salaries of deans and administrators, and the amount paid by a law school to the university with which it is affiliated, over and above its own operating costs, could be held down or even reduced, in order to reduce the rate of tuition increase.

Besides reducing budgets to alleviate tuition increases, law schools should also seek to increase external funding options. For example, schools could explore with local governments the possibility of contracting with the schools' clinical programs to provide indigent misdemeanor defense.

There are several things law schools must avoid. They must avoid the temptation into which some law schools have fallen, of falsifying placement data in order to attract students to the school. Besides the obvious legal and ethical reasons not to engage in this practice, the damage to the school's prestige and its ability to recruit good students will linger well beyond any forced correction of the erroneous data. Also, law schools should not admit a relatively large class in order to maintain the budget, take tuition dollars from students it does not believe will ultimately succeed, and then flunk out a large percentage of them in order to maintain the bar passing rate. At a minimum, a school which enforces a grading curve guaranteed to fail a predicted percentage of its entering class should publicly reveal that percentage before students enroll in the school.

In the third and final installment of this series, we will examine how the growing external challenges to our profession will affect legal education in Texas.