in Personal finance planning
It?s no secret that going to college can cost plenty, and there are no shortages of student loans, whether you?re looking for federal college loans, graduate loans, or private student loans.
Recently however, the American Bar Association has come under fire for the way it allows law colleges to report post-graduation employment rates. Some recent law college graduates charge that they?ve been fraudulently induced to spend tens or hundreds of thousands of dollars on law degrees that haven?t resulted in gainful employment as an attorney or even in any position that will allow these graduates to make the minimum payments on their law graduate loans.
Some graduates complain that they?ve amassed $200,000 or more in debt from student loans in pursuit of Juris Doctorate degrees, operating under the assumption that their alma mater?s post-graduation employment rates were sufficiently high to allow them to find work after graduation.
One law college statistic repeatedly being called into question is the nine-month employment rate. The ABA has always allowed law colleges to count any employment, whether or not it requires a law degree or is even relevant to the field of law, toward a school?s post-graduation employment percentage.
Under this type of accounting, law college graduates who, nine months after graduation, are making minimum hourly wage as servers at Chili?s or cashiers at Target are included in their law college?s percentage of ?employed? graduates.
Another problem? Reported starting salaries for newly graduated attorneys appear to be hyperinflated.
This alleged puffery shows up in surveys like the ones published by U.S. News & World Report, which compares law colleges around the country and ranks them according to tiers. The starting salary figures reported by the highest-ranked law schools like Yale and Harvard are repeated among law colleges in the second- and third-tiers of the survey, even if these figures don?t reflect the actual average starting salaries of the lower-tier schools? graduates.
Students comforted by those reported employment rates and starting salaries assume it?s worth the immediate debt load to take on both federal graduate loans and non-federal private student loans to cover the cost of law college ? debt that presumably will be paid back from the certain paychecks to come with a six-figure attorney?s salary ? only to find after graduation that there are few, if any, jobs available in the legal profession right now.
The recent recession, particularly, has left law school graduates in desperate need of debt relief, with a growing mound of student loan debt and few options for repaying it.
The complaints have focused renewed attention on the ABA, and the professional organization has responded by posting a warning on its website about the risks of attending law college. In part, the ABA warns prospective students that the cost of attending law school has risen at twice the rate of inflation ? a rate comparable to the rise in college tuition for any four-year or professional degree.
The ABA also warns that the starting salary figures that many law schools promote in their literature ? $160,000 at some large and prestigious law firms ? reflect pre-recessionary earnings.
According to the ABA, nearly half of all recent law school graduates who are employed earn a starting salary of less than $65,000. That $65,000 figure turns out to be an important threshold: Many analysts say that newly minted attorneys need to earn at least that much just to stay ahead of their monthly student loan payments.
In addition to shrinking salaries, law school graduates must grapple with the fact that the legal profession has lost more than 15,000 permanent positions at large law firms since 2008. Many of those vanished positions represent job cuts felt by the newest associates ? the most recent graduates of law school and those quoted in the employment and salary statistics offered by law schools in their recruitment and marketing literature.
Some critics say that while employment remains high among top-tier law school graduates, many other new lawyers are suffering because the second- and third-tier schools they attended charge as much in tuition as top-tier schools do but don?t deliver on the prestige and high-quality law school experiences of their top-tier counterparts.
The ABA is now examining whether it should refine the questions in its surveys of law school in order to get more realistic statistics for law school rankings providers like U.S. News. In mid-December, the organization held a two-day hearing in Fort Lauderdale, Fla., to discuss the collection of job placement data.
As these talks lumber on, however, the ABA offers suggestions like these to students considering law school: Attend a local public law school to take advantage of lower in-state tuition rates; live at home to save on transportation and boarding costs; enroll part-time and continue working while in law school.
Ultimately, the ABA?s advice on whether or not prospective students should attend law school is the old standby: caveat emptor.
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About the Author
Jeff Mictabor is an enthusiast on the topic of student loan issues in the news. He has been writing for the past 10 years for a variety of education publications. He now offers his writing services on a freelance basis.
Source: http://www.lechec.com/2012/03/Law-School-Graduates-Awash-in-Student-Loan-Debt/
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