Updated with document link below.
I just read an intriguing report of a symposium on "The Debt Crisis in the Legal Profession." Here are some notable excerpts:
"[A] time of true crisis in the legal profession may be just ahead. Data . . . indicate that law graduates are defaulting on their educational debts in disproportionately high numbers, and, according to the responses generated by financial aid and admission professionals during the Symposium, the debt/default phenomenon could have a dire outcome unless the entire legal community comes together in an effort to resolve it."
"[Data show that many graduates are leaving school with law school debt that exceeds the median starting salary for new lawyers] and will be faced with the possibility of allocating nearly 20 percent of [their] net monthly income to debt repayment."
"[Even higher debt loads] are relatively common among today's law graduates, yet, at the same time, NALP's data show that the prevalence of full-time legal and private practice jobs has been in sharp decline over the past four to five years, and compensation for entry-level attorneys has remained relatively flat . . . ."
"The evidence offered by the Symposium participants suggests that educational debt has a tremendous impact on graduates. At the least, it appears that debt dictates the types of jobs new lawyers can consider after graduation, assuming their desire to sustain good credit and repay their loans."
"Given the constrained legal job market, debt simply adds to the incredible stress and anxiety law students experience--particularly when these new would-be professionals realize the true implications of the job-salary-debt equation. Moreover, debt has an insidious way of precipitating frustration and anger in graduates--who may focus their emotions on themselves, their law school, or the profession in general. . . ."
"Within the law school community, there are voices suggesting that employers can help solve the debt/default problem by simply increasing entry-level salaries. Symposium attendees agreed that such a short-sighted solution would likely have only one long-term effect--further exacerbation of an already tight job market as 'fewer hires get paid slightly more.'"
". . . There was strong agreement among all Symposium participants that the pressure is now on law schools to take action to ameliorate the crisis. Possible responses include: increase the consumer information provided to pre-law and entering students; limit or decrease class sizes; increase the intensity of entrance counseling regarding debt; funnel additional resources into loan repayment and loan forgiveness programs; increase the amount and availability of grants and scholarships; and stop the escalation of tuition costs."
"The dichotomous data on the profession was disturbing to Symposium participants. When they recounted the facts--full-time legal and private practice jobs have been in steady decline, salaries have plateaued, graduate numbers are at the highest level . . . , and default rates of attorneys are the highest among all professional groups--they agreed that this may well be the early stages of a crisis of considerable proportion."
"Additionally, participants noted the impact of these events on the media and public, who cynically allege that 'there are too many lawyers,' espouse distrust of the profession, pose the possibility that a significant number of attorneys may be underemployed, and report that a large cadre of law school alums are disenfranchised from the profession and from their law schools. . . ."
"NALP employer members suggest that law graduates who can 'hit the ground running' are and will continue to be in great demand. Therefore, NALP and its members can continue the effort to support the development of 'gapless curricula' which will help provide graduates with essential skills and knowledge that will allow them to compete with laterals and technological innovations that have constrained the entry-level market. . . ."
"The concluding remarks of the Symposium revealed that the debt crisis cannot be averted: it is already upon the profession. However, there was agreement that it can be ameliorated somewhat if all stakeholders, including students, law school deans and faculty, lenders, admission and financial aid professionals, legal employers, and law-related or affiliated organizations work together toward solutions."
This symposium occurred in October 1995. You can read the report here.