It's becoming increasingly clear that, for a very large percentage of recent law graduates (perhaps an actual majority) the expected return on investment on a license to practice law hasn't been worth the cost of acquiring one, and that, given ongoing structural changes in the economics of the practice of law, and the rapidly increasing cost of legal education, this problem is only going to get worse going forward.
Legal academia has several options in regard to how it's going to deal with what appears to be a growing crisis in regard to its long-term financial viability. Now it's probable that, even given these ongoing changes, a handful of law schools will still be able to provide a reasonable ROI for a large enough percentage of their students to allow these schools to continue to operate without any significant change in the way they currently do business. But it also seems probable that, for the vast majority of schools, that won't be a viable long-term option.
This is by far the most popular option at present. It takes the form of treating changes in economics of law practice as temporary rather than structural, ignores the fact that even prior to the recession a third of law grads weren't getting law jobs, and treats the skyrocketing cost of legal education as a product of forces beyond legal administrative control. The upside of this approach is that it doesn't require anyone to do anything. The downside is that, except for a handful of elite schools, this approach won't be sustainable in the face of economic reality.
(2) Moving to a consumption model of legal education
A consumption model of legal education assumes that there are a sufficiently large number of students for whom legal education can be modeled as consumption rather than investment. Schools operating on this model will have a large number of students who are treating law school in the way that affluent families have traditionally treated undergraduate education, that is, as a kind of high-toned finishing school whose main functions are social signaling, networking, and conspicuous consumption, rather than as a way to acquire more straightforwardly marketable skills. (That undergraduate tuition seems to have some of the characteristics of a Veblen good suggests that this model is in fact quite viable for elite undergraduate institutions).
Given the social cachet still associated with the identity of the lawyer (which can of course be overstated and may be deteriorating) this model may be viable for some schools. This approach could prove particularly successful for schools located in places where rich people and their children like to congregate -- for example wealthy college towns with good weather, excellent restaurants, and easy access to first-rate ski resorts -- although needless to say the supply of reasonably literate trust fund slackers seeking more respectable social identities is, even in contemporary America, somewhat limited.
The third option for schools outside the charmed circle of the elite is to change or (eventually) die. Change will come in the form of cutting operating costs significantly, and restructuring what law schools do in ways that will allow them to take advantage of new sources of operating revenue, such as for example contributing to undergraduate education, and selling new degree programs catering to people who want to do something other than practice law.
Operating costs can be cut in many ways, some of which will probably include larger teaching loads for tenure track faculty, larger percentages of classes taught be adjuncts -- ABA accreditation standards currently put strict limits on this option, but those are likely to give way in the face of economic pressure -- serious cutbacks in law library budgets, less extravagance in regard to physical plants, and a reduction in an administrative class that has more than tripled in size at law schools over the course of the last decade.
All of these changes will be painful for people currently working inside of law schools, so little can be expected to happen in this regard until the scope of the growing crisis makes it clear that option (1) is no longer viable. How long that will take is difficult to predict, and of course is likely to vary a good deal depending upon a school's position in the legal academic hierarchy.