Lately there has been a lot of buzz in the blogosphere on the associate-partner "pay gap" (Jeff Lipshaw, titled "The Days of Whine and Roses"), the application of Marxist economic theory to corporate law firms (David Luban), and what all the huge salaries and profits augur for the future of legal profession and legal education (Brian Tamanaha).
All of it is worth reading, especially Tamanaha's insights on the growing fissure between elite and nonelite law schools. (For a scholarly treatment of this topic, see Randolph Jonakait, The Two Hemispheres of Legal Education and the Rise and Fall of Local Law Schools, NYLS L Rev (forthcoming 2007)).
David Zaring and I recently posted our "Young Associates in Trouble" essay, which provides some new empirical evidence on the BigLaw tournament. The essay reviews two recent novels that portray elite law firms (one in DC, the other in London) as an unending marathon of boring and substantively unfulfilling work. In turn, we compare these fictitious accounts with findings from a unique dataset based on the AmLaw Midlevel Survey, which includes questionnaire responses from several thousand 3rd, 4th, and 5th year associates.
So what is the key takeaway? As shown in the table below, virtually every principle of enlightened management and social responsibility is either (a) associated with lower firm profits, or (b) irrelevant to the bottomline.
The essay also includes some multivariate regression models that reveal that firms actually make more money when associates work on less interesting work or report a greater likelihood of leaving the firm within the next two years. In contrast, family friendliness, training and guidance, and feedback appear to have no effect on profits.
More empirics and another graph after the jump.
Obviously, young lawyers are compensated for their hardship, first in salary and bonuses, and second in the outplacement options that elite white shoe firms provide.
One way to gauge the appeal of these jobs is to examine the proportion of graduates from elite law schools--a population with the most employment options--who begin their careers at the most prestigious (and grueling) law firms. The table below breaks down new attorney hiring patterns by law firms (Top 10 / non-Top 10) and law schools (Top 10 / non-Top 10).
Obviously, as this table shows, elite law school graduates tend to experience harsher work conditions. A lot of ink is spilled over their miserable plight as if it reflected the state of the profession as a whole.
But large law firms are not a single oppressive monolith. As the above graphic makes clear, graduates of elite law school ultimately have a choice to join a large firm that is (a) less prestigious and remunerative but (b) is more family-friendly, provides better prospects toward partnership, and requires significantly fewer hours. Indeed, the 25th percentile workweek in our sample is 54.2 hours, which is only slightly more than other lawyers beginning their careers. See ABA Young Lawyers Division Survey: Career Satisfaction (2000); After the JD: The First Results of a National Study of Legal Careers (2005).
The main question we wrestle with in the essay is why elite lawyers are so reluctant to let go of a work environment that imposes significant costs on their personal lives. Sure, economists are comfortable concluding that health and relationships can be traded for current and future financial gains. But you let go of an external measure of success and accomplishment when you depart the white shoe world. If your whole life--college, law school, clerkship, employment at a fancy firm--has garnered external acclaim, many young lawyers may be reluctant to forgo prestige in favor of a more reasonable work-life balance.
There is an undeniable existential dimension to these trade-offs--a topic perhaps most effectively explored through a novel. Young Associates in Trouble was a fun and challenging essay to write. In case you are wondering, we give a strong thumbs up to Kermit Roosevelt's In the Shadow of the Law.