“I thought I’d have a law firm job for four to five years, then go in-house and make the kind of money to live a comfortable lifestyle,” says Brooks, who got laid off from that law firm job in 2009, a year after graduation.
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That’s when Vikram Arneja, a mergers and acquisitions associate, started at New York Law School, having noticed that attorneys were “very instrumental” in debt, equity, and foreign exchange deals. “We didn’t understand the full picture that was unfolding,” he says now.
Today, both find themselves in unexpected places. Brooks, of Merrillville, Ind., is doing temporary work for Robert Half Legal, a large Menlo Park, Calif.-based legal staffing firm. Arneja is now in Chicago, serving as a manager of corporate and litigation services at Mindcrest Inc., a legal process outsourcing (LPO) firm, where he had interned as a student.
Mindcrest helps companies and big law firms reduce the cost of document review and other basic legal needs. Harnessing technology and cheaper domestic and foreign lawyers, LPOs have become a rising force as law firm clients and corporations have begun demanding a break from pricey billable hours. Firms like Mindcrest boast saving clients as much as 70 percent on legal support work, says Arneja.
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The LPO industry’s revenues are projected to double between 2011 and 2014, according to consulting firm Deloitte. “You’re seeing movement” in both LPO and temp positions, says Mark Medice, senior director of the Thomson Reuters Peer Monitor service, which tracks the legal industry.
Brooks, who estimates that she makes “the same as a mid-level associate at a small or medium firm,” does document review, oversees other contract attorneys, helps manage projects, and deals with clients. “I’ve had only one week of downtime since last September,” she says.
Contract work “has become much more of an accepted norm,” says Charles Volkert, executive director of Robert Half Legal. On average, members of the class of 2011 who pursued legal temp work made $52,000, says James Leipold, executive director of NALP–the Association for Legal Career Professionals.
“We grew from 300-plus lawyers three years ago to 550 to 600 now,” says Ganesh Natarajan, Mindcrest’s CEO. Besides Chicago, the firm has U.S. offices in Los Angeles, New York, and Salt Lake City. Arneja scopes out client projects, develops a workflow process, manages attorney teams, and provides legal research and drafting services.
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As for the bigger picture, there’s no beating around the bush: The job market for young attorneys remains a tough one. Medice notes that industry revenue growth in 2012 was a paltry 0.5 percent, and “2013 looks about the same.”
Only about 10 percent of the employed grads in the class of 2011 landed at a big firm with 251 or more attorneys, about half the number in 2009. Just 49 percent went into private practice, and 43 percent of those to firms with 2 to 10 lawyers, says Leipold.
The migration from big to small (and temp and outsourced) law is a big reason why average starting salaries in private practice fell sharply–from $130,000 to $85,000–between 2009 and 2011. Half of all new attorneys made less than $60,000 in 2011.
Arneja and Brooks both think their detours will put them in good standing to someday work at law firms or in other legal positions. Indeed, says Volkert, lawyers with five-plus years of experience, business development skills, and client contacts in hot areas such as litigation, general business, and healthcare law are actually in demand.
This story is excerpted from the U.S. News Best Graduate Schools 2014 guidebook, which features in-depth articles, rankings, and data.