Recent trends in the legal profession have shifted focus to defending corporates rather than individuals according to observers.
Student loans estimated by a Forbes report to be a $1.3 trillion dollar crisis in United States. The loans are particularly massive for law students who often don’t consider how they will pay for their education while just focusing on how “rich” they would become.
The bar passage rates across U.S. continue to be low, and furthermore non-elite law schools are winding up. Just recently Whittier Law School became the latest to shut shop. Valparaiso Law School is another law school that shut down earlier this year.
The combination of these factors is causing a “perfect storm,” which is in fact, bringing about a significant change in the legal profession – the decline of ‘PeopleLaw’.
Economic Stress Causing Small Legal Outfits To Move Away From PeopleLaw Practice
More and more lawyers are choosing to represent corporate entities rather than individuals. Corporates are likely to pay up regularly which encourages lawyers to chase their business.
Small law firms or solo practitioners are under high levels of economic stress as shown by Clio’s 2017 Legal Trends Report. Solo/small firm lawyers typically bill at an hourly rate of $260 on an average, which can make it hard to pay off loans.
According to the Clio report, solo/small firm lawyers usually have just about two billable hours per day. The rest of the day is spent on administrative matters like billing or collections and on business development.
The report further notes that the average annual gross receipts for such small firms is in the range of $105,000. Out of these essential expenditures like such as overheads, health insurance, malpractice insurance, and taxes are required to paid.
In the end , the net income is often “considerably less”. As a result, lawyers struggle to pay student loan debt and their living expenses. Naturally, legal practitioners prefer corporates as clients rather than individuals.
This has however resulted in lower access to justice for people who are unable to afford big law firms or don’t necessarily need them.
Declining Representation of Individuals Can Be Harmful For The Profession
Industry observers are worried at the trend of lower access of legal help for individuals.
If there is no balance between representing corporate entities and individuals or the PeopleLaw sector, it could doom the profession as a whole.