This is the first post in a series which will discuss what is happening to the legal profession in 2018. I feel it’s necessary to write on this topic due to the fact that data is showing that the attorney bubble, which has built up for decades, is unwinding. In short order, quite a few attorneys are going to wind up looking like this:
The legal profession, year to date, has lost roughly 1,100 jobs. These losses, unfortunately, will be kicking into high gear due to the effect of technology and the wind down of our country’s war against marijuana. Over the course of this series I’ll be discussing the following:
- What fueled the current “bubble” that the legal profession is in
- How and why the bubble is rapidly bursting
- What successful law firms will look like over the next 12-24 months
These articles will be different from what I usually write in that they will be quite, quite, quite, quite…….quite long. That’s due to the fact that attorneys need to understand what is happening to the profession and what changes they need to make right now!
First, all bubbles are “fueled” by something. The 2007-08 financial crisis, for example, was fueled by investor’s willingness to buy subprime mortgages – once investors no longer wanted to buy those mortgages then the whole system went boom! The attorney bubble has been fueled, largely, by auto accidents and the war on drugs (mainly the war on marijuana). From 1980 to 2017 the U.S. attorney population increased by 132 percent even though the total number of people in the U.S. only increased by 43 percent during this same time frame. That’s a bubble.
Second, as to why the bubble is bursting, consider the fact that the bulk of work which attorneys perform involve solving problems which have already occurred – such as a car wreck, an arrest, a wrongful termination, etc:
- Auto deaths declined, on average about 1.59 percent a year from 2007-16 due to improvements in car safety technology. As I discussed in my article on the decline of personal injury law, that trend has kicked into overdrive in 2018. As of this morning, some preliminary data I’ve been tracking on a daily basis (from the only eight states which actually provide up to date data on this stuff) shows that auto deaths, year to date, are likely down somewhere in the are of 7.6 percent from the same period last year. This decline can be expected to ramp up as the year moves forward.
- Claims made with the EEOC declined by roughly 8 percent in 2017, and have been trending down for years, due to the automation of many jobs. This is only going to accelerate for reasons which I’ll discuss.
- Technologies such as Uber and Lyft are rapidly reducing the number of DUI’s.
- Changes in marijuana laws and other social factors are quickly reducing the need for criminal and family law lawyers.
I’ll be discussing these issues at length, and providing statistics/information to back them up in the second substantive post of this series.
Finally, the legal profession is about to see a rapid period of consolidation between firms. A larger and larger percentage of the profits will be going to a smaller and smaller number of lawyers. I’ll discuss what you need to do to be one of ‘da cool kids.
The good news in all this is that law school applications are actually way up! So more attorneys will be dumped into the system in short order.
What trends are you seeing in your practice in 2018? Please chime in through the comment form below.