Law school graduate salaries fall into a strange, arguably unhealthy pattern for a labor market. Whereas legal talent likely falls into a normal distribution, law school graduate salaries form a bi-modal distribution.
Salaries cluster into two disparate groups. The left-side group is between $40,000 and $65,000. This group accounts for a little over half of reported salaries. (The median salary was $63,000 in 2014.) The left-hand peak is at $50,000 and accounts for about 11% of reported salaries. The right-side group peaks at $160,000, which accounted for about 17% of reported salaries. There are graduates between the peaks, but the gulf indicates a bidding war for top graduates.
While this curve is instructive in many ways, it does overstate graduate salaries in two key ways. First, the curve only reflects employed graduates in full-time, long-term jobs. About a quarter of the 2014 graduating class did not meet this specification. For NALP's purpose of understanding salaries post-law school, exluding non-employed graduates (54%) and graduates with part-time or short-term jobs (38%) makes sense. But if the purpose is to shed light on near-term graduate financial outcomes, the curve exhibits exlusion bias.
Second, the underlying salary data for long-term, full-time employed graduates suffer from non-response bias. Although the response group is quite large at 68% of all long-term, full-time employed graduates, the non-response group looks quite different. The response rate of graduates at large firms, which pay a lot, is much higher than at small firms, which pay significantly less. Jobs at the largest law firms (>250 attorneys) account for 27% of private practice jobs, but 42% of private practice salaries because the salary response rate is over 96%. The respone rate declines with firm size. At the smallest firms (10 or less attorneys), the respone rate is 45%. These firms should represent 41% of private practice salaries, but only represent 30%.
It's logical that graduates with higher salaries are more likely to report than if they had a lower salary. That likely explains some of the gap. But another factor is that salaries at the largest law firms are publicly available through NALP. Public information also explains why judicial clerks and government employees have the highest salary response rates.
The bi-modal distribution demonstrates how the mean salary obscures a more complicated reality. NALP also includes an adjusted mean on the chart, but it adjusts only for non-responses and not for the exluded group, including non-employed graduates. Both the adjusted and non-adjusted mean are very sensitive to the proportion of large firm jobs.
The median, on the other hand, is not as sensitive to vastly higher salaries produced by that part of the labor market. The chart below shows the change over time of median salaries overall and by the type of employer (e.g. law firm or government). In each group, graduate salaries have steadily increased over time. But the overall median ("All Full Time") is still rather sensitive to the number of large firm jobs, though the effect is considerably more apparent when observing the median salary at law firms of any size.
Tip On the left panelAt the top of the page, you can change the data scope to view jobs from different angles.
The following chart compares median salaries by the type of employer, regardless of the type of job, in both real and current dollars. In recent years, the median salary has not kept up with inflation. The default view uses a base year of 2005 because that year was relatively stable and between the two recent recessions. To use a different base year, select it under "modify data" above. By default, only "All Full Time" is visible on the chart below. Toggle any category on the legend to toggle visibility.
The next chart examines salaries using both real and current dollars for law firms by size. By default, only the largest and smallest firm categories are visible on the chart below. Toggle any category on the legend to toggle visibility.
Salaries have largely kept up with inflation, but tuition has far exceeded inflation for three decades. This erodes the long-term value of the degree, while the near-term struggle to service student debt persists. The following three charts demonstrate this, but the national tuition page explains the relationship between tuition and inflation in more depth.
About the Data
Graduate salary data come from the National Association of Law Placement.
For tuition, nationwide averages from 1985 to 2013 come from the American Bar Association. Starting in 2014, LST calculates the nationwide average from individual schools, using data the schools reported to the American Bar Association. LST uses normal averages rather than weighted averages for the nationwide averages in 2014 and later. The ABA uses normal averages from 1985 to 2013.
LST uses the Consumer Price Index (CPI-U) for inflation, which covers 89% of the total U.S. population. For an explanation of various indices to compare tuition over time, see this paper.