Correction: The number is closer to one lawyer for every 174 people.

I had previously calculated the number of 165 people per attorney erroneously based on a new lawyer production rate of 46,124 new attorneys per year, which is the sum of all law students in the U.S. divided by three.  However, my calculation failed to account for the fact that not all law students will matriculate.  The calculation of 165 was also based on an earlier U.S. population number of 304,060,000.
304,060,000 / (46,124 * 40) = 164.8

Using the number of 44,000 new lawyers per year (as Nando pointed out) combined with the U.S. Census Bureau's population clock and a downward adjustment of 3 million (to estimate the population in June of 2009) , I arrived at a slightly less-depressing number of 174.2. The number of new graduates for 2009 was based on the NALP's number of 40,833 respondents constituting 92.8% of the 2009 class (40,833 / 0.928 = 44,001).

This number is a back-of-the-envelop calculation and depends heavily on the population estimate and exactly when it is counted.  Using the number of 309,557,000 at the U.S. population clock and then estimating a population growth of 3 million people over the past year, we arrive at the figure of 306,557,000 for June 2009.

306,557,000 / (44,000 * 40) = 174.2.

If the population were 300 million then the number would be 170.5. If the population were 310 million then the number would be 176.1.

So, assuming that the number of 44,000 JDs awarded in 2009 is reliable, I think we can safely say that right now the law schools are producing new lawyers at a rate to sustain having one lawyer for every 174 people. Assuming that over time the number of new lawyers produced increases proportionally with population growth then eventually our nation will have one lawyer for every 174 people. However, as is clear from the increase in the lawyer to population ratio that occurred between 2004 and 2009, the increase in the number of new JDs minted each year is outpacing population growth.

------- EDITOR'S NOTE ------- 

March 11, 2011.  I want to clarify that the 40 year average lawyer-to-population ratio that new JD production can sustain (which I eventually calculated to be 1 lawyer for every 171.9 people) is NOT the same thing as the actual lawyer-to-population ratio.  The number I calculated for a given year of new JD production would only reflect the actual lawyer-to-population ratio if the U.S. population remained the same for the following 40 years.  This is because while the U.S. population continues to increase, the number of JDs produced in a given prior year is static and cannot increase proportionally with population growth.

Consequently, Using ABA and BLS stats, the actual lawyer-to-population ratio is about 1 lawyer for every 215 people (only counting JDs minted over the past 40 years). 

One Lawyer for Every 165 Americans?

Based on calculations I have made over the past couple of years using ABA stats for the number of licensed attorneys in 2004 and 2009, LSAC data for the number of students enrolled in the law schools, and Census Bureau projected population data, one out of every 275 people in the United States was a licensed attorney in 2004.  This inverse attorney-to-population ratio decreased to about 258 in 2009, just five years later.  At the current rate of lawyer overproduction where about 44,000 new JDs are produced every year, assuming that a new 25 year old lawyer would want to work for 40 years and that enough new law schools open so that the current pace of new JD production increases proportionally to population growth, enough new lawyers are being produced so that eventually one out of every 165 people will be a lawyer.

If (as reported at various places) students at top schools have been having difficulty finding entry-level jobs in the legal profession when one out of every 258 Americans is a lawyer, how hard will it be to earn a living as an attorney when one in every 165 people is a lawyer?

------- EDITOR'S NOTE ------- 

March 11, 2011.  I want to clarify that the 40 year average lawyer-to-population ratio that new JD production can sustain (which I eventually calculated to be 1 lawyer for every 171.9 people) is NOT the same thing as the actual lawyer-to-population ratio.  The number I calculated for a given year of new JD production would only reflect the actual lawyer-to-population ratio if the U.S. population remained the same for the following 40 years.  This is because while the U.S. population continues to increase, the number of JDs produced in a given prior year is static and cannot increase proportionally with population growth.

Consequently, Using ABA and BLS stats, the actual lawyer-to-population ratio is about 1 lawyer for every 215 people (only counting JDs minted over the past 40 years). 

Law Professor Writes excellent editorial about the Education Bubble. It's a Gem.

I am envious of Glenn Harlan Reynolds, a professor of law at the University of Tennessee, for writing an excellent piece about the higher education bubble: Higher Education's Bubble is About to Burst.  I am envious because he presented the issue in a clear and concise manner and I'm not sure I could have done a better job.

Maybe this op-ed is old news, but I only just discovered it today, in which case it probably hasn't made the scamblogging circuit which is why I wanted to share it with you.  (I found it from a link to this post which I must have found on a fellow scamblogger's post, but I don't think a direct link to Reynolds's article was posted.)

First, Reynolds's did a good job of explaining the bubble victim's mindset:

The buyers think what they're buying will appreciate in value, making them rich in the future. The product grows more and more elaborate, and more and more expensive, but the expense is offset by cheap credit provided by sellers eager to encourage buyers to buy.

Buyers see that everyone else is taking on mounds of debt, and so are more comfortable when they do so themselves; besides, for a generation, the value of what they're buying has gone up steadily. What could go wrong? Everything continues smoothly until, at some point, it doesn't.

He then goes on to explain the potential value of college:

College is often described as a path to prosperity, but is it? A college education can help people make more money in three different ways.

First, it may actually make them more economically productive by teaching them skills valued in the workplace: Computer programming, nursing or engineering, say. (Religious and women's studies, not so much.)

Second, it may provide a credential that employers want, not because it represents actual skills, but because it's a weeding tool that doesn't produce civil-rights suits as, say, IQ tests might. A four-year college degree, even if its holder acquired no actual skills, at least indicates some ability to show up on time and perform as instructed.

And, third, a college degree -- at least an elite one -- may hook its holder up with a useful social network that can provide jobs and opportunities in the future. (This is more true if it's a degree from Yale than if it's one from Eastern Kentucky, but it's true everywhere to some degree).

While an individual might rationally pursue all three of these,

only the first one -- actual added skills -- produces a net benefit for society. The other two are just distributional -- about who gets the goodies, not about making more of them.

It's refreshing to see someone else point out that college education often has no value other than to serve as a proxy for IQ for employers.  In other words, oftentimes college education has no real economic value and a great many jobs that require a college education do not really require it.  Decades ago these types of jobs were filled by people with high school diplomas who worked their way up.  However, as a result of the Education Arms Race we now have a huge abundance of people with college educations so employers can make bachelors degrees a precondition of employment.

My only real issue with Reynolds's op-ed is the implicit suggestion that if everyone majored in a useful degree program such as nursing or engineering that the education would now have economic value.

Post-bubble, perhaps students -- and employers, not to mention parents and lenders -- will focus instead on education that fosters economic value. And that is likely to press colleges to focus more on providing useful majors.

In reality I think it would result in a huge oversupply of unemployed and underemployed nurses and engineers.  If everyone majored in fields that "foster economic value" the education would not have economic value because much of that education would be unneeded excess education that the employment market cannot absorb and thus that society cannot utilize.

The real problem in higher education is simply that we have too much higher education.  In other words, far more people are going to college than our society and economy really needs.  Relatively few career fields actually make use of Reynolds' first category, "education that fosters economic value".  Rather, most college education today is "distributional" in nature in that it merely serves to help employers separate candidates by IQ, ambition, and responsibility.  As a poster at another forum once put it, "If everyone went to college we would have the world's most educated Walmart and McDonalds employees."

Coming from a law professor, Reynolds's op-ed may be profound. I wonder what he thinks about lawyer overproduction and Professor Tamanaha's recent wake up call.

Facelift for JD Scambusting Resources Page

I've just given a facelift to my JD Scambusting Resources Page.  I am hoping to turn it into a central one-stop shopping page for anyone who is thinking about going to law school or who wants more information about the law school scam.  I also added the list of links to articles for further reading, which I hope to continue expanding with worthy links.  The page also includes links to the most active scambusting blogs and the JD Underground forum.

Please check it out and refer prospective law students here:

http://JDScam.blogspot.com

The Chinese Want to Innovate, Too. (Innovation Will Not Save the U.S. Economy.)

If you have ever followed or participated in the debate over Global Labor Arbitrage and foreign outsourcing, then you probably know that one of the common arguments put forth by the free market dogmatists is that we don't need to worry about filthy low-value-added manufacturing jobs because innovation is the future.  They argue that we must become a nation of innovators producing high-value-added goods and services and that innovation will produce tomorrow's jobs.  They will also sometimes argue that Americans almost have a monopoly on innovation and that we are the best at innovating, as though we have some sort of a racial advantage on innovation.

I don't disagree that innovation is good and that it's important.  It is certainly a touchy-feely notion that just about everyone would agree with.  However, I do take issue with their claims that we don't need to worry about global labor arbitrage because innovation will save us.

First off, any manufacturing or production-type jobs created by innovation can be performed less-expensively with fewer environmental and labor regulations in a far less litigious environment overseas.  Secondly, "necessity is the mother of invention", and the people who are directly involved with the act of manufacturing will end up making many of the improvements to the manufacturing process.  Thirdly, the cost of innovation--the cost of R&D--might very well be less expensive in other countries.  (We have been training foreign graduate students for years with our taxpayer supported universities.)

High Tech Research Going to China with Devastating Effects on Our Ability to Compete and on Our Future by Craig Harrington

It was one thing when America lost its textile industry, its toy making, and the production of basic consumer goods. It is another when we begin losing the core research and development that makes our companies operate. There is a growing shift in innovation. We are now outsourcing more than basic goods and simple service jobs. We are outsourcing high-paying work and sparkling facilities that were once Silicon Valley staples.

Multinational corporations have no reason to stay in the United States; they have no incentive to remain in our expensive market. We cannot expect them, and the jobs they support and create, to stick around based on altruism alone. Industries locate, relocate, and grow wherever the economy presents them with the best opportunities. The U.S. was once the focus of those opportunities, but it is no more.

Furthermore, people in other nations want to innovate, too.  For example, in 2004 India produced about 290,000 new engineers.  And guess what?  China wants to innovate too!  Surprise surprise!  According to this NPR report, the Chinese Aim to Build the Next Silicon Valley.

According to the free market dogmatists, we don't need to worry about the loss of manufacturing jobs and we don't need to do anything to protect ourselves from global labor arbitrage because innovation will save us and only Americans are capable of innovation and the Chinese will be content to work the filthy low-value-added manufacturing jobs.  I call bullshit!

Solar Panel Jobs Go to China -- New Jobless Claims Increase -- Surprised?

According to MSNBC, new jobless claims are up and it's a "surprise".  (A surprise to whom, I do not know.)

In other news, last night ABC News reported that a solar panel innovator was unable to obtain funding from the U.S. government to develop allegedly innovative, improved, less-expensive solar panels in the United States.  He said that he had wanted to set up shop in the U.S.  However, the Chinese government welcomed him with open arms and offered him funding and other assistance.  So, now he is setting up his business in China!

Given that, I don't see any reason why an increase in new jobless claims and persistent high unemployment should come as a surprise to anyone.

This story is also notable because it helps refute the mythological notion that innovation will save the U.S. economy.  Many economists, politicians, and pundits have argued that the U.S. doesn't need to worry about the loss of manufacturing jobs because we will innovate our way back to prosperity.  Domestic innovation, they say, is the key to the future and innovation will create new jobs for Americans tomorrow.  Surprise surprise!  Those highly-anticipated new jobs that will be created by innovation can be performed in China by Chinese labor and probably for far less monetary expense than it would take to perform those jobs in the U.S.

"Unemployed People Need Not Apply"

The Huffington Post recently published an article reporting about job advertisements that explicitly state, "The Unemployed Will Not Be Considered."

Still waiting for a response to the 300 resumés you sent out last month? Bad news: Some companies are ignoring all unemployed applicants.

In a current job posting on The People Place, a job recruiting website for the telecommunications, aerospace/defense and engineering industries, an anonymous electronics company in Angleton, Texas, advertises for a "Quality Engineer." Qualifications for the job are the usual: computer skills, oral and written communication skills, light to moderate lifting. But red print at the bottom of the ad says, "Client will not consider/review anyone NOT currently employed regardless of the reason."

Obviously, I find this absolutely outrageous even though this policy is probably nothing new other than its being mentioned explicitly. The only good thing about these types of ads is that they provide yet more evidence that our current free market system does not work. It reeks of class stratification and immobility whereas a free market is supposed to be about opportunity and meritocracy. It also suggests that having a college education is not a guarantor of vocational success because if you have a college degree and you are unemployed you are automatically disqualified from consideration for these types of jobs.

This form of "classism" almost reminds me of racial discrimination--a person could not possibly be qualified for a job simply because they are unemployed and thus necessarily lack the ability to perform the job. It seems almost Orwellian. Applicants will not be considered for a job because they need a job.

If the hiring personnel who decided that being unemployed should automatically disqualify one from a job lose their heads to the guillotine I won't feel badly for them. I'll say, "Good riddance to bad rubbish."

Edit--the company that placed the ad at The People Place is allegedly Benchmark Electronics. According to the HuffPo article, Sony Ericsson is also supposed to have placed a similar ad but later retracted it and claimed that that is not their policy. (Wanna bet that it actually is for the position that was advertised?)

Sony Ericsson, a global phone manufacturer that recently announced that it would be bringing 180 new jobs to the Buckhead, Ga. area, also recently posted an ad for a marketing position on The People Place. The add specified: "NO UNEMPLOYED CANDIDATES WILL BE CONSIDERED AT ALL." When asked about the ad, a spokeswoman said, "This was a mistake, and once it was noticed it was removed."

Is the Housing Crash Over?

The Economic Collapse Blog has published a list of 12 Reasons Why the U.S. Housing Crash is Far From Over.

I have been following the housing bubble crisis for years, and I have long believed that housing prices are overpriced relative to Americans' incomes. I still think housing prices are too high and that they will continue to decrease. The My Budget 360 blog has a great article showing that housing prices are still high relative to people's income. I wonder, how will a nation of student loan-indebted people who work low-wage service jobs be able to afford all of those houses valued at over $150,000?

The Economic Collapse blog's article needs to add a thirteenth reason for a continued plunge. As Baby Boomers age they will start selling their houses, adding houses to the market, in the hopes of downsizing to smaller condos and eventually to nursing homes (and ultimately to cemetery plots). However, a great many people in the generations behind them who didn't do as well financially don't have the income needed to purchase all of these houses at current prices. (The people who have the money will be leaving the market.)

Call for Article Links Related to the Education Arms Race

I am in the process of putting together a list of links to articles and other resources related to the Education Arms Race and the legal job market. My goal is to create a resource where people can find links to the evidence--news articles and documentaries, etc.--that higher education is often a scam.

If you know of some good articles, videos, or studies that I am missing, please send me an email or post a comment with the link.