Volunteering at church. Working part-time at a bookstore. Selling real estate. All are worthwhile pursuits, but not exactly what Peter Marshall thought he'd be doing after he graduated from Vanderbilt Law School this spring. Particularly since he received a coveted offer last September to join a white-shoe Chicago firm, Kirkland & Ellis.
Then the economic crisis set in, and as legal work across the country has dried up, many large and mid-sized firms have turned to a surprising cost-cutting strategy: paying incoming first-year associates whose starting annual salaries at Manhattan firms is $160,000 not to show up. So far this year, Marshall and hundreds of other third-year law students at prestigious schools have seen their job start dates pushed back anywhere from just a few months to a full year, leaving those affected scrambling to find other options to fill the time off. "To get my stipend from Kirkland, I can't take on any other paid legal work," says Marshall, whose job is now set to begin Nov. 30. "So I'm just going to take advantage of a little extra freedom this fall." (See how Americans are spending now.)
At first blush, receiving a generous stipend sometimes as much as $75,000 to do whatever your heart desires might not sound so bad. But for young lawyers facing upwards of $200,000 in law school debt, the outlook is less rosy. For starters, there's the very real possibility that that the deferred job may never materialize nearly 5,000 veteran attorneys have been laid-off since last September, according to industry website Lawshucks.com. "I'd love to take the money and go backpack around Thailand," says David Kirchblum, who graduates from Boston College's law school next week and had the start date for his job at New York firm Milbank Tweed pushed back to January 2010. "But if I suddenly have to find a new position, that gap is going to be difficult to explain."
Some firms are forcing deferrals on incoming associates while others are taking a choose-your-own-adventure approach. Stroock & Stroock & Lavan in New York has offered incoming associates three options: start in January 2010 and get a $10,000 stipend, start in January 2011 and get $50,000 or agree not to come at all and get $75,000. Which sounds great until you remember that finding another firm job or any post-graduate work at all at this point will be next to impossible in this economy. (See 10 ways your job will change in the future.)
For associates who start their jobs a year late, the delay could have consequences in terms of earning potential and making partner, which is generally an eight-year war of attrition among the group of lawyers who start working the same year. "This will definitely be a setback for the classes of 2009 and 2010, who are now on a collision course," says James Leipold, executive director of the Washington-based National Association for Law Placement. "They'll find themselves competing for jobs and money the rest of their careers."
That fear has many deferred students searching for ways to ensure their legal skills remain sharp, and several firms and law schools have stepped in to help. Boston College, for instance, will let its graduates audit classes next fall for free. UCLA Law School has announced a Masters of Law program designed specifically for deferred associates. A number of firms have also begun matching their recruits to pro bono opportunities. That's the option University of Pennsylvania Law School graduate Susan Wilker took when her job at Boston law firm Ropes and Gray deferred until at least January. Wilker will have her health benefits paid and receive $60,000 for working at Massachusetts Appleseed Center for Law and Justice, a nonprofit that focuses on education discipline and juvenile justice. "Because I know I can go back to Ropes in 2010, I am really excited to do something entirely different," Wilker says. And as one of only three staffers at the nonprofit, she adds, "I know I can make an impact."
For sure, the start-date delays have been a boon for public interest organizations around the country. Research shows that some 80% of legal needs go unmet among low-income Americans, and organizations that serve such clientele, such as the Legal Aid Society, now have their pick of top law school graduates most of whom will arrive with a paid salary and health benefits attached. But the public-interest groups still have to finance the infrastructure required for an extra person on staff. Many nonprofits have seen their own revenues fall in recent months and undertaken layoffs themselves. Just finding the money for another computer can be hard, says Esther Lardent, president of the Washington-based nonprofit Pro Bono Institute, never mind the cost of training and supervising of a brand-new lawyer. "Morale and office tensions also have to be considered," she adds. "At $75,000, these young people might be getting paid more than the most experienced attorney on staff."
Kirchblum, for one, is now hunting for volunteer legal jobs overseas amid final exams, graduation and taking the bar exam. His biggest concern is money because he will only receive $20,000 from Milbank for being deferred, and he owes more than $100,000 in student loans. "Why I chose to take a firm job or even to go to law school in the first place was it seemed like the stable, responsible path," he says. "Now everything has been thrown up in the air."