How The Legal
Profession Can Improve Employment Prospects For Law Graduates…
The Working Group
established by the Law Society of New South Wales in June 2014 carried out
considerable work and provided a 29-page “Future Prospects Of Law Graduates” Report
to Council in late April 2015.
The eminent Working
Group drew on a wide range of available data, but concluded that a lot more
useful data is needed, and indeed four of its nine Recommendations related to a
perceived need to improve data.
There seems to be a
marked mismatch between the perception of, “…anxiety within the Legal
Profession and law schools about a lack of employment opportunities for law
graduates”, a key finding of the Report, and one conclusion of the Report that,
“…it appears that NSW law graduates are not
(my emphasis) exceeding new entrants to the NSW Profession”.
A recent survey of law
students drawn upon in the Report indicated that at least 50% of students
report feeling stressed most or all of the time about finding a relevant job
after they have graduated.
Whether or not there is
a real problem with employment prospects for law graduates in NSW or the wider
Australian market, my concern is that an obvious area of opportunity to widen
potential jobs for graduates has not been dealt with meaningfully in the Report.
The problem has not in
any real depth been addressed from the perspective of increasing substantially
the potential private practice positions available to graduates.
There is a
Recommendation to develop strategies to increase participation by firms, and
other potential employers, in Law Society Graduate Employment and Summer
Clerkship programs, but it does not in my view go nearly far enough.
At present, involvement
in these programs is quite modest, and mainly by the larger firms, and the
Working Group acknowledges this. A very quick scan of the list of firms
participating in 2015 reveals almost no small firms.
At any event the
particular program is of relatively narrow scope. It can be improved no doubt,
but frankly small firms would be better to spend all or part of the Annual
Participation Fee of $770 on highly relevant training they can apply year in
year out.
What is not addressed
is that the vast bulk of private law firms in NSW (the main potential
employers) is made up of small firms, with 4 principals or less, and around 75%
of firms have just one Principal. There are many thousands of these firms and
great potential to employ more graduates.
If the creation of
increased job opportunities for graduates is a desired outcome, I would have
thought that a dramatic improvement in targeted training for small firms across
the State (and country) in how to effectively
use graduates would need to be the order of the day.
With the median
starting salary for NSW graduates at $55,000, there is an obvious perceived
barrier for smaller firms if they do not understand exactly how to manage the
dynamics and economics of employing graduates.
They need specific
training to show them what to do, so they have the confidence to take the
plunge and employ graduates.
For most small firms,
employing a graduate cannot be altruistic. The application of the graduate’s
abilities, alongside others in the firm, to a client’s challenge, has to
provide a reasonable return. In addition to the short-term benefit, there will
be a longer-term strategic benefit from those graduates who remain with the
firm. More experienced lawyers who have proven themselves and understand the
firm’s culture are gems indeed.
When the Principals of
these firms read in the Report, and in comments in legal media, that, “…lawyers
- from recent graduates through to senior partners – have to play a new game in
which the rules for forging a successful career are still being established”,
it does not give them increased confidence to become the employer of a
graduate.
What they do need is
relevant practical examples of how small firms just like them are already successfully
employing graduates, and making them important parts of their teams, dealing both
with today’s economics and building legal talent for the future.
They do not need to
hear yet again that, “… pricing pressures, globalisation, new technologies and
shifting demographics have altered the legal services market”.
We all know that the
Profession continues to change rapidly, but many of the major trends in the
Legal Profession are for the time being impacting firms outside the small firm
group.
Of course some are
vigorously using technology, and lower-cost offshore resources, and many feel
pressure on pricing, but for the vast majority of smaller law firms these are
frankly not presently barriers to employing graduates.
Anecdotally, many of
the small firm Principals perceive that the “better” graduates get employed by
the larger firms, and that the candidates left for them to pick from are
somehow less than ideal, perhaps needing more scarce resources applied to them
to make them “useful”. This is simply not the case. The quality of candidates
available to small firms is quite exceptional.
The main issue in my
experience is confidence, and we need to create programs to create or restore a
healthy level of confidence in as many potential small firm employers as
possible.
The target audience
needs programs that teach:
Sensible pricing
approaches…where the “billable hour” is much less relevant…
Sound marketing
approaches, to increase enquiry for services and reduce pressure to get new
instructions at almost any cost…
Practical people
management skills…
Modern budgeting…
Accurately tracking
“performance”…
Supervision and
training skills…
How to provide
appropriate feedback and maintain motivation in employees…it’s way more than
the simplistic (and almost always ineffective) bonuses!
Most, if not all, these
areas are ones in which many Principals in small law firms can do with training
in any event.
There are many
challenges to small law firm profitability, and most of the answers lie in the
management skills of the Principals. My observation from the 1330-plus firms
I’ve been involved with is that where the Principals have the right ambition,
and are willing to improve their skills, they reap the rewards in improved
Professional satisfaction and in profitability.
Ongoing strong profitability
is important because it greatly assists with the financial health of firms,
helps reduce stress, and allows firms that wish to take more sensible
commercial risks to do so.
Certainly the more
profitable smaller firms these days almost always have much greater than
average leverage between Principals and employees, and successfully managing
that dynamic requires improved management skills.
Smaller firms tend to
find it more difficult to employ managers with the right skills, and often
operate with a delicate balance between Principals’ skills and greater
experience brought to the table by proven consultants, across the necessary
range of disciplines.
It should be noted that
the Working Group did try to draw on wide contributions, including seeking
contributions from Regional Law Societies, but its references to consultation
in the Report do not make any reference to Management Consultants working with the
Profession, in firms large or small.
Many of the small law
firms I’m involved with employ graduates very successfully, but I’m very aware
why many say they do not.
Improved,
cost-effective, training may well be a big part of the answer to creating
greater employer participation, increasing opportunities for graduates and, over
time, reducing stress levels.
The right sort of
training will also be very relevant to small law firms getting proper returns
from employment of Law Clerks, Paralegals, Conveyancers, and even the more
experienced lawyers.
It will be interesting
to see if targeted training of the required type is developed.
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