Often, when the media seizes hold of a story, it finds it hard to let go – even when that story ceases to be true. This tendency was memorably documented by former Guardian journalist Nick Davies in his 2008 exposé of the newspaper industry, ‘Flat Earth News’. In the book, Davies considers how myths that have since been exposed as false, like the millennium bug and weapons of mass destruction in Iraq, have been able to permeate the public consciousness through constant repetition in the press.
But it is not just the mainstream media that tell flat earth news stories. Of late, sections of the legal media have been performing their own version of the distortion that Davies is so critical of, clinging to the default assumption that law students’ job prospects are gloomy despite a change in market conditions that has seen demand for dispute resolution, restructuring expertise and the provision of advice to companies in emerging markets soar. The continued negativity is even more surprising in view of a host of recently released statistics that provide unambiguously clear evidence of an increase in opportunities for prospective lawyers.
The most obvious sign of this growth can be found in the Law Society’s most recent Annual Statistical Report, which recorded a rise in training contract numbers of 11.6% last year, with 5,441 training contracts registered in 2010-11 – up from 4,874 in 2009-10.
Encouragingly, the resurgence in the recruitment of trainee solicitors isn’t limited to a single area of the profession. While Co-op grabbed the headlines earlier this month when it announced plans to create 3,000 jobs in the legal sector and offer 100 training contracts annually within the next five years, the news that leading City law firm Dechert is set to increase its trainee intake passed by relatively unnoticed. Meanwhile, in April, the Crown Prosecution Service (CPS) lifted its two-year trainee recruitment freeze. The first round of applications is already closed, but from October candidates who have not yet completed the Legal Practice Course (LPC) or Bar Professional Training Course (BPTC) will be eligible to apply for a further 15 available places at the CPS – and receive a contribution towards their law school fees.
Of the current state of the trainee recruitment market, Ashurst graduate recruitment partner David Carter comments: "Irrespective of tougher general economic conditions, law firms that intend to thrive need access to the next generation of excellent lawyers and there is intense competition amongst our firms to identify and secure that talent. Provided that applicants market themselves effectively, there will be opportunities."
TLT's graduate recruitment officer Bee Yazdani adds: “From our perspective, we've maintained our graduate recruitment numbers over the last 5 years and made no deferrals, and this year we've more than doubled our vacation scheme numbers for our City office."
Underscoring the growth in training contract numbers has been a better-than-expected bounce-back of law firms’ profit and revenue figures. Again, the signs are that the recovery is taking place across the spectrum of law firms. The Law Society's Law Management Section (LMS) annual Financial Benchmarking Survey shows that practice fee income across the profession increased by one per cent in 2011, with average net profit per equity partner rising from £112,549 to £114,853 – a 2 per cent jump.
In the City, the financials posted by many law firms have been particularly eye-catching. Turnover is up by 8% at Berwin Leighton Paisner, 10% at Taylor Wessing and 12% at Watson Farley & Williams, to name but three firms which have enjoyed strong revenue rises. Meanwhile, profit per equity partner is up a massive 50% at SNR Denton, 30% at Olswang and 14% at Eversheds.
Professional services firm Deloitte crunched the numbers on these figures across the top 100 UK law firms as a whole and found that they posted average fee income growth of almost 7% during 2011-12. Interestingly, firms ranked between 26 and 50 – a bracket which has often been highlighted as struggling recently – were the strongest performers, recording average growth of 9.7%.
In the context of this positive data, it is little surprise that retention rates for newly-qualified solicitors have recovered so sharply over the last couple of years following a notable slump in 2009 and 2010. Average retention rates at the top UK law firms have climbed from 66% in September 2009 and 74% in March 2010, to 82% in September 2011 and 81% in March 2012. Not even in the boom years of 2004 and 2006 were such a high proportion of newly qualified lawyers being kept on by firms.
Nevertheless, the doomsayers continue to insist that the path to qualification as a lawyer is fraught with more dangers than most careers. One frequently-voiced claim is that there is a vast disparity between the number of Legal Practice Course (LPC) places available in a year and the number of training contracts on offer. This rather misleading suggestion is based on two pieces of data: the annual number of available LPC places (15,166 in 2010/11), and the number of training contracts registered (as mentioned above, 5,441 were registered last year).
However, what tends not to get mentioned is the fact that far from all the available places on the LPC are taken up each year. In addition, not everyone who enrols passes the course. A more meaningful, if less headline-generating, comparison is between the number of students who pass the LPC in a given year and the number of training contracts registered. According to the Solicitors Regulation Authority (SRA), 6,293 students passed the LPC in 2011. On that basis, there are 1.2 students per training contract place.
Of course, LPC students face competition from students applying for training contracts at different stages of their education, but a rough guide as to their chances of success can be ascertained from a recent survey by the College of Law of its full-time LPC graduates from 2010. It found that 62% of them had secured a training contract with a law firm. Of those who hadn't, the vast majority had obtained law-related work a few months after passing the course, with only 1% describing themselves as unemployed. The national graduate unemployment rate, meanwhile, stands at 25%
These are the facts. Unfortunately, insufficient attention is often paid to them, contributing to an atmosphere of uncertainty and doubt. As Professor Richard Moorhead of University College London put it in the Guardian recently: "It's a confidence thing. The more doubt the profession shows about its ability to provide students with a safe route into employment, the more it will lose people."