Overview of the U.S. Legal Market

Information and Strategies to Promote Your Law Firm Online

Essential Guide to Law Firm Marketing

By Margaret Grisdela, Legal Expert Connections, Inc.

There are over 1.1 million licensed attorneys in the United States, according to the American Bar Association (ABA). Approximately 42,600 new lawyers emerged from the nation’s 191 ABA-approved law schools in the academic year 2005-2006.

Where do all these attorneys practice law? The vast majority - 74% in the year 2000 - end up in private practice, according to ABA research. The roughly quarter million other attorneys choose to work in government agencies (8%), private industry (8%), the judiciary (3%), education (1%), legal aid (1%) or private associations (1%). Five percent of attorneys are retired or inactive.

The vast majority of attorneys in private practice (70%) work in a law firm with ten or fewer attorneys. In fact, a solo practice is the career and lifestyle choice of almost half (48%) of private legal practitioners. Only 14% of attorneys work in firms with more than 100 lawyers, according to the ABA.

Looking at the legal market in terms of the number of law firms, there were 47,563 law firms serving the U.S. in the year 2000 according to the American Bar Foundation. Just over three-quarters (76%) of law firms have five or fewer attorneys, and an additional 13% employ six to ten attorneys. Only about 1,000 law firms consist of 40 lawyers or more, according to American Lawyer Media (ALM).

Lawyer offices (defined as the primary component of NAICS code 5411) generated $170.8 billion in 2002 revenue, according to the U.S. Census Bureau. In an industry where profits per partner routinely exceed $1 million for top tier firms, according to The American Lawyer published by ALM Properties, Inc., the law is big business.

While it may be hard to imagine, U.S. residents filed over 100 million new lawsuits in state courts in the year 2003 alone, according to the National Center for State Courts (NCSC). The majority of these lawsuits (54.7 million) involve traffic matters, followed by 20.6 million criminal cases. Not all attorneys handle litigation, but those who do have plenty of work to keep them busy.

Median starting salaries for law firm associates range from $45,000 to $125,000 depending on the size of the firm and associate year, according to the National Association for Law Placement (NALP). The U.S. Bureau of Labor Statistics reports that the mean annual wage for lawyers is $110,520.

While the law can be a lucrative career, it can be very expensive to become a lawyer. The average annual private law school tuition for 2005 was $28,900, according to the ABA. Public law schools averaged $13,145 per year for residents and $22,987 for non-residents during the same school year.

As you might expect, many law school students find it necessary to borrow money in order to finance their legal education. The NALP determined that 94% of law graduates responding to a 2002 survey borrowed a median of $84,400, excluding undergraduate loans, to finance their legal education.

About the Author: Margaret Grisdela is the Founder and President of Legal Expert Connections, Inc., a legal marketing firm specializing in marketing and business development in the legal and litigation support  markets.  You can reach her at mg@legalexpertconnections.com.

Copyright Margaret Grisdela, Legal Expert Connections, Inc.

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