The story of the legal profession is one of the more interesting subplots to the Great Recession.
There was a time, not so long ago, when if you were an intelligent college student, with some interest in financial stability as an adult, law school looked like a great idea. Assume a fair amount of debt and then graduate and make a lot of money in corporate law.
And then the bottom dropped out.
With the collapse of the American economy in 2008 the legal market imploded. Firms aren’t hiring, and aren’t promoting, the way they used to. Law schools are contracting and many young professionals who assumed all of this debt for law school (The average student loan burden of new law school graduates is $125,000) can’t find jobs to pay it off.
There might be a lesson here, writeRichard Gunderman and Mark Mutz at the Atlantic. Beware aspiring medical students.
The medical profession, like the legal one, is increasingly focused on rankings and metrics, and that’s a big problem for a profession:
Medicine lags behind the law by several decades, but it is now proceeding down the same path. Rankings are playing an increasing role in how medical schools and hospitals assess their performance. We know a hospital that regularly scoffed at such polls until one year it fell in the rankings. Almost immediately, it began taking steps calculated to restore its former status. We know a medical school dean whose annual report regularly focuses on breaking into the “Top Ten.”
Medicine has developed its version of PPP [profit per partner], as well. It is known as the RVU/FTE, or relative value units per full-time equivalent. To their credit, physicians have been a bit more reluctant than attorneys to measure productivity directly in dollars, but RVUs amount to much the same thing. Performing a procedure usually generates far more revenue than talking with a patient, which is part of the reason that procedure-based specialists are so much more highly paid than their colleagues in primary care.
The analogy here is not perfect. The reason lawyers have a hard time finding jobs is because the economy simply doesn’t need to so many lawyers. That would be true no matter how we evaluated their performance.
But the authors have a point. Once we reduce a profession down to profit and units of production, it’s hard to respond effectively when the money stops flowing in. Gunderman and Mutz call this a “zero-sum” mentality, and argue that it meant the “demotion of lawyers from professionals to mere service providers,” even if very well compensated ones. This sort of thing changes the nature of someone’s job and makes it very difficult for members to react effectively to changes.
Medicine is different from law, of course, but we’re increasingly starting to rate hospitals and measure doctors by their productivity. We even call “doctors healthcare providers.”
This is, however, going on at the same time that we’ve introduced a national health care program (such as it is), started to recognize that our existing medical system is incredibly overpriced, and forced huge changes into the system’s finances.
Medical money is going to change, soon, and all of these ratings and productivity measures and “relative value units per full-time equivalent” are going to be trouble for people expecting to pay back $420,000 because of medical student loans.
Don’t say we didn’t warn you.