(LANSING STATE JOURNAL) - From the outside, what was happening at Thomas M. Cooley Law School in the fall of 2010 looked like another chapter in the school's explosive growth.
Enrollment topped 4,000 students, spread across four campuses in Michigan. The newest, in Ann Arbor, had opened the year before. And, though it's a nonprofit, Cooley was pulling in money. It began that fiscal year with $90 million in net assets and closed it with $111 million.
In retrospect, it was a high-water mark. Students had flocked to law schools after the economic meltdown of 2008. Cooley's leaders didn't pass on the opportunity.
Enrollment has fallen sharply since. Cooley had 3,219 students last fall, even after the opening of a fifth campus near Tampa, Fla. Don LeDuc, Cooley's president and dean, said the entering class this fall will be "significantly smaller" than the previous year. As for the money, he calls it a nest egg.
"Our model has basically been the grasshopper and the ants from your fables," LeDuc said. "We set aside a fair amount of money to weather what we thought the storm would be. Our only concern is how long this lasts."
And not without reason. The number of law school applicants nationwide has fallen by nearly one-third over the past three admissions cycles. This year, it dipped below 60,000 for the first time in decades and shows signs of going lower. The number of people who took the Law School Admission Test in June was down 4.9 percent from the year before.
LeDuc believes this a cyclical downturn. He said the effects of a bad economy have been "exacerbated by the stuff on the Internet."
His prediction: The economy will improve. Government agencies will start hiring lawyers again. The older generation of lawyers will retire. Students graduating in three or four years will find a much more welcoming job market.
It's hardly a consensus opinion, even among law school deans.
As a group of 67 law school professors and deans calling themselves the Coalition of Concerned Colleagues put it in an open letter to the American Bar Association earlier this year, "The federal government estimates that, at current graduation rates, the economy will create about one new legal job for every two law school graduates over the next decade. Most knowledgeable observers believe that the situation is unlikely to improve even if the economy fully rebounds."
Weak job market
In January 2011, The New York Times published a story on the weak job market for new lawyers and spiraling loan debt for law school graduates, which some were finding difficult to pay back.
It set off an avalanche of similar coverage and, in effect, inaugurated new narrative that focused on the growing uncertainty of what had once seemed like a staid and certain career path.
Changes in the American Bar Association's reporting requirements that went into effect the following year were even more sobering. For the first time, the ABA required law schools to report whether their graduates were getting jobs that required passing bar exams. As it turned out, many weren't.
Just 56 percent of those who finished law school in 2012 had full-time, long-term legal jobs nine months after graduation. For Cooley's graduates, it was 29 percent.
"The combination of those two things woke up the applicant pool," said Brian Leiter, a professor at the University of Chicago Law School, who runs a blog on legal education and the legal profession.
And it's the middle and lower-tier schools - "the bottom 100" of the 203 ABA-approved law schools - that are really feeling the pressure, he said.
Cooley hasn't cut faculty positions like some other schools, but it has allowed vacancies to remain unfilled, LeDuc said.
This fall, it will raise tuition by 9 percent for first-year students, bringing the cost of the first 30 credits to $43,500, and by 8 percent for everyone else.
It hasn't lowered its admission standards, LeDuc said. The median LSAT score of its entering class slipped from 146 two years ago to 145 last year, but that reflects a reduction in the number of higher-scoring applicants rather than a drop in the school's minimum requirements for admission, he said. But LeDuc doesn't see a drop in minimum requirements as out of the question.
"Sooner or later you've got to make a choice," he said, "because you need enough revenue to cover what your expenses are."
The drop in Cooley's enrollment matters for Lansing. In the growth years, its student body provided a ready market for new downtown apartments, a customer base for the bars and restaurants that opened along Washington Square and East Michigan Avenue.
At is peak in 2006, Cooley had more than 2,900 students at its Lansing campus, but that number had dwindled as the other four campuses have grown and overall enrollment has fallen. By the fall of 2011, it was less than 1,800. Last fall, it was less than 1,300.
"I've heard from a variety of apartment owners downtown that there has been some marginal impact on the availability of renters," said Bob Trezise, president and CEO of Lansing Economic Area Partnership Inc.
He insisted the effect wasn't significant, that a drop in the number of law students had been "for the most part evened out by the gains we've made in other development."
"It's a piece of the pie, but just a piece," he said.
Cooley might be Western Michigan University Thomas M. Cooley Law School before the year is out. The two schools have agreed to a formal alliance, though they will remain separate institutions. The agreement only needs the approval of their respective accrediting agencies.
Cooley's leaders have understood the power of a name since Thomas Brennan, the former Michigan Supreme Court justice and who founded the school, sent a list of law schools to more than 100 fellow attorneys in the early 1990s and asked them to respond with a ranking. Penn State came in around the middle of the pack - but didn't have a law school at the time.
LeDuc made specific mention of work by William Henderson, a law professor at Indiana University's Maurer School of Law, on the academic reputation scores that U.S. News & World Report compiles as part of its law school ranking process. Those scores are generally intractable, Henderson found. Changing a school's name is one of the few factors that has led to any significant change.
Michigan State University's College of Law is the prime example, having seen its U.S. News rankings skyrocket since it stopped being the Detroit College of Law in 2004, though there are certainly factors besides the name change.
In the final analysis, LeDuc said, the potential of a new name to chance perceptions of Cooley wasn't the decisive factor in the decision to affiliate.
"But it would be nice," he said, "if it had that impact."
Lansing State Journal