Recession reality check

Generally speaking, these are uncertain times and it's no surprise if economic issues and employment concerns are at the forefront of your mind. In this opinion piece, Katherine Gibson, chair of the Junior Lawyers Division, offers timely advice on what a recession may mean for students and trainees, and what may lie ahead.Law is a difficult profession to be in at the moment and, as the recent poll conducted by the Junior Lawyers Division (JLD) showed, approximately 80% of the profession is worried about redundancies. The reality is that the solicitors’ profession is not recession-proof and we are at the mercy of the economy as a whole. However, it is not only qualified solicitors who are feeling the effects of the credit crunch. Students and those looking for a training contract will also be finding life difficult.

There are several issues facing LPC students in the current climate. The first being the cost of completing the LPC itself, which has risen in the boom years and can top £10,000 in some cases. Add to this the cost of living in more expensive locations, such as London, Guildford and York, and students will certainly be feeling the pinch. Rent alone in London is likely to cost some £4,500 for the academic year period. Students are expected to concentrate on their studies for the entirety of the course, and not take up part-time employment. However, for the majority of students who do not have sponsorship from a law firm to complete the LPC, this is very difficult. Many work evenings and weekends while studying as they have no choice. This can make the year very stressful.

There is also the problem of finding a training contract in the first place, which will be difficult at a time when firms are debating whether to make reductions. One of the first responses to an economic downturn is to freeze hiring. This is no less apparent than in the training market. A trainee must be paid a minimum salary of £18,420 per year if they work in central London and £16,500 per year if they work anywhere else in England or Wales. Although the profession is realistic, and appreciates that if it reduces numbers of trainees now it may have a problem later on, some firms simply cannot afford to take on trainees. This is especially the case for those firms who are making redundancies. There are fewer training contracts available this year and competition for those places is fierce.

Even those who have managed to find the elusive contract are not immune from the downturn. Some firms are deferring the start of training contracts from 2009 to 2010, when it is hoped that the worst of the recession will have passed. Firms feel that they cannot support trainees at this time, but feel that they may be able to at some later point. These firms are trying to take a long-term view, hoping that the recession will blow over by the end of the year as some market analysts predict. These potential trainees may well decide that a year's delay is too much and they may also be back on the (already saturated) market.

It is important to note that some firms recognise that not hiring trainees now can cause problems in the future, when the markets pick up and they don't have the capacity to meet the demand for new business. Lessons learnt in previous difficult economic times (eg, the early Nineties) have proved instructive and some firms are taking the view that it is better to continue to recruit trainees and keep them on at qualification.

However, there is no quick fix to these problems. Until the economy picks up, there is not much the JLD, SRA or Law Society can do for its members, other than to highlight and let them know of these issues. 

The message we are trying to impart is that the market for training contracts is even harder and more competitive than it usually is. The usual issues of there being too many candidates for each training contract are magnified in a market where the number of contracts is reduced and desperation is increased. The worst development of this market downturn is that students are embarking on an expensive postgraduate course with the feeling that they will get a training contract at the end of it and start their legal careers. The reality is much starker. Those graduating may not find a contract immediately or even within a year and this can be financially and emotionally trying.

We are not imparting this information to try and dissuade you from a career in the law – far from it. It is your decision whether to undertake the LPC and to start on the long and difficult road to qualification. What we want is that you make this decision carefully and in possession of all the relevant facts. It remains the case that you will qualify if you are committed, hard-working and well-informed, but it will be challenging and disheartening, and you will suffer a few knocks and setbacks along the way. However, it is those who beat the odds and continue fighting on to qualify, even in the face of adversity, who make the best solicitors.

Katherine Gibson is chair of the JLD and an employment solicitor working in-house at Nortel. Contact the JLD via its website or [email protected].