Professor Bainbridge compares an article from The
Economist showing
a steady increase in Americans’ leisure time over the past 40 years with
a story from the Chicago Daily Law Bulletin reporting on how
over-worked lawyers are:
"The survey showed that how much money a lawyer makes corresponds
almost exactly with how much work reduces family time. In the open-ended
responses, lawyers said over and over again that achieving a high level
of success in the profession simply demands putting in long hours."
To be sure, the Economist shows that less-educated workers have
made even greater strides in gaining additional leisure time than more-educated
workers:
But this doesn’t answer Bainbridge’s question:
"But if lawyers
can (and do) make more money by working more, why isn’t that equally
true of other professions whose practitioners seem to be enjoying more
leisure? And why hasn’t the market made available options for lawyers
who would be willing to take a cut in pay to work fewer hours?"
What’s going on here?
My hypothesis is that it’s the product of
the nasty intersection of the billable hour with increased productivity
elsewhere in the economy. This quote from The Economist piece
makes this point obliquely:
"There has been a revolution in the household economy. Appliances,
home delivery, the internet, 24-hour shopping, and more varied and
affordable domestic services have increased flexibility and freed up
people’s time."So women are devoting more hours to paying jobs, but have cut their
housework and other burdensome tasks by twice as much."
In other
words, assuming that
homes are just as clean, or just as dirty, as forty years ago, that
the refrigerators and laundry hampers of America are equally full or
empty, etc., the productivity of household-work has doubled.
Meanwhile, in the "for-pay" part of the economy, or what
the good economists who produced the study call work, productivity
of everyone from pharmacists to Wal-Mart clerks to FedEx drivers has
shot up tremendously–up 36%
since 1992,
so we can easily assume it’s doubled or even tripled since 1965. Most workers
have split the additional income created by their productivity gains
between increases in take-home pay and increases in leisure time—which
is simply another way of saying that the more you can earn per hour,
the more choice you have between working as hard or harder for more money
or working less for the same money.
But lawyers have (a) increased their hourly productivity far more
slowly than the average across the economy; and (b) remain all but
universally tied to the billable hour, which creates a tremendous correlation
between recorded hours worked and income. For example, apropos
the recent round of associate salary pay hikes at large firms in New
York and California, would anyone in their right mind hypothesize
that these firms will not expect equal or greater annual billable
totals for their largesse?
Add in the ever-increasing visibility of, and pressure to maximize,
profits-per-partner, and I’m not surprised lawyers are working harder.
From a micro-economic perspective, the only way a law firm can meaningfully
increase its profits, on a sustainable basis, is to increase revenue.
The costs of a law firm—almost entirely salaries plus benefits,
and office rent—are not, realistically, expense categories where
serious savings can be achieved.
So to increase revenue, firms can raise their hourly rates (which
they are doing, to be sure, but there are short-run limits to this
strategy), or increase the number of hours billed. If we
lived in the land of Alternative Fee Structures, there would be other
options, but we don’t so there aren’t. (Even in Alternative Fee
Land, I question how effective the other options would be: There
is as yet no way to materially increase the productivity of a lawyer
by adding in capital, as firms from Intel and Dell to FedEx and Wal-Mart
can do with their employees.)
Finally, there’s what I characterize as the "plasticity" of
what the actual day-to-day of providing legal services amounts to.
By "plasticity," I
mean that one can always do more: Research more case-law, comb
through the acquisition agreement one more time, review a witness’s
proposed testimony yet again, rework the opening paragraph of an appellate
brief, etc. By contrast, most tasks confronting other workers are finite:
Lunch is served, the house is framed out, the exam is graded, the prescription
is written.
This means that not only does the profit imperative demand more billable
hours, their supply is inexhaustible.
And as to why we don’t have Alternative Work/Life Balance Land, where
lawyers could trade, say 20% of their income for 20% of the hours they
work, we have, as Point of Law nicely puts
it, a "collective action
problem."
