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Law school economics changing the reality for legal hopefuls

With fewer job prospects available after graduation—and mountains of student debt accumulated in the pursuit of their degrees—some would-be attorneys may wonder if law school is worth it.

Recent reports have been discouraging. According to a study by Ohio State law professor Deborah Jones Merritt, 20 percent of law school graduates from the class of 2010 are working in jobs that do not require a law license.

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However, David Lat, who once practiced law and is now the founder and managing editor of the law blog AboveTheLaw.com, believes things are getting better.

"Law schools are actually reforming and improving. They've been slimming down," he said in a recent interview with CNBC's "Power Lunch." He added: "They've been introducing reforms to their curricula and as a result the job prospects for people who are graduating law school today are a lot better than the class of 2010."

Prior to the 2008 financial crisis, a law degree was seen by many as a ticket to wealth and repayment of education costs. The recovery, however, has disabused people of certain assumptions about a legal education.

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"Choosing to attend law school is a big decision that prospective law students should not take lightly. Although many factors may influence one's decisions about whether and where to attend law school, a proper understanding of the economic cost of a legal education is vital for making an educated decision," the American Bar Association said in a report on its website about the value of a law degree.

"Far too many law students expect that earning a law degree will solve their financial problems for life. In reality, however, attending law school can become a financial burden for law students who fail to consider carefully the financial implications of their decision," the organization added.

Law school student
Tanya Constantine | Blend Images | Getty Images

Still, data compiled by the ABA show a slight increase in the percentage of 2014 graduates obtaining entry-level jobs compared to 2013 grads.

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Ten months after graduation, 71 percent were employed in long-term, full-time positions where a bar passage was required or a law degree was preferred, the data showed. In 2013, 67 percent were employed in those jobs nine months after graduation.

However, that increase is apparently due to the fact that there were fewer graduates in the 2014 class. The number of jobs actually declined, in line with anecdotal evidence suggesting elite law firms have been slower to hire freshly minted lawyers.

"We're not creating more real lawyer jobs; we're just decreasing the supply of would-be lawyers," said Elie Mystal, who practiced law before writing for AboveTheLaw.com. "That's OK, but not a good reason to rush back into law school."

Lat also wouldn't advise rushing to law school, but said it could be the right decision for some.

"For people who have done their homework and have a good reason for going it's not a terrible time." he said.

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While some may argue the world doesn't need more lawyers, Mystal disagrees. Even though the cost of a three-year degree is daunting, which at some of the top tier schools can far exceed $100,000, Mystal says there is still a need for more attorneys.

"There are a lot of underserved people who do need legal help," he said. "The problem is that if you are coming out of law school with $150,000 of debt, it's hard to serve an underserved community."

To help remedy the disparity, he believes tuition should be drastically cut.

"The tuition of law school has been the only thing that's recession proof. It's gone up when all the other indicators have gone down," he said. "If you want to have more lawyers to service the people who need it most, you have to start bringing the price down."