Cooley Law School has shed three-quarters of its full-time faculty. It’s still losing money. And it’s not just the former number 2 nationally ranked law school feeling the pinch.
Professor Paul Campos has spent years chronicling law school financial shenanigans. In his new paper (which he flagged over at Lawyers, Guns & Money yesterday), Campos examines the finances of nearly every ABA-accredited law school and stacked them against where those same schools stood 16 years ago. The numbers suggest upwards of 40 percent in severe financial distress, with another 30 percent standing somewhere between wobbly and precarious.
Since “Peak Law School,” which Campos sets at 2010 when total JD tuition revenue and per-student JD tuition revenue both hit inflation-adjusted highs, aggregate JD tuition revenue is down 41 percent. Roughly 24 points of that decline comes from schools collecting less per student, with the rest attributable to there having been fewer law students to collect from.
Some of this is a byproduct of the reform movement that Campos and publications like Above the Law championed. At the peak, every diploma mill out there charged top dollar for students chasing a dream. Most of those students ended up unable to practice or practicing in jobs that barely kept up with their loan payments. Shining a light on less-than-scrupulous law schools managed to convince a generation of potential lawyers to be more savvy about their future and that tamped down enrollment.
But the problem is that revenue fell and law school cost structures didn’t.
The U.S. News rankings, an annual fixture since 1990, awarded points for spending money. They never really asked about spending money well. So schools pumped cash into faculty lines, facilities, and per-student expenditures bringing up rankings, on the hope that higher rankings would bring in more applicants or justify higher tuition or both. But there’s only so much room at the top and run this loop for three decades alongside generous federal loan programs, and you get an industry that quasi-bankrupted itself competing for placement in a magazine that has since stopped meaning much of anything.
As an alternative, schools could try to game a rival ranking that judges schools based on outcomes and cost, but that’s apparently too hard for them.
Eleven ABA law schools have closed in the past decade. In the previous half century, only one shut its doors.
Campos reports that UCLA’s tenured and tenure-track law faculty averaged $407,000 in 2024, a figure including chair stipends and summer research money. That is roughly double the average for tenured and tenure-track faculty across UCLA’s arts and sciences. The traditional justification is that law professors are all “temporarily embarrassed Skadden partners” who could pick up and move to an elite partnership if they wanted to.
Generally speaking, academia should pay faculty more and really stick it to the legion of “assistant dean of intramural basketweaving” administrative jobs that have cropped up over the last few decades. The people actually teaching the classes shouldn’t be routinely paid less than random admins. An economic study concluded that the proper ratio of faculty to administrators would be 3-to-1. The current average in the United States is 1-to-2. This is across the university, and doesn’t necessarily justify paying a law professor over $400K… but it’s just a reminder that the solution shouldn’t be slashing professor pay to nub before looking at some other glaring expenses.
But in any event, as bleak as the landscape appears, Campos sees darker times ahead. Because the numbers in his paper accrued while Grad PLUS existed. That ended July 1, with new professional-degree borrowers capped at $50,000 a year and $200,000 total. In other words, the world where nearly 70 percent of law schools face potentially disastrous financial pressure came under the most favorable financing conditions American legal education is going to see for a long time.
Applicants are up at the moment. More than 81,000 applicants for the 2026 cycle with applications up better than a third over two years. They can’t borrow what the last group borrowed, but they’re at least bringing bodies to the classrooms. Some schools have developed innovative workarounds, like Santa Clara guaranteeing every incoming student $16,000 so the remainder fits under the cap, or Stetson building a summer-start program to squeeze a class in under the old rules. But those are not long-term strategies.
Campos notes that the underlying pattern — institutions bankrupting themselves chasing a prestige metric that never meant anything — runs well beyond legal education, and he is right about that. Law schools just got there first because they had the purest version of the twisted incentive structure: one ranking that everybody agreed to care about, and an unlimited line of credit to chase it with.
Now that bill is coming due and “maybe the rest of the university will subsidize us paying ourselves more” is unlikely to be the winning long-term strategy that a lot of schools think it will.
Is Your Law School Going Broke: A Field Guide for Interested Parties [SSRN]
Earlier: Get Ready For U.S. News Law School Rankings To Make No Sense
Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter or Bluesky if you’re interested in law, politics, and a healthy dose of college sports news.
The post Law Schools Spent 30 Years Buying U.S. News Rankings And The Bill Just Came Due appeared first on Above the Law.