The Atlantic:  How the Job Market for Law School Grads Crumbled (and How It Could Come Back to Life), by Jordan Weissmann:

Last week, it was reported that law school applications were on pace to hit a 30-year low, a dramatic turn of events that could leave campuses with about 24 percent fewer students than in 2010. Young adults, it seems, have fully absorbed the wretched state of the legal job market.   

And
hallelujah to that. The last thing the economy needs is thousands of
additional J.D.s sitting around with no work and $125,000 of grad-school
debt hovering over them.* But just as importantly, if the coming
correction is as big as some are predicting, there's a chance that the
hiring environment for new law school graduates could return to sanity
within the next few years. …

There was a time that graduating from
law school meant that you had a fairly sure shot of landing gainful
employment as an attorney. No longer. Since the recession, the fraction
of new J.D.s finding a full-time job requiring a state bar license
withered from roughly 74% down to less than 60%. …

But here's the key thing: while the
number of law grads without work more than doubled, the number that did
land jobs stayed relatively even — 37,123 in 2007 vs. 35,653 in 2011.
So why did unemployment grow so much? Because more people were
graduating law school in 2011 than four years earlier. And that brings
us to why there might be a little ray of hope for this year's law school
applicants. …

[J]ust 36,000 law students will graduate
in 2016, down from a full 44,495 in 2011. In short, the number of new
JDs would roughly match the number of jobs that were available to even
the unluckiest law school class in recent history. They wouldn't all
necessarily be very good jobs (again, consider the contract lawyer), but
they'd be jobs nonetheless. 

That's the math. Now about the need for optimism. Big law firms seem to have stabilized
themselves, but the calm might only be temporary. Their business model
is still in a fair amount of danger, under siege by innovative,
lower-cost companies that market basic corporate legal services on the
cheap as well as technology that threatens to undercut the need for
associates, and along with them an important source of profits. As firms
struggle their way towards sustainable growth, some may well cut down
their hiring even further. And if they do, the effects will be felt all
over the legal job market, just as they have been for the past couple
years. Call it trickle down unemployment.   

So here's the deal, class of 2016: You're okay if law firms stop shrinking. You might not be okay if they don't.