I have blogged already today on the dangers of intervening too heavily in the market for LPC places, and now have some better data to show what has happened historically (courtesy of my colleague David Dixon, who has derived the data from the Law Society’s own figures). The picture is very interesting and can be seen in this table. The table shows the number of training contracts in the year following the year in which the LPC was passed (LPC passes only include those passing by October). Where there are more LPC passes in one year than training contracts passed in the following year (when those LPC students would take up their training contracts) then there is a negative ‘surplus’ of training contracts. This is the situation we find ourselves in currently. Where the number of training contracts exceeds the number of ‘first time’ passes in the previous year, there is a positive surplus of training contracts. The table shows this has occurred surprisingly often. I have included a (slightly hard to read) graph. Training contracts are in red. LPC passes in blue.
| Year | Pass LPC | New TCs | Surplus TCs |
| 93/94 |
4691 |
4170 |
-521 |
| 94/95 |
4755 |
4063 |
-692 |
| 95/96 |
4775 |
4739 |
-36 |
| 96/97 |
4338 |
4826 |
488 |
| 97/98 |
4460 |
4827 |
367 |
| 98/99 |
4627 |
5285 |
658 |
| 99/00 |
5007 |
5162 |
155 |
| 00/01 |
4990 |
5385 |
395 |
| 01/02 |
5467 |
5650 |
183 |
| 02/03 |
5721 |
5701 |
-20 |
| 03/04 |
6258 |
5732 |
-526 |
| 04/05 |
6558 |
5751 |
-807 |
| 05/06 |
6376 |
6012 |
-364 |
| 06/07 |
5921 |
6303 |
382 |
| 07/08 |
7606 |
5809 |
-1797 |
| 08/09 |
5824 |
4510 |
-1314 |
What is also surprising is the extended period during which the number of new training contracts exceeded the number of people passing the LPC by October of the year they sat it. Indeed, over the entire period until 2006/07 the totals passing the LPC by October were only 338 higher than the number of training contracts created between 1994/95 and 2007/08. For me that is a remarkably close match. The recent recession has dramatically reversed that position, but for how long?
A number of points flow from this. For extended periods, there were fewer LPC students graduating than there were training contracts. This suggests it is possible for the number of LPC passes to undershoot the number of training contracts, which means it was harder for the profession to get good recruits.
The table also shows signs that the number of LPC passes and training contracts both dropping down in response to the current recession. Importantly LPC applications and passes appear to be market sensitive. It will be very interesting to see what happens beyond this: will LPC passes drop faster than the drop in training contracts? If so we will find ourselves back to 1995 pretty quickly. It remains to be seen whether this in fact happens, but given the debate about LPC places the possibility needs to be kept in mind, at the very least.
This also leaves open the interesting question of who was filling these training contracts. Clearly some of the backlog of those not getting training contracts straight after the LPC was cleared. It should be re-emphasised also that these figures do not include students who passed after October (say after a number of resits): that is it does not include the (generally) weaker students. Presumably a number of these were also able to find training contacts. Overall, the data suggests the market is working generally pretty effectively. If anything, on seeing this I began to doubt whether over the last fifteen years there has been sufficient competition for training contracts (a heresy, maybe, but one which might be true up until 2007/08). Food for thought.
Lawyer Watch 
Really interesting. Strange also how rarely we hear calls for the market for BPTC places to be restricted.
An interesting and eye-opening analysis. The figure I don’t know is how many of those students who are referred go on to pass the LPC shortly afterwards. Does anyone have an idea? In 2009, for example, 22% of those taking the exam were referred; it was 13% in 2004 (I can’t be bothered to look through all the stats, sorry!). But potentially we could be talking about the kind of numbers that would have a significant impact on these statistics and undermine the argument.
And as you say, the problem can accumulate once you have one or two years of oversupply. As a new reporter on the Gazette in the mid-90s (and until shortly before then a trainee solicitor), I was given the training beat and recall attending TSG conferences (as must you, Richard) where I would meet students who had applied for literally hundreds of training contracts. Now they might not have been much good, of course, which gets us back into aptitude test territory. But I’ll stop there!
Thanks both.
Neil, I don’t know how many referred candidates then pass. I guess the import of that depends on how comfortable one is with the idea that (to generalise somewhat) competition for training contracts should effectively come from those who did not pass the LPC first time. And it is also worth restating that this situation arose even though the Law Society did not reduce the number of students who could take the LPC.
I absolutely remember the human cost of the 1990s. As you recall, I was Chair of the Trainee Solicitors’ Group and spent many hours talking to LPC grads who did not have training contracts. Indeed, a very close friend of mine failed the LSF (predecessor of the LPC). He lost his training contract as a result. He was devastated financially and felt humiliated into the bargain, but resat and passed the LSF. He decided not to seek another training contract and went off to work for Anderson Consulting instead. He earnt way more money than me (and many in the legal profession). Not all such stories have a happy ending of course.
I also believe one should be wary of the argument that a qualification entitles you to a job. Staffordshire Health Authority are facing up to that problem right now. In my own field, academics typically have to get a PhD, but I would surmise have a poorer chance of getting a lectureship or postdoc than LPC grads have of getting a training contract (and their average earnings would be lower if they succeeded).
LPC providers are required to provide the SRA with details of who has passed the LPC. Thus the SRA must have the data to enable them to calculate how many referred students pass the LPC and when they pass it, though whether they have the resources (or interest) in doing so is another matter.
There are less than 40 LPC providers but the SRA can’t find the time to go through the letters from the providers and record the number of passes from re-sits.
I undertook research for the TLS in about 93/94 looking at a national debate of Training Contracts. The idea would not work. However what stuck me then and this is reinforced by the analysis here is that too many students make too many poor applications. If they made fewer better applications they stand a better chance of having them considered by employers. Making a 100 applications, once multiplied across weaker applicants, simply results in firms binning bundles of applications which, largely, were unsolicited in the first place.
Aptitude test? Don’t get me started…
Yes, I’ve got lots of thoughts about aptitude tests too. If I get a bit more time anytime soon I iwll put them down and see if I can tempt you into replying…!
Not sure which idea will not work: the thin sandwich?