18 August 2006

An Insider's View of the Legal Profession in Singapore

Ah, the dynamics. Once upon a time, and not really all that long ago, the government decided that Singapore had an oversupply of lawyers. A series of big changes were then made to deal decisively with this problem.

NUS (Singapore's only law school) progressively reduced its student intake each year, shrinking downwards to about 150 at its lowest point (and incidentally being more elitist than ever before).

The Supreme Court shrunk its list of approved foreign universities whose law degrees would be recognised in Singapore. This sharply reduced options for Singaporeans who hoped to go overseas to get a law degree.

Rules were amended to raise the bar for practising lawyers. New law graduates from NUS had to have at least a 2nd Lower to practise in Singapore. New law graduates from any of the approved foreign universities had to have at least a 2nd Upper.

Quite independently of these changes, two other big things were happening at the same time.

Firstly, Singapore set itself some very ambitious goals for its banking and financial industry. None other than Lee Hsien Loong himself was chosen to be the man to make this happen (he became Chairman of MAS). The banking sector opened up and foreign banks were given more room than ever before to operate in Singapore.

Secondly, ex-Chief Justice Yong Pung How launched some powerful plans to clear backlogs in courts' cases; speed up the litigation process; invest in technology and turn the Singapore courts into the most efficient court system in the world.

I believe that no one then really foresaw how all these seemingly separate initiatives were going to impact each other. But what happened subsequently is now well-known and obvious to those in the profession.

The supply of homegrown lawyers steadily shrank, even as the financial industry became larger and more sophisticated and its demand for legal services grew sharply. Lawyers, in terms of numbers, became a limiting factor for the industry's growth. In terms of expertise too, lawyers were a limiting factor - due to lack of numbers, they could not sufficiently specialise. Many had a broad understanding of the financial industry, but few had in-depth expertise in specific areas with the financial industry.

Meanwhile, in the courts, the pace of litigation sped up so much that lawyers couldn't cope. Calendars became fully crowded out (and it is physically impossible for a lawyer to appear in two courts at the same time). More than ever before, litigation lawyers had to work in teams, anything from 4 to 12 lawyers per case, and this led to the systematic deaths of the traditional one-man and two-man law firms. They would have hired more lawyers, but the supply of new lawyers was steadily shrinking.

Lawyers' salaries climbed sharply. But they had to work harder than ever before. In turn, working hours shot up fiercely and the attrition rate was extremely high. Many quit legal practice for a better quality of life, causing a vicious cycle of further shortage. You may have read in the media stories about how lawyers are not renewing their practising certificates anymore; how Chief Justice Chan Sek Keong is desperately encouraging young lawyers to come back to litigation; and how many lawyers quit high-paying jobs in law firms to sell secondhand cars; go into teaching; start bakeries; be actors and yoga teachers etc.

Some true stories of how hard lawyers have to work almost sound like the stuff of urban legend. Once upon a time, a pregnant partner, M, of a big law firm went into labour at the time when she was trying to close a big transaction. M instructed her secretary to get a laptop and meet her at the hospital. Later, while lying on the hospital bed and giving birth, M continued to type on her laptop until she could not type anymore - she then dictated notes (in between her moans and groans) to her secretary who did the typing for her. I cannot now remember which happened first - the birth of the baby, or the closure of the deal. But I know that the baby turned out ok.

In recent years, the Singapore government has begun to tacitly acknowledge its mistakes. It all seems to have started with Lee Kuan Yew's daughter publicly saying that the government has mishandled the supply of lawyers AND doctors. Since then, the government has been trying to reverse gear. These are the latest attempts:
Aug 17, 2006
New law school to raise supply of lawyers
SMU starts course next August; NUS to up intake; easing of rules for grads from foreign universities

By Ben Nadarajan & K.C. Vijayan

A SECOND law school will open at the Singapore Management University (SMU) next year, while the National University of Singapore (NUS) will increase its intake of law students, in an attempt to boost the number of lawyers in the country.

The new school will take in its first batch of about 90 students in August next year. At the same time, NUS' law faculty will also raise its annual enrolment from 220 to about 250 students.

The requirement for graduates from recognised foreign universities to practise here has also been lowered to a second-lower honours degree - although they will have to fulfil a host of stringent requirements.

Between 1997 and last year, about 300 law graduates were unable to practise because of the lower grade of their overseas degrees.

These recommendations were submitted to the Law Ministry last month by the third Committee on the Supply of Lawyers, which was headed by then Attorney-General Chan Sek Keong, who is now the Chief Justice.

The committee estimates that these changes will add 150 lawyers to the Bar each year from 2010 onwards.

Yesterday, Law Minister S. Jayakumar accepted the initiatives, saying they were necessary to bridge the widening gap between demand and supply plaguing the profession.

The number of lawyers has dipped slightly in recent years. There are now about 3,490 lawyers, compared with 3,537 in 2000.

Professor Jayakumar said there would be an increasing demand for lawyers in the next decade and the current crop was insufficient to meet this need ...
What's the moral of the story? The Singapore government DOES screw up big-time in its micro-management readings of the needs of the economy. Lawyers are one example. Other examples have been doctors (undersupply) and engineers (oversupply).

So if you are making your next career move based on the government's prediction of the next "hot" area or the next "dead" area, just be aware that the government has a record of getting things wrong. Life sciences and the biomedical industry is what comes to my mind. It may indeed be the next big boom. Or it may not.

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42 comments:

Kin Hou said...

Just last week, the doctor who attended to my flu problems told me how the intake of doctors reduced to just 140 a year during his batch. The rationale? Too many doctors will lead to expensive treatments like medical scans, etc. Of course the shortage led to new measures like opening up doctors to foreign doctors, a la Mah Bow Tan's proposal of bringing in immigrants to address the low birth rate. So is Singapore in a mess or what?

thor666 said...

Enlightening writeup.

I was brought up having the impression that Singapore's legal system is one of the best in the world, until I started taking legal related courses and reading up on alternative news later in life.

In my opinion, there is a fine thread that the government has to make between acknowledging its mistakes and losing power; the former is often a no-no by most accounts. I'm not sure, but I'm guessing our PAP government is one that perhaps have world class ranking when it comes to not apologizing (redefining/rethinking apologies not counted).

Tricky.

Anonymous said...

When Governments try to replicate Adam Smith's "invisible hand" they forget that the reason why the hand (i.e. demand and supply of a particular good/service) is invisible is because no-one is expected to micro-manage the factors to get demand = supply.

So a "visible hand" or govt active intervention in managing supply of laywers/doctors/what-is-the-next- target-for-micromanagement can work, or in some cases not...

Not too long ago a relative of mine, a doctor, applied and was granted early release from his bond with Govt because at that time too many. Now we are back to too few...

lunatic_fringe
"Do too many cooks spoil the broth or make it tastier?"

BL said...

It is already happening for our life sciences graduates. The problem is that they have specifically gotten all the students to take up life sciences, and then there is no demand from the MNCs to hire them. Part of the reason is the slowness in the unis to start courses on technology commercialization for biomedical sciences.

I have been planning my exit strategy given 10 years from now, there will be 1600 PhD holders in Singapore from A-STAR alone.

Anonymous said...

Mr Wang, you can draw parallel with the stop at 2 policy.

MercerMachine said...

my question is, are they going to let a PR like me practice once I have my degree?

singaporean said...

The real reason why professions like medicine and law are "gazetted" like Far Eastern Economic Review is political: Doctors and lawyers are seen as credible people, and lawyers are especially dangerous as opposition politicians because they are trained to be very articulate and legally savvy enough to push the legal boundaries safely.

They wanted to keep doctors and lawyers very busy earning money so they wouldnt even think about politics. I believe it had been very effective. How many new entrants to opposition politics are doctors and lawyers in the past 10 years? None that I can recall.

There is of course, a price to pay, but it will be borne out by the whole Singapore. This is just one example of our politicians putting their political needs above the needs of the country.

And on the government "spearheading" new hot areas like Life Sciences, Digital Media etc, do realise that when the government mobilises the educational system, every single polytechnic and university and private school will be churning out the exact same type of people en masse, while other agencies will be busy sucking in huge quantities of "foreign talent"; the end result WILL always be oversupply.

Just as over 50% of engineering graduates cannot find a job relevant to their course of study within just 1 or 2 years of government yelling "Desperate shortage of engineers!!!!!", the same will happen to other fields as well because of excessive government meddling. If you choose to dive into such popular fields, you better graduate in the top 10-20% or get ready for "retraining" to new "up and coming" skills as soon as you leave school. Oh and dont be choosy, a few hundred dollars is better than nothing.

If the government allows more freedom of choice in education instead of constant micromanagement, then we will have a ready pool of experts in every new hot area as they emerge. But I guess this is too much to ask for.

To justify their million dollar salaries, the government have to be omniscient, and act accordingly. How can they let Singaporeans stupidly choose their preferred route in life if, the government with their infinite wisdom, know FOR SURE what will the BEST for them?

Anonymous said...

i wonder when there will be a demand of any kind for pol science graduates?

i think we know a thing or two of how a ctry shouldnt be run...even after taking into a/c its geopolitical realities.

its this bloody spirit of anti-intellectualism dat the pap forments i tell u. no disrespect, but i suppose dats how you ensure you wont be challenged politically...u get the only pple who know ur talking cock to turn squares on wheel of fortune.

Anonymous said...

Part of the problem is that our political masters believe they are oracles when it comes to telling the future. In diplomatic parlance, it's called foresight and vision.

Another is that even when our senior civil servants know that something is amiss that will upset the long term trendline, they are too afraid to alert our political masters. Yes, sir is always easier than no, sir.

The third of course, as Mr Wang has pointed out, is that our policy makers, either don't like or have the skills of looking at the impacts of their policies in totality. One may know the simple direct impact (e.g. raise ERP gantry fees and rush hour traffic will improve) but it's often the indirect and side impacts that determine whether a policy is successful and sustainable. We're not in the habit of doing full cost-benefit analysis.

Lastly, everything that's uttered by our political masters is taken in by Singaporeans as gospel truth. We don't pause to think, "hey they could be wrong too you know".

One incident always come to my mind. I think it was 1999 at the NDP rally speech when former PM Goh Chok Tong gushed about the dot.com boom. He was talking about how easy for young people to become wealthy overnight by setting up dot coms. In other words, urging more Singapore students to take up computer science. I didn't see the relevance then but he also talked about a particular minister's daughter being hired before graduation by an investment bank.

Come 2000, the dot com bubble burst, and did it burst. Well, it's all water under the bridge now, but what's left is we have quite a few IT graduates who are unemployed or underemployed (or undercut by foreign IT workers).

Other examples of policies not turning out the way our political masters oracled:
- Stop at two (went on for too long)
- Graduate mothers' scheme
- Singapore as the preferred 'software' partner for China (Suzhou Industrial Park)
- Property asset enhancement (too much CPF tied up in one asset class-property, and not pricking the property bubble in the 90's early enough)

John Riemann Soong said...

Often the sheer blindness amazes me. Does it really take a decade to figure out that one is going too far with a certain campaign?

"The rationale? Too many doctors will lead to expensive treatments like medical scans, etc"

I know this is already seen as a weak rationale, but I must say that doesn't make any sense at all. More doctors mean more competition and lower prices.

Of course, there are things like competition to the point it develops into strife and gets destructive (a la Peter Kropotkin) ... but I don't think the rationale implicated that.

soulburnz said...

Hello Mr Wang,

What is your view regarding Paralegal Counsellors. And its relevancy to the local market taken into consideration that Temasek Polytechnic does cultivate people of such vocation?

moomooman said...

No one can really be 100% accurate in predicting the supply and demand. Even the government. It's the same for every industry and not related to the legal field.

Many years back, there was a shortage of engineers in the electrical and electronics sector, and intake for this goes up tremendously to cater to the demand of the industry. But later comes the industry meltdown and everyone in the sector couldn't find a job.

Likewise in the Biotech industry. Nursing industry. and many more.

This problem is alot more pronounced in legal and medicine.

You do not want to have a situation of having a supply first and wait for demand to come.

You always planned around shortage first.

boon said...

It's impossible for anyone to forecast the fast-changing job market. Does that mean that the Govt shouldn't at least try?

Or should it just wash its hands of it, and let market forces decide? At least the graduates have no one but themselves to blame for their choice of study. But with unemployment a growing problem in Singapore, it is understandably wary of letting loose.

On a related note, university freshmen are being asked to decide the course of their life when they're just 19-21 (17 for wannabe-doctors - you had to choose triple science in JC. I think the system has changed?). Do you really know what you want to be when you're still a teenager?

This is when career guidance and counselling can help. And spare them the PR talk about how wonderful, challenging and fulfilling the job is, but open their eyes to what it is really like doing it on a daily basis.

As for me, I chose a subject close to my heart. Though my current job is unrelated to my course, at least I thoroughly enjoyed my 4 years of study. Which is more than I can say for many engineers.

boon said...

moomooman:

there is still a shortage of nurses in Singapore. They've ramped up the intake in NYP, and imported more foreign nurses. But hospitals are still stretched. This situation is not unique to Singapore. Countries like UK are facing the same problem, it's a global phenomenon.

John Lim said...

I can't really say I thoroughly enjoyed my 4 years of study, since the engine course was so demanding. While my friends were busking in the company of females on the Bukit Timah campus, we were buried in the library and tutorial rooms. Upon graduation, I had 4 engineering job offers from Keppel Shipyard, SIA, SAE, and PSA. I took the PSA one to build container cranes and passed the SAE offer to my friend (servicing armoured vehicles). Since then, I had the opportunity to work with heavy construction equipment, fibreglass boats, automotive engineering, and process control equipment. Now I'm into marine seismic and data acquisition. Just to point out that engineering can be fun and helped to pay for my landed property and fifth new car. And still debt free.

Anonymous said...

Well, for those in the mid 20s to early 30s and affected by the govt's engineerings... tough luck to those lost sheep...

John Riemann Soong said...

Fifth new car??

Why don't you just buy a private plane instead?

Brother-in-law said...

I'm one of those who fled the profession while I could. 18 hour days, 6.5 days a week (if you're lucky), no public holidays and bad ventilation. All for a measly 3-6 month bonus (if you're lucky). Even after 5 years of "earning your dues". No thanks, I wanted a life.

Being an in-houser isn't much of an escape. The hours might be slightly better, but you are still expected to put in the time when you are required to.

Another factor that has not been considered. Singaporean lawyers are quite in demand elsewhere. Most of my peers are now doing what they do here, but drawing salaries in pound sterling in HK or London or US$ in NYC or SFO. And they enjoy the nicer standards of livings.

Singaporean firms are notorious inexpensive for the quality of work we produce. Are we not being paid our dues?

Anonymous said...

Boon

It's not really a question of saying that the government shouldn't at least try. The government uses taxpayers' money to invest in our educational infrastructure (and let's be honest, we have fantastic facilities) and it would want to allocate the money in the best way possible.

The danger I think is when our government pronouces this area is the next BIG thing, or that is the next BIG thing (and changing it ever so often). And then like lemmings, we get pulled along by all the wonderful talk.

Right now, the IN and BIG thing is of course biomedial science. Billions are poured into it. Career-assured scholarhsips are offered. Many students of course are attracted like bees to studying biomedical science, even if it is not their first choice.

And the government may turn out to be right. We could become the life sciences capital of Asia, producing companies like Novartis or GSK in the future. Or it could really get it wrong, outfoxed by other countries pursuing cheaper and more effective ways to grow their biomedical industry.

In the end, the fault ultimately lies with us. As you said, we should study what we are really interested in, not what is the next BIG thing.

singaporean said...

Recent studies have shown that experts are made, not born. You become an expert by spending time working in the field. That is why you should work in a field you genuinely love, because you will then willingly devote all your energy to learn all aspects of the field and be a true expert.

Conversely, if you force people into a field, they will be mentally fighting it all the way, and they will mentally switch off as soon as they can (after work, boss not around etc etc). They will never be experts, only mediocre technicians. And that is what Singapore is full of. Mediocre techicians, good enough to get the job done but not interested in making great stuff.

Although we like to believe that we have a government with great vision and foresight, and perhaps we did have a leadership with precisely those qualities, we have to acknowledge that most governments in the world are spectacularly lousy in planning. If central planning works well, then the Soviet Union should be running the world now. Except of course, the Soviet Union is dead. There are a variety of reason why governments suck, partly because government officials cannot possibly be expert in every facet of the country, and partly because, esp in totalitarian regimes, real experts of the field are afraid to mention opinion contrary to that of the powerful government officials.

Our government was once run by accidental ministers, people who know they know nothing about they do. Now we have ministers who think they are God's gift to mankind. Is it any wonder that their performance is having an inverse relationship with their pay?

On another note, if we benchmark Singapore with the Soviet Union, their 41st year of existence will roughly be 1960. You know, the era when they beat the Americans to launch the first man in space, the era when most Americans believe that they will lose in any war, including an economic one, against the USSR, the era when the USSR was at the peak of their achievements.

And then it was downhill all the way.

Anonymous said...

Very interesting observations, Singaporean ... I have to say though that for most people (in Singapore or elsewhere), identifying what you really love isn't such a straightforward exercise ...

Anonymous said...

Question: Why are the practising requirements for foreign law grads higher than those for local law grads?

Jason said...

There are some questions that trouble me about the account.

* Lawyers' salaries *
---------------------
Mr Wang mentioned that salaries were rising, but so were work hours. What does that mean for hourly salaries?

Note that the restriction on foreigners is in the form of a tariff-like measure (must have 2nd upper) rather than a quota-like measure (200 only). In that case, even though the domestic supply is capped by NUS Law, the wage rate is still free to go up to clear the market, by attracting more foreigners.

Is there some other source of competition that is actually constraining per-hour wages? Or some form of wage rigidity that is constraining wage growth?

Would love to hear more about the inner workings of this profession :)
------------
* Or lets assume there is some quota-like restriction on foreign lawyer entry *
------------
What then is to stop a group of partners from deciding they don't want to work 18 hour days? Wages are higher, so they can opt to take fewer cases and earn the same money anyway.



* signals for planning *
There is also the mystery of how the government actually plans out the NUS law intakes, and policies regarding foreign law graduates.

What is it exactly that they consider? Who's involved? How did these people miss, if Mr Wang's account is correct? Do they learn from mistakes?

There are plenty of signals that can be collected from the market. The most obvious one is, once again, lawyers' wages. Why haven't these been used adequately, if Mr Wang's account is correct?

Wylie Hawkeye Wilde said...

Hooray! Another brilliant idea by our infalliable leaders- the same people you brought you the two or one child policy, the dual language education system, etc...

Anonymous said...

My observation on the Singapore legal profession is this - the ones at the top of the professions have tunnel vision and are so keen to keep their monopoly (and big fat profits) that they squeeze fees and wages to make maximum profits.

Meanwhile the lawyers at the bottom suffer long hours and low pay and the attrition problem worsens. Yet the partners continue to squeeze the remaining staff even harder and continue to take on yet more clients and yet more work. The only thing these partners entice the remaining staff with is the "promise" of partnership - conveniently forgetting that for many of these young lawyers, they couldn't care less for partnership (or perhaps the partners simply don't care or even delude themselves into thinking that these young lawyers crave partnership?). And so the vicious cycle continues.

I agree that Singaporean lawyers are sought afer - their reputation amongst international law firms in the four main traditional financial centres (New York, London, Hong Kong and Tokyo) is that they have the technical and language skills and are known to be efficient hard workers whilst not being too overtly ambitious.

However, Singapore will never be able to compete with other Asian financial centres for legal talent as long as it keeps its profession artificially closed to outside competition. Clearly the joint vetures are a failure, competition must be on an equal and fair basis. Why should a foreign law firm and foreign lawyers bother with Singapore when HK is only a hop step away (with higher fees, higher salaries and close proximity to the mainland), Tokyo beckons with its mystical aura (combined again with higher fees, even higher salaries and the opportunity to travel throughout Japan), and upstarts like Bangkok and Shanghai just round the corner (catching up as financial centres and often attracting those with a sense of adventure).

So my advice to young lawyers would be - try to work abroad for a period of time if you can. Taking the path less travelled really helps to open your horizons to possibilities and helps get rid of this parochial attitude that Singaporeans tend to adopt to many things in life.

Just my two cents' worth.

hugewhaleshark said...

Don't you all see the connection to LKY's view of the law profession? The man obviously did not think much of the profession.

Interestingly, he also says that "The NUS law faculty has developed to the extent that the top three to five per cent of its graduates are equal to their international counterparts." Only the top 3-5% match up. Not too flattering!

lee hsien tau said...
This comment has been removed by a blog administrator.
lee hsien tau said...
This comment has been removed by a blog administrator.
Porcorosso said...

here's a little morality tale: once there was a young lawyer who after graduating from NUS went and worked for a big law firm in Singapore. An international law firm in HK offered better work and also double his money so he went. Then a big bad bank offered him even more money, better work plus shorter hours and again he went. The only economic or professional reason that he will ever come back to Singapore to work is if he is offered even more money to do fewer hours of better work. And he isn't even Singaporean, he's Malaysian. Does this upset me? Absolutely not - the boy played the system, the boy done good. Power to the boy. Ante up.

Anonymous said...

dammit, post the link and not the voluminous article!

medstudent said...

From the 30 comments above me, the common theme is that our Millonaire Ministers screwed up.

Personally, I think our Ministers are a lucky lot. For starters, the SG media is very PAP-friendly and that has made their job much easier.

Speaking to friends who worked in the Civil Service, I am constantly regaled by tales of policies bungling by the people in power. But the question is: Are we overcritical? Perhaps, but i think the public has never been afforded the transparency to scrutinize the Govt and the media has not helped much either.

I feel that our PAP ministers are too often hampered by LKY & his clique in the Govt who is a tad out of sync with current trends, despite whatever they say in public. Their conservative approach has suited us in the past but i fear that it will become irrelevent in the coming years.

From the Casino/IR issue, we can deduce that the PAP is well aware of the challenges that Singapore faces. In this aspect, it seems that the PAP is akin to Toyato(The car company) who is renowned for its ability to be a 'fast-follower of trends' but never known to be an active lead Definer of new innovative trends.

Hence, i seems that we pay them Million dollar checks to curb property speculation 6 months before the market crashed in July 1997. Alas, can we undo the bubble that has developed from 1993-1996 ??

In any case, back to the issue on Laywers and Doctors, I am very inclined to believe that they knew for some time (as early as 1992) that there will be a shortage. The real question is why did they drag their feet and instead choose to deepen the crisis rather than to nip it in the bud?? Is there a secret powerful lobby that wants to protect the high salaries enjoyed by the Drs & Lawyers? Or am i simply deluding myself with conspiracy theories?

It is high time for the Govt to say it loud in public what everyone wants to know.

MercerMachine said...

medstudent- it's called 'face'

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