The stock market has gone up and down, but for decades at Harvard Law School, one thing has remained the same: job security.

“As a Harvard student, you feel entitled to get a job, and you ignore these dire reports on CNN,” one student told the Crimson in February after the Harvard Law School’s peak recruiting season had passed her by and left her without a job. “You think that things will work out like every other year.”

During the current recession corporate law firms—like a majority of other industries—have pared down their operations after transactional assignments in investment banking and trading evaporated in the heat of the downturn.

Top performers from the nation’s most elite law school are now faced with slashed salaries, lay-offs and reduced hiring. The pre-crash ideal of fast-cash has been swept away by the brusque hand of the last two years of financial uncertainty.

In economic downturns, law firms have come to expect litigation activity to increase even while transactions decrease in a recession. But the magnitude of this recession—the worst since the Great Depression—has nullified this conventional wisdom, leaving firms scrambling to cope.

The fall-out has accelerated a reform process within firms to improve the way that they hire, recruit, and operate.

This year, Harvard Law School has seen a 20 percent reduction in the number of firms participating in its recruitment process, according to Mark A. Weber, assistant dean for career services at the Law School. Some members of the class of 2009 received deferred start-dates as firms struggled to keep the hiring commitments they made two years earlier. And starting salaries for the largest firms have dropped from around $160,000 to $140,000.

Administrators and experts at the Law School have hinted at the possibility of pushing back the start date of the fall recruiting season. But starting this spring, the Law School will host a second recruitment period for “firms whose hiring outlooks have changed,” in anticipation of an economic recovery.

‘OVERHANG’

Jason C. Murray, a second-year student at the Law School flew from Cambridge to Washington, DC two weeks ago for what is commonly referred to as “fly out week,” an intense week long, class-free period of job interviews and elbow rubbing with potential employers.

Murray is one of the few still falling snugly into the mold that has characterized the recruiting process for decades earlier. Just one semester into his first year, Murray entered into the competitive process of applying and interviewing for summer internships.

The next fall, the job hunt began in earnest. Murray landed three interviews in Washington and three summer job offers that would likely result in a full time offer.

But Murray’s success is emblematic of a fundamental problem with this recruitment system, some critics say. The two-year lag between when firms extend job offers and when employees begin their first year forces firms to predict associate demand far in advance of the start date and leads to inaccurate predictions of hiring needs.

According to Weber, the backlog of entry-level associates or “overhang” is negatively impacting firm demand for associates in this recruiting cycle.

After the financial crisis pummelled investment banks and the fountain of transactional work dried up, law firms were forced to keep the commitments they made to new hires two years earlier. The result: a spate of deferred start dates that began with the class of 2009 and may continue with the class of 2010.