1 in 4 Court Reporting Companies May Be Unprofitable

In my Collective Power of Stenographers post, we explored how court reporters collectively out-earn every company in business today. In Aggressive Marketing — Growth or Flailing, we took a look at VIQ Solutions, parent of Net Transcripts, and saw how a transcription company could be making millions in revenue but be unprofitable. This all set me down a path of learning about zombie companies, companies that are not making enough to meet debt obligations, or just barely enough to make interest payments. You can watch Kerry Grinkmeyer describe how that happens here. This isn’t very rare. A Bloomberg analysis of 3,000 publicly-traded companies found one in five were zombies. The main takeaway? Companies can make lots of money and still be taking losses.

I had the pleasure of looking through the Kentley Insights June 2019 Court Reporting and Stenotype Services market research report. I do want to be upfront about it: I have some reservations about the methodologies and some of the reporting. Very much like the Ducker Report, as best I can tell, it’s based off a sampling of respondents from in or around the field. There are parts of the report that are arguably a little incomplete or unclear. For example, being industry experts, we all know the vast majority of the work is done by independent contractors. Independent contractor isn’t a term that appears in the report. Unsurprisingly, when we reach the job pay bands and employment section, it says there isn’t detailed data on the industry and compares us to the telephone call centers industry. So this report is not a must-have for court reporters, but it does have some interesting insights.

Those remarks aside, when we get to the profitability section of the report, we get to see something pretty striking. Based on their data, more than 1 in 4 court reporting companies are not profitable. Average net income as a percent of revenue for the ones that are profitable? About 9.3 percent. For the ones that are not profitable, a loss of about 9.6 percent. And a pretty chart that says as much.

I never want to see the term capital benchmarks again.

On the following page, there’s a forecast for operating expenses and industry revenue. That’s summed up in another pretty chart.

This was pre-pandemic, by the way.

If we look at the trends here, it’s pretty clear that the forecast is for expense growth to eclipse and outpace revenue growth. If that keeps up, the unprofitable companies are going to be looking at bigger losses year after year. Given all the information I have today, I surmise that the smaller court reporting companies are the more profitable ones and the bigger ones are the ones struggling. There are sure to be some outliers, like small court reporting shops that go bankrupt and leave their independent contractors unpaid. But overall, the smaller companies can’t afford to remain unprofitable for very long, so it’s probably the “big dogs” eating that 10 percent loss. If I’m right, that may also mean the push to go digital is the dying breath of companies that can’t figure out any other way forward. In February, I wrote “…we only lose if we do not compete.” That is becoming more evident with time and data. It is a great time for the stenographic reporter to open up shop and be a part of the 74%.

Speaking of data, if everybody that read this blog donated $1.50, we’d have enough money to stay ad-free for the next two decades. To all donors we’ve had to date, thank you so much, put your wallets away. To everybody else, check out this cool song from M.I.A. about taking your money.

List of New York Agencies

Some will remember that in 2019 I put together a list of associations that offer mentoring. I now took the time to create a list of New York court reporting agencies and their office locations. Generally I erred on the side of inclusivity and pulled names and numbers mindlessly off Google. Please feel free to let me know about more firms that have New York coverage. I envision this as a resource for students and working reporters. Back when I was in school, we tended to gravitate towards a very limited selection of agencies, and it was probably to the detriment of some of us. Here’s the list. It’s available to share or download. You cannot edit my master copy, but you can edit any copy you create.

I put aside my personal feelings and included anything that came up as advertising court reporting services. Some entries on there are not stenographic-reporter friendly. Hope springs eternal that they’ll change their tune and embrace the unmatchable efficiency of stenographic reporting. Great example, stenographic reporting could probably bring up Cutting Edge Deposition’s rating from 1 star to 5. Our stenographic reporters across the state are going to be competing directly with the businesses that don’t use steno, and this is really a golden chance for those businesses to turn things around. Regardless of how that goes, let this stand as a reminder to students how valuable your skills really are. There would not be over 200 offices for over 150 businesses across the state if there was not money there. The vast majority of these are stenographic reporting agencies or utilize primarily stenographic reporters. Hone your skills and get ready for a bright future not only in the courts, but in freelance and the private sector.

Also a tip for students, if someone says they can’t afford XYZ but they have 9 different offices, they might be pulling your leg.

Interesting trivia, Southern District Reporters is actually a corporation for the officials of the United States District Court, Southern District of New York. Last I checked, you need Eclipse to work there. I’ve heard great things.

The Ultimate Guide To Officialship (NY)

This one is for the people whose dream job is officialship or becoming an official court reporter. Just to get some quick links out of the way, there are two major Facebook discussion boards that I’m aware of. There’s the Officialship Job Board and the NCRA Officials group. I’m going to talk primarily about New York State Unified Court System officialship here, so if you’re looking for federal employment, please check out and bookmark the federal judicary jobs page. You’ll likely need your RPR for federal employment. As a matter of fact, if you’re looking for employment in New York City generally, you should check out one of my very first posts, Get A Real Job. Just keep in mind that if your dream job is Southern District NY, you’re going to need Eclipse last time I checked.

I’ll be writing most of this from memory, so feel free to correct me if I am factually wrong anywhere. This is not, in any way, a “guide” that is endorsed or published by the New York State Unified Court System (NYSUCS). I am not writing as an employee of NYSUCS. This is me as an individual just retelling my hiring experience in “guide format.” If you get a job with NYSUCS, you listen to your boss or your union over anything you might read or interpret here. If you’re looking for official information about NYSUCS, you should go to the site and ask that question through official channels.

The Tests, Classifications, and Eligible Lists:

Before we go anywhere, let’s just address how you get a court job. There are rarely per diem assignments available. These are court reporters that are hired and paid per day to come in and take the record. Per diems are rarely sought as of writing. Then there are what we refer to as provisional postings and then there are permanent positions. Provisional postings go up whenever there is a spot that needs to be filled and can be found by going to NY courts current opportunities. You can also search for “NY courts careers.” Civil service examinations are posted at “NY courts exams.” Reporters that apply for a provisional position usually must pass an in-house test. The court system may waive the provisional test for NYSCRA or NCRA certified court reporters. Reporters looking for a permanent appointment must pass the civil service test. That test is never waived. By law, civil service tests must be given every one to four years. Provisional employees can be considered temporary in your mind. If a civil service test is given and a provisional employee does not pass it, they may be let go. Provisional appointment should not be underestimated though, since an employee begins to accrue vacation time, sick time, time in the title for raises, and pension time. Many reporters begin their career by obtaining provisional employment and then passing the civil service exam to become permanent employees.

There is a separate civil service test for court reporters and senior court reporters, but they are substantially similar. “The test” consists of a multiple choice written knowledge portion and a skills portion. The written knowledge portion focuses on grammar, spelling, and technical knowledge. The skills test consists of an opening statement, a jury charge, and a four-voice dictation. The dictation is in the ballpark of 200 WPM. Two of the skills tests are transcribed and one is read back from the court reporter’s notes into a tape recorder. The readback portion is only graded for accuracy and not for inflection. If a reporter misreads their notes and corrects that misreading, the error is not counted against them. There is a readback time limit. Generally, court reporters have been expected to bring their own printers, stenotypes, pencils, and other equipment to the testing site. There has been discussion within the system about the possibility of online testing, but no civil service test has been given in that manner as of today. There are two eligible lists created when the civil service examination is graded. One list is a promotional list and one list is an open-competitive list. The promotional list is for anyone that held a court title prior to taking the test. The open-competitive list is for people who are not in the system that take the test. Everyone on the promotional list is scored above everyone on the open-competitive list. For example, let’s say that Mary Sue is a freelancer and scores a 100 on the open-competitive list for the senior court reporter title. John Doe is a court reporter working for the New York State Unified Court System and scores a 96 on the promotional list for the senior court reporter title. John Doe will be considered for a position as a senior court reporter before Mary Sue. When someone accepts a job with the New York State Unified Court System, typically they complete one year of probation. It is easier for the employer to discharge an employee during probation. In addition to provisional and permanent appointments, there are also contingent permanent appointments. Succinctly, every employee in the court system is a “line.” Sometimes there are situations where someone permanent is sick, injured, or not present. Contingent permanent people fill their line until the permanent employee returns, if they return. The most important thing to remember about the civil service examination is that when it is posted there is an orientation guide and accompanying materials posted to the exams page. Test takers must read and follow the orientation guide. Failure to follow the guide can result in an applicant’s disqualification.

Once you’re on the list, you get a preference letter asking you what courts you’re willing to work in. When I got that letter, my brilliant plan was to say I was willing to work in any court and then turn down canvass letters as needed. If you turn down canvass letters, you must make sure that you respond to the canvass letters and remain active on the eligible list. If you get put on inactive status on an eligible list, you can get skipped over for future canvass letters. In summary, fully read every official material you receive.

The Titles and Courts:

With the hard part out of the way, let’s talk titles. there are two major titles in the New York State Unified Court System. There are court reporters and there are senior court reporters. Senior court reporters typically cover Supreme Court. Court reporters typically cover what we refer to colloquially as “lower courts.” In the “lower courts,” of New York City most courthouses are supervised by a court reporter in charge or “CRIC.” These CRICs coordinate with a supervising court reporter and/or chief clerk when necessary. I am informed that in many courthouses, the CRIC title is obsolete and has been replaced with “county supervising court reporter.” The county supervising court reporters report to a “citywide supervising court reporter.” In Supreme Court, the courthouses are overseen by principal court reporters. The principal court reporters coordinate with chief clerks when necessary. Court jobs are all ranked with a judicial grade (JG) number, and that number links to your pay. Court reporters are JG-24. Senior court reporters are JG-27. The Supreme Court of the State of New York is our state’s highest trial court. It deals with the adjudication of felony criminal cases and civil cases with damages over $25,000. Then there are the “lower” courts. In New York City, we have criminal courts that handle criminal arraignments, violations, and misdemeanors. We have civil courts that handle cases under $25,001 in damage. We have family courts where people can file petitions for family matters, including the issuance of orders of protection. A court structure chart is also available. Do not be fooled by the terminology “lower courts.” All of the matters where court reporters and senior court reporters are assigned are extremely important, as are both titles.

The Unions:

In New York City, if you work in the “lower courts,” or grand jury, you are represented in the Local 1070 union. If you work in the Supreme Court, you are represented by ASSCR. Local 1070 is comprised of a number of different titles. Every title has its own chapter leadership, and the chapter leadership works with the main leadership to solve problems. In Local 1070, the chapter leaders generally perform union steward duties when directed by the president or vice president, or whenever necessary. In ASSCR, there are the officers and the executive committee. The officers can be thought of as the decision-making body of the union and the ones who carry out any union-steward-type duties. The executive committee typically assists the officers by keeping apprised of union news. The way one runs for a union office is decided by the organization’s constitution and bylaws. For example, in ASSCR, a nominating committee is formed and nominates a slate. If someone that wants to run is not nominated by the nominating committee, then they have to follow the constitution and bylaws. Generally court reporters and senior court reporters that do not work in New York City are represented by CSEA, a massive conglomerate of titles, workers, and workplaces. My experience with and knowledge of CSEA is too limited to write about its organizational structure. The most important thing to understand about a union is that it negotiates your employment contract for you. If there is something you want in your workplace, you need to let union leadership know. Employment contracts cover a vast number of topics including vacation time, sick time, disciplinary procedures, grievance procedures, employee standards and employer obligations. Raises, increments, and longevity pay are all things that are addressed through your union as well. There are two more important things about union membership. First, your union has a duty to represent every member equally. Second, you generally cannot refuse lawful orders unless compliance would lead to imminent life-threatening danger. Insubordination can cause you disciplinary problems up to and including termination. If you are being questioned by a supervisor, you have Weingarten Rights. You have the right to have a union representative present if a conversation with your employer can adversely impact your employment or working conditions in any way. The employer usually has zero obligation to inform you of these rights, and you must assert them.

The Job:

A lot of stuff is on-the-job training. There are a lot of court-specific quirks that wouldn’t make sense to go into, such as night court and sealed criminal matters. Your first day on the job, you want to ask for common briefs and terms. In addition to our salary, when judges, lawyers, litigants, or members of the public ask for matters to be transcribed, we get transcript money as laid out in Part 108. Those terms, as far as I know, have been the same since 1999, so it’s a real lesson in the value of court reporters. A lot of transcription service firms jack up their rates every few years. By contrast, court reporters are consistent and reliable. We are responsible for maintaining equipment to take down our notes and produce and bind transcripts. We’re talking about a printer, ink, paper, computer, cables, stenotype, and transcript covers. Personally I am a big fan of pre-punched three-hole paper and A6 transcript covers. The drawback to using A6 covers is that you require different covers for differently-sized transcripts. Reporters that use standard transcript covers and separate fasteners do not have this problem.

There are a few things that are universally frowned on or just plain illegal. Stealing time? Bad. Stealing supplies? Bad. Being habitually late? Bad. Be on time and ready to work. Remember when switching over from freelance to employment that you have a boss now. If you have doubts about something, you should ask your boss for guidance. Coworkers can also be a big help. You’re an employee, and you are now covered by all of the employee rights laws, including the New York State Human Rights Law, the Civil Rights Act of 1964’s Title VII, Workers Compensation, and unemployment, et cetera. The most important thing about the job is not to take advice from some guy’s blog if it’s different from your court rules or boss’s instructions.

Interested in a career in the courts? Check out this NY Courts publication.

This concludes the “guide” portion of this post. If you’re interested in a really weird story about why I wrote this post, keep reading. If you don’t really care, feel free to stop reading.

The History of this Post:

Over the last few years I’ve had lots of people write me about various topics. Usually it’s well-meaning or polite people who have a grammar suggestion, topic suggestion, or information. I love those people. I even love the people who come on my blog and disagree with me. Separate from those people, starting maybe two or three years ago, someone sent me about 48 e-mails through an anonymous proxy. The e-mails were usually nonsensical, poorly written, or tried to turn me against other reporters. Sometimes they masqueraded as helpful advice or a hint at a story that didn’t exist. When the e-mail campaign failed to turn me against my best allies, this person began to infiltrate our Facebook groups under the fake name Jared Leno. Jared Leno proceeded to write rude comments to agencies that would come on our job boards to post jobs. At that point, I called him or her out on what they were doing and I alerted Facebook admins of groups where I was a member so that Jared could no longer use that fake identity to harass court reporters. Jared did what all bullies do when they lose, “he” whined and cried.

Jared/Anonymous then turned to Reddit. As some people know, we have the r/stenography subreddit, the r/courtreporting subreddit, and the r/courtreporters subreddit. The admins of r/stenography and r/courtreporting appear to be either absent or squatting, and at one point we had frequent posts from our Mystery Messenger (MM). One intrepid reporter started r/courtreporters so that we could have a space with an active admin, and we began to report the MM for harassment. “They” constantly create new accounts so that they can spread disinformation, avoid bans, and make comments about my blog. One of their favorite “jabs” is that I am an official and I write about freelance often. There are two main strategies when you’re dealing with trolls. The first is to ignore it. Sometimes this works. If someone is doing something to annoy you, and you don’t show that you’re annoyed, sometimes they go away. The problem we face here is that there are people that are going to Reddit to ask legitimate questions about our field. So if we just leave these boards a confusing, spammy mess, we’re going to leave the impression that this is a dead field or that we’re all lunatics spouting nonsensical drivel. Strategy two? Drown the spammy posts out with reality. So if you’re on Reddit, definitely subscribe to those channels. They’re a great way to get information out to the public. If you’re not on Reddit, it’s free, it’s generally anonymous, and it can be fun.

It’s been an interesting relationship. At first I believed that MM was a court reporter in pain. I tried many times to reach out and help. As time went on, I saw that it was much more likely to be someone who hates steno and someone whose IQ is high enough to use the internet but low enough that they have nothing better to do with their life than to get my blog clicks. Maybe it’s Steve Hubbard or Justin “Mr. Stenoless” Higgins. Who knows? All I know is MM is a great case study in being your own worst enemy. Their tirades have helped my blog grow its readership by almost 400% 2018 to 2019 and an additional 40% 2019 to 2020. Without MM’s unassailable genius I never could’ve come up with the work of art that is this blog post. If I could make one plea to MM, please do not find anything better to do with your time than follow me across the internet. Without your 1/31/21 post and unending struggle to get my attention, today would not have happened. Thank you for these wonderful years of service.

It was a tough decision on whether to publish this story. Some in my circle believe that talking about an anonymous “agitator” gives them more power. But perhaps knowing that this situation exists will help others identify MM by their inarticulate, artless writing as they continue to impersonate court reporters and spam court reporting groups. Perhaps others who have been e-mailed anonymously by this person will be able to identify that there is malicious intent there sooner than I was able to. I know at least one other person that received communications from MM. There’s bound to be more, right?

You literally asked for this. LOL. How about that?
Now all of this information will be easier for court reporters to find.

Collective Power of Stenographers

One piece of feedback I get back from time to time is “we can’t stand up to XYZ Corporation. They make 100 million in revenue!” I deeply empathize with this reaction because I’ve felt that before. Back in freelance, that feeling was constant. How could I negotiate with a company that was only offering $3.25? They were a big company with lots of work. I was basically a kid just out of college with my extremely shiny AOS. I didn’t even have a squid hat yet.

With this thing on, I became unstoppable.

But about 3 years ago I started to teach myself very basic computer programming. I began to learn a little bit more about numbers and math. I had always hated math, and the whole experience completely changed that perception. I started to like math. One the first programs I ever wrote was a simple counter program similar to this one:

This program loops for as long as steno is awesome, and steno never stops being awesome.

In this code, you start with the number 0 and it adds one forever until the computer malfunctions or the program is shut down. What you see happen very quickly is that when you’re adding one several times a second, one quickly becomes 10, 100, 1,000, 1,000,000.

What the hell does that have to do with stenographers? We are the ones that add up in this program called life. For example, let’s say we have XYZ Corporation and it makes $100 million a year in revenue. Now let’s say there are 23,000 reporters, like vTestify said almost three years ago, and let’s assume that reporters ONLY make a median salary of about $60,000 a year. Those reporters make $1.3 billion in revenue annually. You take two percent of that a year and throw it in an advertising pot, and you’re talking a $26 million annual advertising campaign.

5 percent? I said 2 percent. Someone should fix this immediately.

So now to bring this out of theory and into reality, you can see it happening in real life. There’s no group of people that’s going to have a 100 percent contribution rate. But when you look at the numbers, you start to see that overall we put far better funding into our organizations and activities than alternative methods or spinoffs. Take, for example, AAERT, which pulled in about $200,000 in 2018 revenue. For those that don’t know AAERT, they’re primarily engaged with supporting the record-and-transcribe method of capturing the spoken word. As I’ve covered in past blog posts and industry media, it’s an inefficient and undesirable method (page 5), and most digital reporters would do a lot better if they picked up steno.

Published by ProPublica

Then we can look towards the National Verbatim Reporters Association, which seems to focus more on voice writing, but definitely includes and accepts stenographic reporters. We see the 2017 revenue here come in at almost $250,000. Not bad at all.

As far as I’m concerned, every dollar is deserved. I’ve never heard a bad word from an NVRA member.

But then we look to our National Court Reporters Association, which is primarily engaged in promoting stenography and increasing the skill of stenographic court reporters. This is where we see the collective power of reporters start to add up in a big way. In 2018, the NCRA saw more than $5.7 million in revenue. The NCRF brought in an additional $368,000. That’s over $6 million down on steno that year.

I think I can see my membership dues somewhere in there.
When I pay off my massive personal debt, I’m going to become an NCRF Angel / Squid.

What conclusions can be drawn here? As much as the anti-steno crowd wants to say the profession’s dead, dying, or defunct, there’s just no evidence to support that. Here you get to see some fraction of every field contributing to nonprofits dedicated to education, training, and educating the public. We know from publicly-available information that our membership dues are not 30x more than these other organizations, so we know that there are a lot more of us, and we know that there are a lot more of us participating in continuing education and sharpening our skills. We’re the preferred method. We’re the superior method. We’re training harder every day to meet the needs of consumers. There are only a few ways this goes badly for stenography.

  1. We lack the organization or confidence to counter false messaging.
  2. We lose trust in our collective power and institutions, stop supporting them, and stop promoting ourselves. Kind of like the Pygmalion effect.
  3. We spend time tearing each other down instead of boosting each other’s stuff.

See the common theme? There’s really nothing external that’s going to hurt this field. It all comes down to our ability to adapt, organize, and play nice with each other. In the past, I equated it with medieval warfare and fiction. The easiest way to win any adversarial situation is to get the other side to give up and go home. It’s an old idea straight out of Sun Tzu’s Art of War. Applied to business, if you can convince people not to compete against you, you win by default. This might be in the form of a buyout. This might be in the form of convincing people that stenography is not a viable field so that there are not enough stenographers to meet demand. This might be in the form of would-be entrepreneurs believing they cannot compete and never starting a business. This might be in the form of convincing consumers that stenographic reporters are not available. This might be in the form of casting doubt on stenographic associations. This might be in the form of buying a steno training program and ostensibly scrubbing it out of existence. These are all actions to avoid competition, because as the numbers just showed you, we only lose if we do not compete. If you do nothing else for Court Reporting & Captioning Week 2021, please take the time to promote at least one positive thing about steno. If a guy in a squid hat could get you to think differently about just one topic today, what kind of potential do you have to make a difference in this world?

I’ll launch us off with an older quote from Marc Russo. “If you are a self-motivated person with a burning desire to improve your skills, this is the field.” This is our field. This is our skill. All we have left to do is stand up to the people that take advantage of our stellar customer service mentality and the public perception that we’re potted plants.

Can a potted plant do this?

PS. That $3.25 I was having trouble negotiating up from? Some of my friends were making $4.00+ with less experience than me. The limitation was me and the way that I was thinking about it. We have all had to deal with hurdles that seemed insurmountable. Max Curry talked a little bit about it in his NCRA Stenopalooza presentation “Fear…Let It Go!” when he talked about his father and introversion. It was an amazing presentation. But here’s my takeaway for those that missed it last year. If you’re having a problem, try looking at it another way.