Private equity stake in how it affects job openings ofenter
usinfo | 2014-06-09 15:36

According to two studies recently published show that in terms of long-term, private equity funds can help slow or prevent the loss of existing jobs, while promoting job openings for new business growth.

Commissioned by the World Economic Forum, Harvard Business School professor Josh Lerner led a 2008 study found that 5,000 pieces of acquisitions occurred in the past 25 years, is the former private equity acquisitions, reducing corporate jobs faster than the original business competitors about 1-3% higher. After the private equity fund shares or acquisition of these companies will reduce jobs initially, but the employment rate that is slightly higher than in the fourth year when the industry average. The survey also found that private equity funds took over the first two years, the company created new jobs will increase more than the industry average of 6%.

Private Equity Council (Private Equity Council) commissioned Professor Robert Shapiro and Professor Nam Pham Another study analyzed the 2002-2005 major U.S. private equity firm acquired large enterprises. It was found that these acquisitions have a positive and direct impact on the U.S. employment situation. 42 companies acquired a total of 26,214 new jobs, the equivalent of these companies were acquired 8.4% of the total number of employees 310,420. In the sample of companies, up to 76% of businesses increased jobs, only 24% of companies abolition of posts.

Provide U.S. jobs data 26 companies among private equity funds invest in companies in the United States increased by 13.3 percent of jobs (created a total of 13,861 new jobs), all the jobs U.S. companies for the period increased by approximately 5.5%, and large enterprises posts an increase of 2.7%. In the manufacturing industry, the company invests in private equity jobs increased by 1.4 percent, far better than the negative 7.7% in the U.S. manufacturing sector over the same period. Finally, Ernst & Young's 2007 study found that relatively sample enterprises in the private investment fund shareholders exit status when followed, 80% of the number of corporate positions remain the same or increase.

 

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