When a consortium of private equity firms decided it was time to form a lobbying and research organization three years ago, the research area at the top of their list was private equity's impact on the economy.
But data on the number of people employed by private equity portfolio companies in the U.S. was “not easily available,” said Robert Stewart, spokesman for the Washington-based Private Equity Council.
It took the council three years to find the right partner to obtain the data, Mr. Stewart said. That partner was PitchBook, a Seattle-based research firm.
Following a survey of 3,650 private equity-backed U.S. companies by PitchBook, and analysis of Hoovers Inc. data, the council applied algorithms and regression analysis to come up with an estimate of close to 11 million people working for private equity-backed firms. The private equity-backed companies that were actually reviewed, amounting to 39% of all U.S.-based private equity companies, currently employ about 6 million people, the report indicated.
Why did the council go to the trouble?
“We're trying to tell the truth about what private equity is and what it does,” Mr. Stewart said.
The report — thought to be the first to quantify private equity employment in the U.S. — does just that, he said. — Arleen Jacobius