The work forces of companies acquired in 42 of the largest successful private equity transactions worldwide grew 76% since the deals were made, according to a new study sponsored by the industry trade group Private Equity Council.
Employment increased 13.3% at the 26 U.S. companies that provided three years of data, compared to an overall U.S. work force increase of 5.5% between 2002 and 2007. The seven manufacturing U.S. firms lost 1.2% of domestic jobs in the first year, lost 3.8% in the second year and gained 9.8% in the third year. Employment at 19 non-manufacturing companies grew 1.9% in the first year following the private equity transaction, grew 5.2% in the second year and fell 2.3% in the third year.
The study conducted by Robert Shapiro, chairman of economic advisory firm Sonecon and a former adviser to President Clinton, and Nam Pham, founder of market research firm NDP Group asked private equity firms to submit data on transactions valued at more than $250 million between 2002 and 2005, said Joe Caruso, Private Equity Council spokesman. Of the 70 transactions submitted, 42 were still owned by the private equity firms and had employment data for the date of acquisition and at least one year following the takeover.