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The consequences of private equity acquisitions for employees: new evidence on the impact on wages, employment and productivity

Goergen, Marc, O'Sullivan, Noel and Wood, Geoffrey 2014. The consequences of private equity acquisitions for employees: new evidence on the impact on wages, employment and productivity. Human Resource Management Journal 24 (2) , pp. 145-158. 10.1111/1748-8583.12032

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Abstract

There is growing controversy on the HR consequences of private equity acquisitions, especially when the existing management team is replaced. Much of the debate thus far has centred on the use of limited panels of case studies and industry surveys. This article, in contrast, uses both in-depth interviews with relevant stakeholders and objective company data to compare firms subject to private equity acquisitions against a control group of non-acquired firms. Our interviews provide insights into key issues that are investigated in the subsequent empirical analysis. Our core findings are that firms subject to a specific type of private equity acquisition – institutional buyouts – are associated with job losses, lower wages and lower productivity. This evidence is consistent with the notion that this type of private equity acquisition has negative employment consequences without any corresponding improvement in productivity.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Additional Information: Published online before print January 2014.
Publisher: John Wiley & Sons
ISSN: 0954-5395
Funders: Nuffield Foundation
Date of First Compliant Deposit: 30 March 2016
Last Modified: 27 Jun 2019 18:02
URI: http://orca.cf.ac.uk/id/eprint/55231

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