Private Equity Holds the Key to Creating Quality Jobs for Millions

Report/Research

Private Equity Holds the Key to Creating Quality Jobs for Millions

January 9, 2024

At a Glance

“Private Equity Holds the Key to Creating Quality Jobs for Millions” makes the business case for why investments in talent at PE portfolio companies could catalyze improvements in job quality throughout the U.S. economy while at the same time delivering strong returns for investors. This road map for leaders in the PE sector identifies research-driven strategies that will drive this change and highlights trailblazing firms that are already making a tangible impact for workers.

“Five Ways to Help Private Equity Firms Create Quality Jobs” offers five concrete ways that policymakers, academics, nonprofit leaders, researchers, philanthropic funders, and others can help create the conditions that will enable private equity firms to succeed in efforts to promote the creation of quality jobs at the companies they invest in.

Click below to learn more.

Private Equity Holds the Key to Creating Quality Jobs for Millions Five Ways to Help Private Equity Firms Create Quality Jobs

Contributors

Megha Bansal Rizoli Senior Director   

Practices & Centers

Employer Mobilization

As leaders across the learn and work ecosystem engage in an increasingly robust national conversation about the need to pursue a cross-sector effort to increase the number of quality jobs in the U.S. economy, a new and potentially impactful ally has emerged: private equity firms.

Because the companies they own employ nearly 12 million people, private equity firms could have a significant impact on the push to create quality jobs if they pursue growth strategies that prioritize investing in talent. And their efforts could have ripple effects that benefit both workers and other businesses throughout the U.S. economy.

An Opportunity for Impact

More than other types of investors, private equity firms have a great deal of influence over the companies in their portfolios because of the terms of the deals that give them equity stakes in and ownership control of those companies.

In 2020, companies owned by private equity firms employed close to 12 million people in the United States (an increase of almost 3 million from 2018) and generated 6.5% of the country’s GDP—$1.4 trillion. Furthermore, PE firms can be critical catalysts of small and midsize business activity: In 2020, 86% of the companies they invested in employed 500 or fewer workers and about one-third employed 10 people or less.

It’s time to reposition private equity as an institution that can serve as a multiplier of impact in the emerging effort to improve job quality for millions of workers in this country.

The Time to Act Is Now

Private equity firms are well positioned to play an important role in the emerging effort to create more opportunities for U.S. workers to pursue quality jobs.

Any effort they make to improve pay, benefits, working conditions, and employee agency within their portfolio companies would surely have ripple effects that benefit more workers, more businesses, and more communities across the country.

The time to act is now.

To learn more about JFF’s work with Private Equity and how your organization can take next steps towards building a more equitable future, please contact Megha Bansal Rizoli at mbansalrizoli@jff.org.