Investment in small firms appears to be driving job creation, with over three quarters of private equity chiefs reporting personnel increases within their investee companies, according to a new survey.
The study of 75 UK private equity heads, commissioned by industry magazine unquote”, also found that the majority of investors expected these numbers to grow, with 67% expecting hirings to continue throughout 2013.
The survey comes amid a reported drop in UK unemployment figures, with the latest estimates at around 2.56m – although analysts have reported this drop is largely attributable to the influx of temporary jobs created by the Olympic Games.
Editor of unquote”, Kimberley Romaine, commented: “Private equity has been in the firing line for cutting jobs. However our research highlights with private equity backing, many small and mid-market businesses are achieving substantial growth and as a result play a key role in strengthening the UK economy.
The objective of private equity is to create a company that is stronger, more profitable and more efficient than the company was prior to purchase. Private equity accelerates the pace of acquisitions, as well as organic growth, which in turn acts as a catalyst for job creation. Our research proves this point and these small to mid-market private equity firms should be praised for their contribution.”