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

Marc Goergen, Noel O'Sullivan, Geoffrey Wood

Research output: Contribution to journalArticleResearchpeer-review

22 Citations (Scopus)


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.

Original languageEnglish
Pages (from-to)145-158
Number of pages14
JournalHuman Resource Management Journal
Issue number2
Publication statusPublished - Apr 2014
Externally publishedYes

Cite this