How Do Employees Fare in Private Equity Buyouts? Evidence from Workplace Safety Records

54 Pages Posted: 8 Feb 2016 Last revised: 3 Nov 2016

Jonathan B. Cohn

University of Texas at Austin

Nicole Nestoriak

Bureau of Labor Statistics

Malcolm Wardlaw

University of Texas - Dallas

Date Written: August 25, 2016

Abstract

This paper presents evidence that workplace injury rates decline substantially after private equity buyouts. The decline holds for buyouts of public firms but not private firms, and is greater for public firms likely facing more pressure pre-buyout to deliver short-term performance, suggesting that alleviating pressure on managers to make short-sighted decisions can improve workplace safety. There is some evidence that high levels of buyout debt lessen the decline in injury rate. Finally, employment after buyouts declines more at relatively safe establishments, though this effect is small relative to the injury rate decline within establishments.

Keywords: Private equity buyouts, workplace safety, labor and finance

JEL Classification: G32, J28

Suggested Citation

Cohn, Jonathan B. and Nestoriak, Nicole and Wardlaw, Malcolm, How Do Employees Fare in Private Equity Buyouts? Evidence from Workplace Safety Records (August 25, 2016). Available at SSRN: https://ssrn.com/abstract=2728704 or http://dx.doi.org/10.2139/ssrn.2728704

Jonathan B. Cohn (Contact Author)

University of Texas at Austin ( email )

Red McCombs School of Business
Austin, TX 78712
United States
512-232-6827 (Phone)

Nicole Nestoriak

Bureau of Labor Statistics ( email )

2 Massachusetts Avenue, NE
Washington, DC 20212
United States

Malcolm Wardlaw

University of Texas - Dallas ( email )

2601 North Floyd Road
P.O. Box 830688
Richardson, TX 75083
United States
972-883-5903 (Phone)

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