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Is job insecurity higher in leveraged buyouts?
File(s)
Author(s)
Bacon, Nick
Hoque, Kim
Wright, Douglas
Type
Journal Article
Abstract
This article assesses whether job insecurity is higher in leveraged buyouts (LBOs) than elsewhere. It draws on matched employer‐employee data from the British 2011 Workplace Employment Relations Study linked to data from the Centre for Management Buyout Research. The analysis finds no consistent evidence of higher job insecurity in LBOs as measured by workforce reduction practices (redundancy rates, job security/no‐compulsory redundancies policies and redundancy consultation), dismissal rates, labour use practices (non‐permanent employment contracts and outsourcing) and employees’ job security perceptions. Job insecurity is no higher in either current or former LBOs than elsewhere. Contrary to what might be expected, it is also no higher in private equity (PE)‐backed LBOs, management buy‐ins or high‐debt LBOs and there is only partial and weak evidence of higher job insecurity in short‐hold LBOs. Job insecurity is also no higher in perfect storm LBOs (PE‐backed management buy‐ins that are short‐holds with high‐debt). Concerns over the negative implications of LBOs for job security thus appear misplaced.
Date Issued
2019-09-01
Date Acceptance
2018-12-05
Citation
British Journal of Industrial Relations, 2019, 57 (3), pp.479-512
URI
DOI
ISSN
0007-1080
Publisher
Wiley
Start Page
479
End Page
512
Journal / Book Title
British Journal of Industrial Relations
Volume
57
Issue
3
Copyright Statement
© 2018 John Wiley & Sons Ltd. This is the accepted version of the following article, which has been published in final form at https://onlinelibrary.wiley.com/doi/full/10.1111/bjir.12447
Subjects
Social Sciences
Industrial Relations & Labor
Business & Economics
PRIVATE EQUITY ACQUISITIONS
BUY-OUTS
IMPACT
MANAGEMENT
EMPLOYMENT
PERFORMANCE
OWNERSHIP
HRM
FINANCIALISATION
CONSEQUENCES
1503 Business and Management
1402 Applied Economics
1608 Sociology
Industrial Relations
Publication Status
Published
Date Publish Online
2018-12-26