Is Private Equity a Jobs Creator?

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Yesterday I joined Maria Bartiromo on Fox Business. As always, it was a great show. We had two guests that did a great job explaining the state of the private market industry. Dave Calhoun, the Global Head of Private Equity at Blackstone and Bob Nardelli, the former Chrysler CEO, joined to discuss whether private equity helps create or destroy jobs.

Let’s take a step back for a second… Traditionally, many people think of private equity as group of corporate raiders – investors who jump in to destroy/shuffle up companies, make money, and exit. Truth be told, that’s typically not the case. Private Equity is a very popular and growing industry. There are enormous growth opportunities within private companies and institutional money is beginning to understand this more and more as they search for returns in this low-interest rate environment.

Private Equity companies do a great job of saving jobs everyday by infusing capital with the right strategy in mind. When capital is infused strategically, jobs are not only saved, but added. When invested, Private Equity companies take the offensive approach, constantly thinking how to improve a company. As a private market investor, my approach entails remaining in companies for the long term and helping them spark growth.

Right now our current economy is growing very slowly. The United States is seeing 1% growth. But, I have never been more optimistic about what technology can and will do for the entire world. Our high corporate tax rate and the fact that small businesses are seeing more regulations are two huge issues hampering growth. Government in general can slow down everything about a company’s performance in the public and private markets. In my opinion, lowering taxes on the corporate side and the unwinding of certain regulations will help unleash new economic growth.

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