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Is job insecurity higher in leveraged buyouts?

Bacon, N. ORCID: 0000-0002-1031-1246, Hoque, K. and Wright, M. (2018). Is job insecurity higher in leveraged buyouts?. British Journal of Industrial Relations, doi: 10.1111/bjir.12447

Abstract

This paper 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-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.

Publication Type: Article
Additional Information: This is the peer reviewed version of the following article: Bacon, N. , Hoque, K. and Wright, M. (2018). Is job insecurity higher in leveraged buyouts?, British Journal of Industrial Relations,, which has been published in final form at https://doi.org/10.1111/bjir.12447. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions.
Publisher Keywords: Job insecurity; Leveraged buyouts; Private equity; Alternative investments; Corporate reorganizations.
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HG Finance
Departments: Cass Business School > Management
URI: http://openaccess.city.ac.uk/id/eprint/21074
[img] Text - Accepted Version
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