Employment & job creation
By portfolio company size
How is employment and job creation affected by company size?
In general, smaller companies achieve faster growth. But although larger companies grow at slower rates, the number of net jobs they create is far greater.
Of course job creation isn’t only about size. It also requires the right product or service for the market, scalability, skilled management and suitable investment.
>1 million
people were employed in roughly
21,540
SMEs backed by private equity in 2023
See A focus on SMEs section
for SMEs analysis
Employment
Private equity specialises in active portfolio management, enabling companies to grow and create jobs, whatever their size. Once a portfolio company’s market and growth potential are identified, private equity provides the support and investment to drive growth. When private equity, together with management teams and entrepreneurs get this right, companies of all sizes increase employment.
Employment 2023
By company size
2 million
employees in 2023
working inprivate equity-
backed companies with
<500 employees.
18% of all private equity-
backed jobs, in 84% of
portfolio companies.
9 million
employees in 2023
working inprivate equity-
backed companies with
>500 employees.
82% of all private equity-
backed jobs, in 18% of
portfolio companies.
Job creation
Companies with 500-999 employees experienced the highest employment growth rates between 2022-2023 (+7.9%). They were followed by companies with 251-499 and 0-250 employees, which saw a growth rates of 6.9% and 6.4% respectively. In absolute numbers, companies with 5,000+ employees created the most jobs: +121,516, followed by companies with 1,000-4,999 employees, which created 114,673 jobs in 2023.
+6.4%
more new jobs created by SMEs in 2023
Job creation 2022-23
By company size
‘Graduation’ to higher size category
We estimate that overall, 10% of portfolio companies ‘graduated’ to a higher category based on the number of employees during 2023. This is slightly higher than levels seen in previous years. A significant proportion of SMEs in our sample saw year-on-year growth and job creation, fuelled by investment and management support from their private equity backers. The highest proportion was seen in the 200-250 employee category, with 35% of these companies moving up to a higher size category in 2023.
See Multi-year trend section for
details on graduation in companies
from 2017-2023