Invest Europe, the association representing Europe’s private equity, venture capital and infrastructure sectors, as well as their investors, today published its Private Equity at Work report, the fourth edition of the landmark study on employment and job creation in Europe. The research shows that private equity and venture capital are outperforming in job creation, adding 6.5% more jobs across portfolio companies in the COVID recovery in 2021 – over five times the 1.2% job creation rate across Europe.
- Companies financed by private equity and venture capital added 341,910 jobs in 2021, roughly equivalent to the population of Bilbao, Spain. All segments of the industry saw strong levels of job creation, led by fast-growing venture capital-backed companies which added 25% more jobs in 2021, and followed by businesses with growth investment that added 14% more workers.
- Companies backed by private equity and venture capital employed 10.5 million people in 2021, supporting workers in over 26,000 companies in cities and regions across the continent. This figure includes nearly 900,000 people in over 18,500 SMEs, the backbone of Europe’s economy and the source of much of its future growth, adding 12% more jobs in 2021.
Invest Europe’s Private Equity at Work not only shows how the industry has outperformed the economy in 2021, but also how it has contributed to job growth during periods of economic expansion and recession. Companies backed by private capital added 431,156 more jobs at companies between 2017 and 2021, and saw an average yearly job creation of +4.4% during the period. Venture-stage companies saw the highest average yearly job creation rate during 2017-2021 (18%), while buyout-stage companies added the most jobs, with a total of 230,000 over the period. The industry continued to create jobs in the midst of the pandemic with 11,564 or 0.4% in 2019-2020. In just one year (2020-2021), the level of job creation returned to pre-pandemic levels at 5%, or +135,220.
The data reflects the strong relationship between the industry’s commitment to investment, growth and job creation and protection, as funds invested €490 billion in companies across Europe between 2017 and 2021, with €172 billion directly pledged by pension funds and insurers over the same period.
Eric de Montgolfier, CEO of Invest Europe, commented:
- “The positive impact of private equity and venture capital on employment and job creation is becoming more evident with each passing year. The industry stepped up to the mark again in 2021, helping drive Europe’s recovery from the pandemic by creating over five times more jobs than the rest of the continent’s companies.
- “From buyout-stage companies employing millions, to venture-backed start-ups and high-growth SMEs creating jobs at an exponential rate, the industry supports major employers at the heart of communities today, while paving the way for a better tomorrow with high-skilled jobs in fast-growing industries such as tech and biotech & healthcare.”
Private Equity at Work showcases the industry’s employment and job creation in sectors at the forefront of European growth and competitiveness. The large ICT and Biotech & Healthcare sectors, both employing well over 1 million people, increased jobs by 13.6% and 7.2% respectively in 2021, well above the European average.
Invest Europe’s data also highlights the industry’s strong performance in terms of job creation across all regions. The CEE was the most dynamic region for job growth in 2021, adding 10.6% more jobs, followed by the Nordics with 9.4% more employees, and the DACH region with 7.3%. France & Benelux was the largest region for private equity and venture capital jobs (3.6 million) in 2021, adding some 130,000 more jobs over the year.
Click here to read Private Equity at Work.
About Invest Europe
Invest Europe is the association representing Europe’s private equity, venture capital and infrastructure sectors, as well as their investors. We have over 650 members, split roughly equally between private equity, venture capital and limited partners – with some 110 associate members representing advisers to our ecosystem. Those members are based in 57 countries, including 42 in Europe, and manage 70% of the European private equity and venture capital industry’s €846 billion of assets under management. Businesses with private capital investment employ 10.5 million people across Europe, 4.5% of the region’s workforce.
The research shows that private equity and venture capital are outperforming in job creation, adding 6.5% more jobs across portfolio companies in the COVID recovery in 2021 – over five times the 1.2% job creation rate across Europe.