According to the study "Private Equity and Job Creation", prepared by SpainCap, Private Capital continues to prove to be a fundamental lever for growth and job creation for Spanish companies, even in an uncertain economic context. The sector manages 43.62 billion euros from national and international savers and is present in the capital of more than 3,000 Spanish companies. The latest investment figures, which set absolute records in the first half of 2022, confirmed the trend of increasing mobilization of resources by Private Equity & Venture Capital towards the national business fabric and especially towards small and medium-sized enterprises (SMEs), which represent around 90% of the companies in which it has a stake. But it is not only Private Equity that creates added value beyond investment, as can be seen in the numerous studies and reports published by SpainCap on impact, sustainability, and diversity.
Another aspect where the industry generates positive effects is in the commitment and maintenance of quality employment, as shown by the data presented in this report. The 3,012 companies owned by Private Capital fund managers analyzed in this report achieved a 6.4% increase in their workforce in 2021, equivalent to 29,157 jobs, totaling 481,334 workers. This growth is slightly more than two percentage points higher than that recorded in Spain as a whole (+4.3%). These figures undoubtedly confirm the growth capacity of the companies invested in and managed by Private Capital firms, even in unstable economic cycles and in practically all sectors of activity. Likewise, this capacity to generate and maintain employment contributes to the achievement of two of the country's main objectives: attracting and retaining talent.
Given the dual orientation of Private Equity towards early-stage companies or towards investments for consolidation and development of business groups, it is important to differentiate between Venture Capital (VC) and Private Equity (PE) investment. The support to early-stage innovative companies through Venture Capital investment enabled the increase of 26,658 workers in the workforce throughout 2021, representing a growth of 49.6%. In the case of more developed companies or backed by Private Equity, the slow recovery of the COVID impact marked a positive, albeit modest, growth of 0.6% in the portfolio of its investees. In the Venture Capital segment, support for companies in the accelerated growth phase was particularly strong, while in the Private Equity segment, companies in the Growth and Buyout phases accelerated job creation.
By sector, the global health crisis of the coronavirus benefited the employment generation of companies in innovative and/or technological sectors related to Healthcare, Energy/Environment or Information Technology, but disadvantaged companies in other more traditional segments such as Hospitality/Leisure, very present in the portfolio of Private Equity in Spain, Transportation and Construction.
By geographical distribution, companies based in the Community of Madrid accounted for almost half of the number of workers in Private Equity investees, although in 2021 the total number of workers increased by just 0.5%. Catalonia stood out, with 14% of total employment in the total portfolio of Private Capital firms, achieving a 6.9% growth in new jobs.
By size, in a country like Spain which mostly has SMEs, the category of companies with fewer than 50 workers stood out, with employment growing by 4.5% in the last year. In medium-sized companies, the growth in employment in the 50-99 worker (+15%) and 200-250 worker (+20%) categories stood out.
In addition to the analysis of employment evolution in the Venture Capital and Private Equity industry, in 2021, 62% of the 2,796 companies in the portfolio as of December 31, 2020 were analyzed to extract information on their average salaries. The conclusions follow the same line as that of job creation and thus the average cost of personnel reaches €35,348 per worker, resulting in an average salary of €27,191, which represents a +8.05% compared to the €25,166 national average in Spain in 2020 (Spanish National Institute of Statistics).
The report is based on the analysis of 3,012 Spanish companies owned by 531 domestic and foreign Private Capital firms at the end of 2021. To observe employment growth, the starting point was set at 2020.
SPAINCAP
SpainCap is the association that brings together Venture Capital & Private Equity firms in Spain, as well as their investors, including insurance companies and pension funds. SpainCap members invest in medium and long term in unlisted companies, from startups to established companies, providing not only stable financing through equity, but also innovation and management support. The mission of the association is to connect all industry players in Spain, representing their interests before the Administration, the media and public opinion, both nationally and internationally, through alliances and synergies in Europe and Latin America. Its objectives include establishing an appropriate regulatory framework for the sector and communicating the positive impact of its activity on the industrial fabric and the job creation it generates. As a member of the UN Global Compact, one of SpainCap's main missions is to promote sustainability among its members and in the companies in which they invest. It also promotes professional development through training programs and actively promotes knowledge through the publication of statistical reports and economic and social impact studies, which demonstrate the added value provided by this sector. www.spaincap.org
For more information:
cloud technology axon
Wellk es una startup guipuzcoana que nació hace tres años, que cuent...
