New Report Shows Private Equity’s Positive Impact on U.S. Economy

November 1, 2019 by Dan McCue

WASHINGTON – Private equity sector is playing a positive role in the U.S. economy, supporting more than 26 million jobs while accounting for about 5% of the nation’s gross domestic product, according to a new report.

The analysis comes from Ernst & Young, which worked in partnership on the report with the American Investment Council. Together they estimate those 26 million workers earned a total $1.7 trillion in wages and benefits and generated $2.9 trillion in value last year.

Additionally, the report says the federal, state, and local taxes paid by, and related to, the U.S. private equity sector totaled nearly $500 billion in 2018.

In conjunction with the report’s release, AIC is also launching a new website and a substantial national digital advertising campaign to educate Americans about the role private equity plays in creating jobs, driving economic growth and supporting local communities. 

“This new report shines an important and timely light on the positive and growing impact private equity has on the strength and success of our nation’s economy,” said Drew Maloney, president and CEO of the American Investment Council.

“From helping rebuild America’s manufacturing base to supporting millions of good-paying jobs in industries from tech to hotels to transportation and trade, private equity is a driving force for economic growth and opportunity for our country’s economy and workers,” Maloney said.

The report reveals that private equity now has a total economic impact in the U.S. of nearly $1.1 trillion.  The study also shows that private equity plays a vital role in the tax base of our states and local communities, supporting critical investments in schools, transportation, infrastructure and other key priorities.

In 2018, alone, the U.S. private equity sector paid $174 billion in federal, state, and local taxes. Approximately two-thirds of these were federal taxes ($113 billion) with the remaining taxes paid to state and local governments ($61 billion).

“Every single member of Congress has private equity-backed jobs and investment in their local communities. Whether it’s picking up coffee from Dunkin Donuts, buying milk from Dollar General, staying in a hotel like a Hilton or taking a Lyft across their town, the positive force of private equity is being felt in communities and jobs throughout the country every day,” Maloney said.

A separate American Investment Council report, released in July, detailed the positive role private equity now plays in providing a stronger and more secure retirement for millions of Americans, including teachers and first responders. 

The report analyzed investment returns by 165 U.S. public pension funds and highlighted how private equity continues to deliver the highest returns of any asset class.

The study showed private equity continues to lead all asset classes in long-term investment performance, with private equity’s median 10-year annualized return of 10.2% surpassing public equity’s 8.5% and real estate’s 4.8%.

In The News

Health

Voting

Economy

House Passes $1.9 Trillion COVID Relief Package
Congress
House Passes $1.9 Trillion COVID Relief Package
February 27, 2021
by Dan McCue

WASHINGTON – The House passed a $1.9 trillion coronavirus relief package in the wee hours of Saturday morning, helping President Joe Biden clear the first hurdle in passing an economic stimulus bill that includes $1,400 in direct payments to U.S. households, an extension of federal supplements... Read More

A New Mayor Champions Keeping COVID-Impacted Families In Their Homes
In The States
A New Mayor Champions Keeping COVID-Impacted Families In Their Homes
February 26, 2021
by Dan McCue

BOISE, Idaho – To the outsider, it seems like a movie that has a bizarre twist just as the heroine should be taking her victory lap.  Lauren Stein McLean, an entrepreneur who had served on Boise, Idaho’s city council for nearly a decade, and served as... Read More

House to Vote on Virus Bill; Arbiter Says Wage Hike a No-Go
U.S. Senate
House to Vote on Virus Bill; Arbiter Says Wage Hike a No-Go

WASHINGTON (AP) — Democrats are ready to shove a $1.9 trillion COVID-19 relief package through the House on Friday, despite a setback that means a minimum wage boost is unlikely to be in the final version that reaches President Joe Biden.A near party-line vote seemed certain... Read More

US Jobless Claims Fall to 730,000 But Layoffs Remain High
Economy
US Jobless Claims Fall to 730,000 But Layoffs Remain High

WASHINGTON (AP) — The number of Americans seeking unemployment benefits fell sharply last week but remained high by historical standards.  Applications for benefits declined 111,000 from the previous week to a seasonally adjusted 730,000, the Labor Department said Thursday. It is the lowest figure since late... Read More

Fauci: Whatever Vaccine is Available, Take It
Health
Fauci: Whatever Vaccine is Available, Take It

WASHINGTON — Dr. Anthony Fauci says if a coronavirus vaccine is available, regardless of which one, take it. The top U.S. infectious disease expert told NBC on Thursday a third vaccine becoming available “is nothing but good news” and would help control of the pandemic. U.S.... Read More

GOP Rallies Solidly Against Democrats' Virus Relief Package
Congress
GOP Rallies Solidly Against Democrats' Virus Relief Package

WASHINGTON (AP) — Republicans rallied solidly against Democrats' proposed $1.9 trillion COVID-19 relief bill as lawmakers awaited a decision by the Senate's parliamentarian that could bolster or potentially kill a pivotal provision hiking the federal minimum wage.  Despite their paper-thin congressional majorities, Democratic leaders were poised to push... Read More

News From The Well
scroll top