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Social cost of private equity

Phillip Inman

PRIVATE EQUITY firms are reshaping the American economy to the detriment of workers and local communities, one of the largest trade unions in the United States said on Tuesday night after publishing a report into the industry's growing influence.

The almost two million-strong Service Employees International Union said the booming private equity buyout industry had turned back the clock on community involvement and workers' rights.

In a dossier documenting private equity deals in the U.S. over recent years, the union highlighted buyouts that it argued left companies "hollowed out" or even bankrupt. Others saw gains that were paid exclusively to the new private equity owners. The union has launched a website BehindtheBuyouts.org, to act as a forum for information on the private equity industry. —

© Guardian Newspapers Limited 2006

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