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Doug Krizner: The second-largest private employer in America today, after Wal-Mart, is Kolberg Kravis Roberts. KKR is a buyout firm indirectly employing more than half a million — that's more than McDonald's, and almost twice as many as GM.

Right now, buyout firms indirectly employ more than five million Americans. As Marketplace's Steve Henn reports, American unions are struggling to come to terms with the new masters of the American economy.


Steve Henn: Private equity companies have raised more than $400 billion for buyouts in the last year alone. So when the 700 workers at Freightliners Portland, Oregon plant voted to strike last month, they were worried about one thing, according to union negotiator Joe Kear: being bought out and laid off.

Joe Kear: Seventy-three percent had expressed this was their number-one concern going into the negotiations — job security.

Kear gave up the unions' retiree health insurance in exchange for a guarantee that if the company was sold out, the union contract would remain in effect.

Santa Clara law school professor Stephen Diamond says these agreements can prevent layoffs.

Stephen Diamond: Unions need some way to secure their achievements for the workforce from buyer to buyer. On the other hand, if this is essentially shuffling deck chairs on the Titanic, it's not going to make much difference.

But Diamond says right now, it is the best many unions can do — especially since employers say these contracts make their businesses harder to sell.

In Washington, I'm Steve Henn for Marketplace.