SANTA CLARA, Calif. (MarketWatch) — Discussions about the 100,000 jobs created by Mitt Romney during his years as CEO of Bain Capital have surfaced again. While there appears to be no question that Mitt Romney made successful investments — and a lot of money — did Mitt Romney create more than 100,000 jobs while at Bain Capital?

Both the Republican candidate and incumbent Democratic president feel Romney’s experience as CEO of Bain Capital is a useful topic for their campaigns. Romney says it prepared him to become a job-creating president, and Barack Obama’s team believes it shows that Romney does not care about the 99% who can be adversely affected by the activities of private equity firms.

Republican presidential candidate Mitt Romney claims Bain Capital created about 100,000 jobs while he was CEO, but economist John Ifcher says Romney forgets to take competitors’ job losses into account. Reuters

The job of the president of the United States is starkly different from that of the head of a private-equity firm. Obama’s net jobs performance includes a loss of about 550,000 jobs since he took office (excluding job losses in January 2009), according to the Bureau of Labor Statistics. However, since the recession officially ended in June 2009, about 2.5 million jobs have been created.

Key in counting job creation is including not only new jobs, but also those jobs that are lost. This is where the debate turns to a comparison between apples and oranges, at least from the perspective of an economist. The Labor Department counts both sides. The Romney campaign conveniently omits the indirect adverse effects — for example, crowding competitors out of the market — of helping companies grow and prosper.

I am not disputing the fact that if you add up all the new employees who were hired by companies while owned by Bain Capital that you would get a number north of 100,000. Moreover, even if one calculates net new employees — the number of new employees hired minus those who lost jobs directly due to Bain Capital’s ownership and activities — I suspect one could still show that more than 100,000 net new employees were hired by companies owned by Bain Capital.

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No, my concern is that the above analysis only considers the direct effects and not the indirect effects of Bain Capital’s ownership and activities. For example, as companies acquired by Bain Capital expand, what happens to competitors? Consider Staples Inc., touted to be one of Bain Capital’s biggest successes. Sure, Staples grew from one store in 1986 to more than 1,000 stores in 1996, and in the process, hired tens of thousands of new employees (today Staples employs more than 90,000 people).

But did Staples’ expansion create tens of thousands of jobs? The answer is no. Why? Because when you consider the indirect, or second-order effects of Staples’ expansion, it becomes clear that as Staples expanded it displaced other retailers. That is, was Staples’ dizzying expansion fueled by an equally dizzying increase in the market for office supplies in the U.S.? Or did Staples’ expansion crowd out other retailers?

Data from the U.S. Census Bureau appears to support the latter. The number of retail establishments primarily engaged in the distribution of stationery, such as paper and paper products, declined by 25% (from 5,391 to 4,041) between 1986 and 1996.

If these displaced retailers were as efficient as Staples, then for each new employee that Staples hired theoretically one job was lost at a displaced retailer. However, if Staples was in fact more efficient on average than the displaced retailers, then more than one job might have been lost for each job that Staples “created.” So, Staples’ expansion may have reduced net jobs in that industry.

Again, data from the U.S. Census Bureau appears to support the latter. Between 1986 and 1996, the number of employees working at retail establishments primarily engaged in the distribution of stationery declined by 35%.

In all likelihood, we would see a similar story emerge for other companies that Bain Capital acquired, such as Burger King, Hospital Corporation of America, The Sports Authority, and Toys “R” Us.

This discussion is admittedly far from complete and certainly does not consider all the effects — labor market and otherwise — of Bain Capital’s acquisitions. Further, this discussion is not intended to pass judgment on Bain Capital’s activities — or other private-equity firms’ activities.

Determining whether such firms are “good” or “bad” for the economy is beyond the scope of this piece. I simply want to point out that counting the number of new employees hired as a result of a firm’s activities is a misleading measure of job creation at best.

John Ifcher is an assistant professor of economics at Santa Clara University.