Atlanta GA March 16 2012The private security industry is one sector of the economy that is projected to benefit from both perception and reality, even though the two are at odds with one another.
The overall mood in the United States is still sour due to the perceived state of the economy, at least according to 55 percent of responders to a recent Pew Research Center study. However, another source shows that businesses are actually beginning to rebound from the 2007-2009 recession. So, how are industries that serve both publics to know what is real and what is simply in the mind of the beholder?
The answer is that both scenarios are true ─ at least for the private security industry. Private security is projected to grow more than 6 percent in 2012 – the largest increase in nine years, according to a 2010 IBISWorld Industry Report on Security Services in the U.S. The same report shows that businesses are reevaluating where their recovered dollars should be spent and investing in better security.
According to the IBIS research, between the years 2010 and 2015, companies will increase their security budgets as business sentiment improves and more funds become available. Many businesses will increase the number of contracted security staff, as well as the number of hours that guards are on duty. The rise in demand is projected to cause industry revenue to increase by 4.9 percent per year to $32.85 billion at the end of 2015.
On the contrary, the Pew study shows that Americans consider the economy in an even worse position than in 2008, when the nation was in the middle of the recession. At that time, only 34 percent of Americans saw the country’s economic future as bleak. Today, that number is up to 55 percent.
This negative perception also drives the security business, causing Americans to take extra precautions against crimes of opportunity – those that are committed when people grow desperate as a result of their jobless, financial situation.
When our economic outlook is bleak, individuals tend to think that their personal safety is in jeopardy, said one security business owner.
“As unemployment rates remain high and homes continue to go into foreclosure, concerns for public safety heighten – and so does the need for private security.”
Another factor driving the security industry’s projected growth is the reduction of government jobs. According to the February jobs report from the Bureau of Labor Statistics, one-fifth of the industries with the largest projected wage and salary employment declines are government agencies or municipalities. Existing public safety personnel, including local law enforcement, will go on the chopping block – leading to outsourcing.
In late February 2012, a government-owned and operated electricity company in Tennessee laid off61 percent of its uniformed police officers and replaced them with enhanced security technology and more contract security guards at its critical non-nuclear energy sites.
This is just one example of public budgets feeling the squeeze and opening the door for private security, which generally provides more affordable protection than traditional law enforcement – with the added benefit of keeping the reduced number of traditional law enforcement officers on the streets, patrolling areas that are more impacted by serious crime.