World demand to 7.4% annually through 2016
Global demand for private contract security services will increase 7.4 percent annually to $244 billion in 2016. In general, demand for security services is driven by rising urbanization, the real and perceived risks of crime and terrorism, belief that public safety measures are insufficient, and growth of a middle class with assets to protect and the means to pay for supplementary security measures. The security service market will also be supported by an improved economic environment and building construction activity.
Developing areas to see strongest gains in demand
The strongest gains will be posted in developing parts of Asia, Eastern Europe, Africa, and the Middle East, where security markets are relatively underdeveloped. In fact, several -- markets, including China, India, Mexico, Russia, and South Africa -- are expected to achieve double-digit annual growth through 2016. In many of these areas, the intensity of security service use (measured against indicators such as GDP and urban population) is relatively low, indicating significant growth potential going forward.
Factors such as rapid gains in economic activity, rising personal incomes, foreign investment activity, and concern that public safety forces are overburdened, corrupt, or unable to provide sufficient protection will boost gains. Furthermore, increasing regulation and a trend toward greater professionalism in many of these local security service markets will improve public trust in security service businesses, thereby driving gains.
US to remain largest market
The US will remain the largest national consumer of private contract security services, accounting for 26 percent of total world demand in 2016. Despite its maturity, the dominant size of the US market means that it will account for more than one-fifth of total global increases between 2011 and 2016, even with a below average growth rate. Brazil, the world’s second largest national market in 2011, will post above average increases and represent another seven percent of global growth through 2016. Two smaller developing national markets for security services, India and China, will together account for an additional 13 percent of world gains through 2016.
Contract guarding to remain largest service segment
Contract guarding will continue to be the largest type of security service, accounting for more than half of total revenues in 2016. This segment benefits from the minimal capital requirements for operation which, along with relatively low labor costs, make it the dominant security service in developing markets. The alarm monitoring segment is expected to see the strongest growth.
Study Scope
This study analyzes the $171 billion world security service industry. It presents historical demand data for the years 2001, 2006 and 2011, and forecasts for 2016 and 2021 by service (e.g., guard services, alarm monitoring, armored transport, private prison management, consulting, private investigations), market (commercial and industrial, government and institutional, residential), world region and for 21 major countries.
The study also considers market environment factors, details industry structure, evaluates company market share and profiles 37 industry participants such as G4S, Securitas AB, and Tyco International.