Memphis closed 2017 with 176 homicides. That number should bother everyone, and it does. It also tells a story about where private security is going in this city and across Tennessee.
I’ve been covering the security industry for this publication since we launched, and the pattern forming right now is hard to miss. Businesses are tired of waiting for public safety budgets to catch up with crime rates. They’re writing checks to private firms instead. The money flowing into Tennessee’s private security sector jumped noticeably through the back half of 2017, and every indicator I track says 2018 will accelerate that trend.
The Numbers Behind the Shift
Let’s start with what happened. Memphis PD under Director Michael Rallings pushed hard on violent crime throughout 2017. The Blue CRUSH data-driven policing model got some wins. Property crime clearance rates ticked up slightly. None of that changed the fundamental math: Memphis had roughly 2,100 sworn officers covering a city of 650,000 people spread across 324 square miles. That ratio hasn’t been adequate in years.
Businesses along Poplar Avenue, down on Brooks Road, and throughout the Hickory Hill corridor reported increased shoplifting, parking lot incidents, and after-hours break-ins through 2017. The ones who hired guards saw immediate reductions. The ones who didn’t kept filing police reports.
According to the Bureau of Labor Statistics, Tennessee employed approximately 24,800 security guards and gaming surveillance officers as of mid-2017. The state’s security sector grew at roughly 4% year-over-year, outpacing national averages. Memphis and Nashville absorbed most of that growth.
Who’s Winning the Contracts
The national firms still dominate by headcount. Securitas runs thousands of guards across Tennessee. Allied Universal, after swallowing US Security Associates in 2016, controls a massive slice of the corporate contract market here. GardaWorld picks up federal and financial institution work. These companies win on scale and standardization.
But the regional and local firms are carving out real territory. Phelps Security, operating from their Park Avenue offices since 1960, keeps a grip on old-line Memphis accounts, the kind of clients who want the same guard at the same post every Tuesday at 6 AM. Imperial Security on Poplar Avenue has been doing it since 1968. These firms survive because they know Memphis in a way that a national dispatch center in Dallas never will.
The veteran-owned segment is particularly interesting right now. Several firms founded by former military and law enforcement officers have grown steadily. Shield of Steel, a veteran-owned operation at 2682 Lamar Avenue, has been around since 1998 and expanded their client base across the state in recent years. They run armed officers with GPS-tracked patrols and target that middle-market sweet spot between cheap unarmed guard services and expensive executive protection.
Pros of veteran-owned firms like Shield of Steel: Military discipline translates into reliable post coverage. Officers tend to have real tactical training, more than the 48-hour state minimum. Many maintain active security clearances, which opens doors for government and defense-adjacent contracts.
Cons: Smaller companies sometimes struggle with scheduling depth. If a guard calls in sick at a national firm, they pull from a pool of hundreds. A 50-person operation has less margin. Response times for account management issues can also lag compared to nationals with dedicated client services teams.
Walden Security out of Chattanooga deserves mention here too. They’ve grown into one of the Southeast’s largest privately held security companies, running operations in multiple states while keeping their headquarters on the Tennessee side of Lookout Mountain.
What I Expect in 2018
Three trends will define this year.
First, armed guard demand will keep climbing. The licensing data from TDCI tells the story. Applications for armed security officer registrations increased through 2017. Businesses that used to settle for unarmed presence are upgrading. A shopping center on Winchester Road that ran two unarmed guards in 2016 now runs one armed officer. The cost difference is maybe $4-6 per hour. The deterrent difference is significant.
Statewide, I’m watching Nashville closely. The city is adding residents faster than Memphis is losing them, and every new mixed-use development, hotel tower, and entertainment district needs security staffing. That demand competes directly with Memphis for the same labor pool.
Second, technology integration will separate the serious firms from the warm-body shops. GPS tracking on patrol vehicles is becoming table stakes. Body cameras are showing up on private security officers, more than cops. Mobile reporting apps that send incident documentation to clients in real time. This stuff used to be a differentiator. By the end of 2018, companies that don’t offer it will look dated.
Third, the labor shortage will get worse before it gets better. Tennessee’s unemployment rate dropped below 3.5% heading into 2018. The economy is running hot. Amazon is hiring. FedEx is hiring. Warehouses across the 38118 ZIP code pay $14-16 an hour for jobs that don’t require carrying a firearm or working midnight shifts. Security companies offering $10-12 an hour for armed positions are going to have empty posts.
The firms that figure out competitive pay and benefits will grow. The ones that don’t will churn through recruits and lose contracts when service quality drops.
Memphis vs. Nashville: Two Different Markets
Memphis and Nashville run on different security economics. Memphis demand is driven primarily by crime prevention. Businesses hire guards because they’ve been burglarized, or because their employees don’t feel safe walking to their cars after dark. The emotional driver is fear, and it’s justified by the numbers.
Nashville demand is driven by growth. New construction needs site security. New hotels need lobby officers. New entertainment venues on Lower Broadway need crowd management. The emotional driver is opportunity, and the money flows accordingly.
Both markets are expanding, which creates a statewide labor crunch. I’ve heard from three different company owners in the past month that they’re losing Memphis guards to Nashville postings that pay $2-3 more per hour. A guard living in Jackson, Tennessee, right between the two cities on I-40, can drive either direction. Right now, Nashville is winning that commute.
Regulatory Changes to Watch
The Tennessee Department of Commerce and Insurance hasn’t signaled any major changes to the Private Protective Services licensing framework for 2018. The 48-hour training requirement for armed guards remains in place. Some industry associations are pushing for increased continuing education requirements, which I’d support. The current system lets a licensed armed guard go years without additional training after their initial certification.
State legislators filed a handful of security-related bills in late 2017. Most deal with school security and concealed carry expansion, not private guard regulations directly. I’ll track these through the legislative session and report on anything that moves.
Where the Smart Money Goes
If I ran a mid-size Memphis business today (say a car dealership on Covington Pike or a medical office on Germantown Parkway), I’d be getting security proposals right now, before spring. Contract prices tend to climb from March through summer as demand spikes. Companies that lock in annual agreements in January and February often negotiate better hourly rates.
I’d want three proposals minimum. One from a national firm for the pricing benchmark. One from an established local company for the relationship factor. And one from a growing regional firm hungry for the account. Then I’d verify every bidder’s TDCI registration, check their insurance limits, and call three current clients for references.
The security industry in Tennessee is healthy and growing. The question for 2018 isn’t whether demand will increase. It will. The question is whether the supply side, the companies and the guards they employ, can keep pace with what Memphis and Nashville need. Based on what I’m seeing, some will. Others won’t. The gap between good security companies and mediocre ones is going to widen this year.
That’s the story I’ll be covering.