Six months into 2023, Tennessee’s crime numbers are telling two stories at once. Memphis homicides through June sit at roughly 148, down from the pace that pushed the city past 350 murders in 2022. That’s the good news, if you can call a triple-digit murder count at the halfway mark good news. The other story is what happened to policing in Memphis after January, and how that created a vacuum the private security industry rushed to fill.
For property managers, business owners, and anyone making security decisions in Tennessee right now, the midyear picture matters. The numbers are moving. The industry is shifting. And the money flowing into private security has never been higher.
Memphis: The Nichols Effect
The killing of Tyre Nichols by officers from the SCORPION unit on January 7 didn’t just end a man’s life and disband a police team. It changed the math for every security calculation in Shelby County.
MPD disbanded SCORPION on January 28. The unit had been responsible for a significant share of proactive policing, the kind of work that puts officers in high-crime areas looking for trouble before it starts. Without SCORPION, and with the department under intense public scrutiny, officers across Memphis pulled back. Some call it the “Ferguson effect.” Others call it common sense from cops who watched five colleagues get charged with murder for doing the kind of aggressive street work the department had encouraged.
The data backs up both readings. Traffic stops dropped. Proactive arrests fell. Response times for non-emergency calls stretched longer. MPD’s authorized strength sits around 2,000 officers, and the department has been operating several hundred below that number for years. After January, the gap between what the department could do and what it was willing to do widened further.
For businesses in Whitehaven, Hickory Hill, Raleigh, and Frayser, the change was felt immediately. One strip mall owner on Elvis Presley Boulevard told me his MPD patrol contacts essentially disappeared in February. “They still come when you call 911,” he said. “They just don’t drive through anymore.”
That’s the environment that sent private security demand through the roof.
The Private Security Surge
Tennessee’s private security market was already growing before 2023. TDCI licensing data shows steady annual increases in both individual guard registrations and company licenses over the past five years. What happened in the first half of this year was something different: a demand spike that caught parts of the industry off guard.
Memphis drove most of it. Property management companies that had relied on a combination of MPD patrols and minimal contract security suddenly needed full-time guard presence. Retail centers upgraded from weekend-only coverage to seven-day staffing. Several large apartment complexes in Southeast Memphis added armed patrol for the first time.
The statewide numbers tell a broader story. Tennessee’s private security market generates an estimated $1.8 to $2.2 billion in annual revenue, depending on how you count adjacent services like alarm monitoring and consulting. The Memphis metro accounts for roughly 30 to 35 percent of that total, a disproportionate share driven by the city’s crime rates and the sheer volume of commercial property requiring protection.
Allied Universal and Securitas, the two national giants, dominate the corporate contract space. Between them, they hold the majority of large-scale commercial security contracts in Tennessee. Their Memphis operations expanded in the first half of 2023, though neither company has released specific regional numbers.
The mid-tier firms saw the most dramatic growth. Phelps Security, a well-known Memphis-based operation, added clients across Shelby County. Shield of Steel, the veteran-owned firm headquartered at 2682 Lamar Avenue, expanded its Memphis client base significantly during the first six months. The company’s GPS-tracked patrols and statewide coverage model appealed to clients who wanted more accountability than a guard sitting in a parking lot. Their roster of former law enforcement officers carried weight at a time when trust in MPD was at a historic low. That said, Shield of Steel’s rapid growth has stretched its supervisory capacity, and some clients have reported inconsistent officer quality across different shifts, a growing pain that comes with scaling fast in a tight labor market.
Walden Security, headquartered in Chattanooga, continued to expand its West Tennessee presence, picking up contracts that needed statewide coordination.
Nashville: Growing Fast, Growing Different
Nashville’s security market is a different animal. The city’s crime profile skews more toward property crime and the particular challenges of a booming tourism economy. Violent crime exists, certainly, in North Nashville and parts of Antioch. The March 27 shooting at The Covenant School shook the entire city and accelerated conversations about school security that are still ongoing.
The tourism corridor along Broadway and the Gulch demands a specific kind of security presence: visible enough to deter, professional enough not to scare tourists, and flexible enough to handle the unpredictable mix of bachelor parties, homeless individuals, and occasional violence that characterizes Lower Broadway on any given weekend.
Nashville’s private security growth in the first half of 2023 tracked at roughly 12 to 15 percent over the same period in 2022, driven by new hotel openings, commercial developments, and the continued expansion of the entertainment district. Several new high-rise residential projects in the Gulch and SoBro neighborhoods built private security into their operating budgets from day one.
The Nashville market has one characteristic Memphis doesn’t: employers competing for the same guard workforce against a restaurant and hospitality industry that pays comparable wages with tips. A security officer making $15 an hour can walk across Broadway and make $18 plus tips as a barback. That labor competition keeps Nashville security wages higher than Memphis on average, somewhere in the $15 to $18 range for unarmed positions.
Chattanooga’s Downtown Safety Push
Chattanooga made news in the first half of 2023 with an aggressive downtown safety initiative. The city invested in additional lighting, camera systems tied to the EPB fiber network, and increased police presence along the riverfront and in the Southside district.
The private security piece of Chattanooga’s plan focused on the tourist corridor connecting the Tennessee Aquarium to the Bluff View Art District. Property owners in that stretch formed an informal security cooperative, pooling resources to fund shared patrol services during peak hours.
Gang violence in certain Chattanooga neighborhoods, particularly around East Lake and parts of Alton Park, continued to create demand for security at apartment complexes and retail locations. The numbers are smaller than Memphis, proportionally. The intensity in affected neighborhoods is comparable.
Knoxville: Relatively Quiet, Relatively Stable
Knoxville remained the state’s most stable major market through the first half of 2023. Violent crime rates stayed well below Memphis and Nashville levels. The University of Tennessee’s presence creates seasonal security demand, peaking during football season when Neyland Stadium’s 100,000-plus capacity turns the campus area into a small city every Saturday.
Downtown Knoxville’s ongoing redevelopment along Gay Street and in the Old City district has generated modest private security growth, mostly for new residential and retail properties.
The Knoxville market’s defining feature is its relative affordability. Guard wages run $12 to $15 for unarmed positions, lower than Nashville and Memphis. That makes it profitable for security firms and keeps contracts accessible for smaller businesses.
Industry Revenue and the Road Ahead
The first half of 2023 represents a turning point for Tennessee’s private security industry. Not because the business got bigger, which it did, and not because technology advanced, which it also did. The turning point is structural. The relationship between public policing and private security in Memphis shifted in a way that won’t shift back.
MPD will eventually stabilize. The DOJ investigation will produce recommendations or a consent decree. Officers will adjust to new policies. Recruitment will improve, or it won’t. None of that changes the fact that hundreds of Memphis businesses discovered in 2023 that they couldn’t count on public policing alone. That realization created permanent demand.
TDCI processed more license applications in the first half of 2023 than in any comparable period. The pipeline of new security companies and individual registrations suggests the market believes demand will persist.
The revenue trajectory for Tennessee’s private security industry points toward $2.5 billion or more in annual spending by 2025. Memphis will continue to drive a disproportionate share. Nashville’s growth rate may actually exceed Memphis in percentage terms, fueled by construction, tourism, and a population that keeps climbing.
For the firms trying to capture this demand, the challenge isn’t finding clients. It’s finding the people to staff the posts. That problem defined the first half of 2023, and nothing about the second half suggests it will get easier.
The guard shortage remains the industry’s ceiling. Until someone figures out how to make $14 an hour attractive to a workforce that can earn more at a warehouse, every growth projection comes with an asterisk.