Security & Guard Services
“Market Wages” and How They Affect Your Manned Security Program
You have a contract security program for a reason. You have products, facilities, processes, and people that you need to protect. If your contract security provider is struggling to find or keep quality security officers assigned to your account, your organization’s safety and security may suffer. If the quality and cohesion of your security program erodes, your organization could be exposed to greater risks and liabilities.
If your organization uses a contract security provider, you have probably encountered scenarios where:
- Your security supplier has struggled to recruit new or replacement personnel
- There has been excessive turnover of existing personnel
- Chronic staffing shortages have resulted in unstaffed “dark” hours on the security schedule
Sound familiar? These contract staffing challenges are often a sign of poor management or oversight by the provider—but they could also be a symptom of a fundamental component of the security staffing world: inadequate wage rates.
What is a Market Wage?
Contract manned security is a labor-based service, and as such, the wages that the officers are paid play a fundamental role in the functionality and success of any security program. The critical factor in determining appropriate wage levels for the security personnel assigned to your account is the “market wage” for each position. Simply put, a market wage is the average wage that an employee with a certain level of skill and experience can expect to earn from most employers in a given geographic area.
As a hypothetical example, in “Exampletown, USA,” say the average entry-level hourly wage for a basic security officer is $16/hour. This means that job hunters who have little or no experience, looking for basic security jobs with vendors in that town, will likely see most of the available job offers paying around $16/hour to start—that is the town’s market wage for entry-level security officers. To carry the example further, in that same town, more senior security officers—those with 3 to 5 years of experience—earn an average of $18.50/hour. Job-hunting security officers who have that extra experience will find that most of the available jobs offered by security vendors in the town will pay somewhere in that range. Therefore, the market wage for experienced security officers would be $18.50.
In the example above, if your security company pays the entry-level officers assigned to your account only $15/hour, the company will probably struggle to recruit and hire capable candidates. And if they pay their more experienced officers only $17/hour, they may be seeing excessive turnover and repeated resignations—as those more experienced personnel leave for higher-paying jobs elsewhere. Conversely, if the wages being paid by the vendor at your account are higher than the average market wage, your security company may be able to attract and retain more capable and hard-working candidates for your account. Keeping better employees and enduring less turnover typically result in a more successful contract security program.
The Impact of Non-Security Jobs on Security Market Wages
At the entry-level end of the job spectrum, manned security companies must compete with a range of other industries to attract qualified candidates. Security providers, fast food restaurants, janitorial companies, landscaping firms, retail stores, warehouses, and many others hire entry-level candidates with little or no experience—and then provide necessary training for those employees to do their new jobs. Because all of these industries are trying to draw from the same group of potential employees—the local labor pool—the wages they offer will determine how successful they are in hiring.
Anomalies in that local job market, such as a newly-built warehouse hiring staff at higher wages or a restaurant chain that increases all of their new-hire rates, can greatly affect the market wages in a given area.
If the wages paid by your vendor at your account are below market, the security officers trained at your facility could be enticed to leave not only by other security firms who may pay more—but also by local non-security jobs paying higher wages.
You certainly do not want to find yourself in a position where most of the security officers assigned to your account are those who could not get jobs elsewhere at higher-paying opportunities. You also don’t want excessive turnover at your site(s) to create a revolving door of new or poorly-trained personnel who rarely stick around long enough to really learn their duties.
How Much is Your Security Company Paying the Officers?
It is entirely possible that you may not know the wages of security officers assigned to your account. Many times, security companies bidding on new work or responding to an RFP will list the bill rates they plan to charge for each position—without specifying the underlying wages for those positions. Often, the invoices security companies issue for their services also make no mention of wages. After all, these are the security company’s employees, not yours. As long as the bill rates they charge you are correct according to the contract you signed, they may assume you don’t need to know the wages paid.
Of course, if your security vendor is having problems with recruiting, staffing, turnover, or dark hours, those problems could have a direct impact on the quality of service you are receiving. The quality of that service delivery may then have a direct impact on the effectiveness of your security program—and the risks you are trying to mitigate. Knowing what wages the officers assigned to your account are earning—and how those rates compare to market wages—may give you insights into why your program is underperforming.
What Can You Do?
If you don’t know the wages of the officers assigned to your account, you can certainly ask your security provider. They should be willing to provide that information. Of course, you may not know enough about the market wages in your area to make direct comparisons, but you can ask the security company’s representative what they are seeing with respect to competitive security wages in your area.
If your security company declines to provide you with the wages paid to the officers on your account or if their answer seems evasive, you should consider their response a red flag. As a client, you should be able to have a say in ensuring that the security officers assigned to protect your interests are earning competitive wages.
What Can We Do?
Simply put, we partner with you to help you navigate this process. Fine Tune’s experts can perform a sophisticated market wage analysis for your region(s), analyze the existing security wage and bill rate data for your account, and make recommendations. Fine Tune can also re-write and renegotiate contracts on your behalf, run RFPs to select alternative vendors, and help ensure that the security officers assigned to your account are earning market-competitive wages.
After all, a well-managed security program that employs security officers at competitive wages is more likely to be effective at mitigating risks and securing your facilities.