As the market steadily grows, these corporations have been expanding their prison business at a furious clip. By 1997, bed capacity reached 105,000 in 157 facilities. Sold on promises of cutting expenses by 15 to 20 percent, public officials have eagerly signed long-term contracts that hand over responsibilities of guarding, feeding and rehabilitating their convicted citizens. The prison business exploits its competitive edge by taking advantage of flexibility, says Susan Hart, CCA's vice president of communications. While rules and purchasing procedures thwart efficiency in the public sector, private firms can always nail down the best deal for supplies and construction.
Private guards take home lower wages, although they frequently get stock ownership plans.
There are few unions, and some companies avoid providing the generous benefit plans state workers are accustomed to. Wackenhut was founded in 1954 by former FBI official George Wackenhut, this diversified private security firm first entered the prison business in 1987 when it opened a 250-bed Immigration and Naturalization Service detention center. The company also operates prisons in Australia and other nations. Wackenhut Corrections Corp. High technology also cuts labor costs. Video cameras, infrared security systems and heat detectors reduce the need for guards who now sit at centralized command posts where they can open and close gates simply by touching a computer screen.