x Abu Dhabi, UAEThursday 27 July 2017

China's new wealthy on guard

In the globally influential new China, the economic boom has been accompanied by explosive growth in the private security industry.

China's private security industry is booming, with thousands of migrant workers employed as guards on modest wages to patrol outside schools and commercial buildings and protect wealthy individuals.
China's private security industry is booming, with thousands of migrant workers employed as guards on modest wages to patrol outside schools and commercial buildings and protect wealthy individuals.

In the globally influential new China, the economic boom has been accompanied by explosive growth in the private security industry, with those employed as guards outnumbering the country's police officers by about four to one, writes Daniel Bardsley, foreign correspondent

A Walk past the back of the Bank of China's Beijing headquarters and you will always find them there; come rain or shine, clear weather or smog, a handful of security guards will be standing about keeping a check on things.

One is usually guarding an underground car park entrance, two more decide which cars can enter the main area in front of the building, while round the side, shuffling occasionally in huge coats, will be one or two others looking after pedestrian entrances.

It is undemanding, fairly boring work and can be uncomfortable in the freezing winds of the depths of winter.

In modern-day China, guards such as these, employed by private security companies, can be found keeping watch outside and inside almost every major corporate building, along with shopping centres, nightclubs and numerous other venues.

China's private security industry is booming, with the ministry of public security indicating there are 2,767 registered companies in the sector, generating about US$1.2 billion (Dh4.4bn) a year and employing more than 2 million security workers.

While thousands of guards are migrant workers on modest wages employed to patrol outside schools and commercial buildings, China's nouveau riche are also hiring larger numbers of bodyguards.

"Ten years ago, [private security] didn't exist. Now it's pretty massive. The growth has been pretty stunning," says Rod Broadhurst, a professor at the school of regulation, justice and diplomacy in the Australian National University College of Asia and the Pacific, and a former chairman of the Hong Kong Criminology Society.

Crime rates might still be low in China compared with some developed nations, but experts tend to agree - even if reliable data are not always available - that they have risen significantly.

"The growth [in private security] is … associated with concerns about the growth of common crime, particularly crime against business. As urban areas have grown, the floating population has grown. There's been a lot of theft," says Prof Broadhurst.

"There will be a response - and the state feels if you're running a private business and you can't look after your gear, that's your problem."

Major inequalities among China's working population are said to be one reason for the growth of crime. In China, the Gini coefficient, a rating system in which zero represents equal income distribution and a score of one represents the highest wealth disparity, reached what is regarded as the "warning" level of 0.40 a decade ago. It is now believed to be about 0.47, and inequality is a regular topic of discussion among Chinese.

While private security has expanded globally, the expansion of the industry in China has been particularly marked. In Hong Kong, Prof Broadhurst says, there are about four times as many private security guards as there are police officers, greater than the typical proportion for most countries of two to three private security personnel for each officer.

That the industry is lucrative is revealed by the fact that senior officers from China's public security bureau, the government division that controls the police, are retiring and moving into the business, says Prof Broadhurst.

Typical of the security companies that have expanded with the boom in the industry is China City Guard Security, based in Shanghai, with offices in 10 major cities across the country.

Xiao Peng, the company founder and president, says demand for services in some areas is increasing by as much as 200 per cent a year.

"The market is very huge in China. Every enterprise now needs security services," says Mr Xiao, a graduate of the China Criminal Police University whose career began, like many in the industry, in the police force.

Set up in 2005, although it can trace its ultimate origins a further decade back, the company employs 3,000 people and states its annual turnover is about 100 million yuan (Dh55.6m). Major clients have included Porsche, IBM, Intel, Microsoft and the US broadcaster NBC, with which the company was heavily involved during the 2008 Olympics.

China City Guard Security insists its staff are properly trained for the work they do.

However, the Chinese economy's vast labour supply means there are many tens of thousands of people available to work in the industry for low wages and who, some have argued, offer relatively modest security improvements when they are deployed.

Patrick Chovanec, an associate professor of practice at the school of economics and management at Tsinghua University in Beijing, says such "marginal workers" can be found in many service industry sectors such as restaurants.

"There's a lot of very, very low value-added labour going on in the service industry, and the security industry is part of that," he says.

There have been efforts to improve standards, or at least to put the industry on a more formal footing. Last year, after many years during which the industry was said to operate in a legal grey area, regulations came into force allowing companies to offer bodyguards for hire.

Mr Xiao's company has about 100 such "personal protection staff" on its books. While in certain other countries guards are frequently armed, rules restricting the carrying of firearms mean that in China capabilities in martial arts tend to be more common instead.

The money China's bodyguards can earn can be significant, sometimes up to 20 times as much as the migrant workers who guard buildings for a typical salary of about 1,500 yuan a month.

Those taking such personal protection work are usually ex-army or police, although in their new roles observers say they often take on lighter duties as well, frequently working as drivers or secretaries.

Female bodyguards are reportedly especially popular, often earning about 20 per cent more than their male counterparts, as they are seen as being more discreet.

The state-run China Daily newspaper has reported that a female bodyguard called Yu Xiaomei is this week aiming to auction her services for a year at a starting price of 180,000 yuan.

"To be trusted by my clients gives me a sense of achievement," she told the newspaper. "I try my best to help them solve any problems they encounter. It's my greatest reward if they feel safe with me."

 

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