Shortly after taking office in January 2021, President Joe Biden directed the Department of Justice not to renew contracts with privately operated criminal detention facilities, noting in an executive order that such facilities “do not maintain the same levels of safety and security for people in the Federal criminal justice system or for correctional staff.”

Four years later, amid a flurry of day-one executive actions, President Donald Trump revoked Biden’s order.  

For-profit prison operators cheered the move. In statements earlier this year, GEO Group Executive Chairman George Zoley said his company expects “unprecedented future growth opportunities and significant operational activity during 2025,” while CoreCivic CEO Damon Hininger said he anticipated “a period of accelerated demand from our federal, state and local government partners.”

The Trump administration’s policy is likely to benefit existing operators with experience in the privately run detention business. But other organizations with experience running complex facilities might benefit, too, if they see the new policy as an opportunity to move into what could be a growth market — and they’re prepared to meet the sector’s unique security, compliance and public-relations considerations. 

An opportunity, but at what scale?

Private prisons account for about 8% of the 1.925 million total U.S. detention beds, according to Prison Policy Initiative data released this month. State facilities represent a majority, or 81,000 of the beds. At the federal level, facilities contracted by Immigration and Customs Enforcement, or ICE, and the Office of Refugee Resettlement account for the largest portion, or 34,000 beds. The Bureau of Prisons and the U.S. Marshalls Service account for the remaining 19,000. 

ICE and the U.S. Marshals Service facilities are designed for short-term stays, said Brian Koehn, founder, president and CEO of not-for-profit corrections operator Social Purpose Corrections. ICE and the Office of Refugee Resettlement typically hold people for a matter of days, then release them for deportation or while their asylum claims are processed, Koehn said.The U.S. Marshals Service typically holds people for about 40 days, often as a precursor to Bureau of Prisons detention while federal courts adjudicate their cases.

BOP facilities tend to support longer stays, with “a full programming component, which you don’t see in a detention setting,” Koehn said. “You get to know the people there.”

If the new administration follows through on the goal to ramp up immigration enforcement, the immigration segment is likely to see the biggest increase in demand because the existing federal detention network would be stretched “way beyond capacity,” Koehn said.

In December, GEO Group said it would invest $70 million to “deliver expanded detention capacity, secure transportation and electronic monitoring services” to ICE, potentially boosting its immigrant detention capacity well beyond the current 21,000 beds the private prison group maintains. Last month, it announced a nearly $1 billion, 15-year contract with ICE to establish an immigration processing center in New Jersey.

Also last month, CoreCivic previewed “$40 million to $45 million of capital investments related to potential facility activations and transportation services.” On March 5, it announced it would resume operations at a South Texas immigration detention facility under a renewed agreement with the federal government.

The expected increase in demand for immigration detention may attract new management organizations to the space as well, Koehn said.

“I’ve been told that people who retired out of immigration [detention careers] are trying to start their own facilities because they see the opportunity,” he said.

Worth the risk?

That opportunity is not as clear as it first appears, some specialists in the industry say.

“If I were to give one piece of advice to a company looking to move into this space, it would be: don't do it,” said Mike Wessler, communications director for the Prison Policy Initiative.

For facilities operators and other service providers not previously involved in the corrections industry, the reputational risk associated with for-profit detention may not be worth any financial upside. Wessler noted that Securus, one of two telecom contractors that together control about 80% of U.S. prison and jail communications, is “on the brink of collapse” following a long public relations campaign by corrections reform advocates.

“Any company jumping into this space will also likely face public backlash that could put other parts of their business … at risk,” he said.

Additionally, federal detention opportunities will likely be confined to the federal network, Wessler said. The Trump executive order is unlikely to reverse longer-term movement away from privately operated jails and prisons at the state level, driven in part by public backlash, he said.

Both New Mexico and Oklahoma, once heavily dependent on privately run detention facilities, have taken significant steps this decade to reduce their reliance on them, Koehn noted.

Staffing is another obstacle for detention facility operators, for-profit or otherwise, Koehn and Wessler said.

In February, thousands of New York state corrections officers staged a wildcat strike, citing dangerous working conditions, excessively long shifts and a new state law restricting the use of solitary confinement. Though the strike officially ended earlier this month, the New York State Department of Corrections and Community Supervision plans to fire around 2,000 employees who refused to return to work, Gothamist reported.

“All of corrections has a major staff retention problem,” Koehn said. “These officers [were] upset for good reason, but they don’t see any relief in sight because the government doesn’t want to fix the problem.”

Koehn, who supervised federal and state detainees during a nearly three-decade career with CoreCivic, pushed back on the idea that privately-run prisons are less humane than government-run facilities. If anything, the reverse is true, he said. But in addition to a duty to prioritize investors over residents and staff, profit-motivated operators do have a “perverse incentive” to focus on “heads and beds” rather than more durable outcomes like reducing recidivism rates, he said. Recidivism in corrections refers to a person’s relapse into criminal behavior, according to the National Institute for Justice. 

Social Purpose Corrections’ not-for-profit, outcomes-based model has the potential to offer more value to contracting agencies, Koehn argued. Though it has yet to land a management contract or open a facility of its own, SPC aims to use financial incentives it receives for meeting agreed-upon outcomes to fund staff bonuses — boosting retention — or fund additional resident programming, he said.

But no matter how pure their operators’ intentions, detention centers are complex facilities that need to be financially sustainable, Koehn said. That’s why some private operators run functions like resident programming, food service and even medical care internally, rather than subcontracting them out.

“When you contract out those services, you lose some control because you’re working with a third-party vendor,” he said. Still, SPC plans to engage “nonprofits and socially responsible for-profits” to help with certain aspects of facility operation, he said.