The Recruitment Squeeze Is a Valuation Input Now

Owners tend to think of recruitment as an operational headache rather than a valuation issue. In 2026 it is both. The flow of new people into the licensed security workforce has slowed, and once you follow that through to what a buyer is actually acquiring, it changes what a well-staffed guarding business is worth.

The Pipeline Is Thinning

The headline numbers still look solid. There were 517,144 active SIA licences as at February 2026, held by around 458,000 individuals, with door supervision the largest category at 368,546 licences. But the flow behind those figures tells a different story. First-time SIA licence applications fell around 15.8 per cent year on year, from 94,315 in 2024 to 79,449 in 2025, and the SIA's own business planning projected roughly 75,000 for 2025-26. Fewer new entrants are coming into the sector.

Put plainly, the sector depends more than ever on keeping the people it already has, because fewer new ones are coming in. That sits on top of the cost pressures we looked at separately: officer pay usually at the National Living Wage, and competition for the same people from logistics and retail. When fewer people are coming in and existing staff have alternatives, retention stops being a nice-to-have and becomes the thing that keeps the contracts staffed.

Why This Reaches a Buyer

Here is the part that matters for a sale. When you buy a guarding business, you are not really buying the contracts. You are buying the people who deliver them. If the buyer takes over your company, the staff come with it as they are; if it buys the business's assets, or a contract moves to a new provider, TUPE moves them across on their existing terms. Either way a buyer inherits your workforce along with your customers.

In a market where new entrants are scarce, that inherited workforce is either an asset or a liability. A team with low attrition, current BS 7858 screening records and licence currency across the board lets a buyer keep the contracts running from day one. A book of business propped up by high turnover, agency cover and gaps in vetting hands the buyer a recruitment problem in the exact market where recruitment is hardest. The same contract book is worth more in the first case than the second, because the risk of losing customers after completion is lower.

What to Evidence Before You Sell

The good news is that this is one of the more controllable parts of a business's value. If you want a workforce that reads as an asset, the things a buyer will look for are straightforward to document:

• Staff retention and attrition rates over the last two or three years.
• Current BS 7858 vetting records, clearly held and easy to produce.
• Licence currency across the workforce, with renewals tracked rather than left to lapse.
• How dependent each contract is on specific individuals, and how that risk is managed.

None of this is glamorous, and that is rather the point. A stable, vetted, licensed team is quiet evidence that the business will still deliver after you have gone, which is exactly the reassurance a buyer is paying for. If your retention is strong, put it front and centre before going to market. If it is patchy, it is far better fixed a year ahead of a sale than discovered in due diligence, when a buyer checks the business in detail. The workforce squeeze is one of four forces reshaping security values this autumn, set out in full in our cost stack and value stack briefing.

Nick Hunt leads the work on raising what a business is worth before a sale, from margin to owner dependence, the extent to which the work still leans on you.