Physical Security Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Physical Security Market is projected to expand from USD 130.86 Billion in 2025 to USD 183.85 Billion by 2031, registering a CAGR of 5.83%. This sector encompasses a range of integrated systems and operational protocols, including video surveillance, access control, and perimeter reinforcement, designed to defend assets, facilities, and personnel against physical intrusions or unauthorized entry. Key factors fueling this growth include the necessity to secure critical infrastructure, the ongoing expansion of urban areas necessitating sophisticated monitoring, and strict regulatory requirements for workplace safety. As evidence of this strong demand, the Security Industry Association reported that in 2025, 76% of industry executives rated current business conditions as either good or excellent.

Despite this positive outlook, the market faces a substantial obstacle in the form of a severe scarcity of skilled technical workers needed to implement increasingly intricate, network-enabled security systems. This talent deficit constrains the ability of service providers to effectively handle large-scale projects and consequently increases implementation costs for customers. Ultimately, the inability to expand the workforce at a rate matching technological advancements threatens to hinder broader market expansion and slow the uptake of modern security infrastructures.

Market Drivers

The incorporation of artificial intelligence and machine learning is revolutionizing the Global Physical Security Market by converting systems from simple recording devices into tools for proactive threat mitigation. Contemporary surveillance frameworks leverage these innovations to automate the detection of anomalies, recognize behavioral patterns, and significantly decrease false alarm rates, thereby boosting operational efficacy. This evolution is spurring substantial activity among manufacturers who are prioritizing intelligence features to satisfy changing customer needs; the Security Industry Association’s '2025 Security Megatrends' report from December 2024 notes that 91% of security developers described their R&D investments as being fully or significantly oriented toward AI.

At the same time, the widespread adoption of cloud-based security offerings, such as Video Surveillance as a Service (VSaaS) and Access Control as a Service (ACaaS), is offering the scalability and remote management power needed to modernize infrastructure. Enterprises are increasingly favoring hybrid architectures that combine the stability of on-premises hardware with cloud flexibility, facilitating centralized management and cost-efficient growth. According to Genetec’s 'State of Physical Security 2025' report from December 2024, 43% of end users plan to utilize hybrid models within five years, signaling a shift away from legacy systems. This transition also fosters closer departmental cooperation, with Genetec noting that 77% of end users reported collaboration between their physical security and IT teams.

Market Challenges

A critical shortage of qualified technical labor creates a major bottleneck that limits the revenue potential and scalability of the Global Physical Security Market. As security systems evolve from standalone devices to sophisticated, network-integrated ecosystems, the skills required for installation and maintenance have changed significantly. Service providers struggle to fulfill large-scale deployments due to a lack of personnel possessing the necessary dual expertise in IT networking and physical hardware. This scarcity results in substantial project backlogs, compelling end-users to postpone essential upgrades and preventing the market from fully satisfying the current demand for advanced security solutions.

Additionally, this skills gap fosters an inflationary environment that suppresses wider market adoption. To attract the limited pool of technical talent, integration firms must offer higher wages, costs that are ultimately passed down to the client, thereby raising the total cost of ownership for security initiatives. The Foundation for Advancing Security Talent reported in 2024 that 70% of system integrators cited technician positions as the most challenging to fill, underscoring the gravity of this workforce issue. Consequently, the inability to match workforce capacity with technological progress limits industry growth, as the financial capital available for projects exceeds the technical capacity to execute them.

Market Trends

The shift toward mobile access control and digital credentials is steadily displacing traditional physical badges, fueled by the widespread use of smartphones and the need for enhanced security assurance. Organizations are utilizing Near Field Communication and Bluetooth Low Energy protocols to issue credentials remotely, removing the logistical challenges of printing cards and reducing risks related to stolen or lost badges. This movement signifies a fundamental transition toward touchless, interoperable environments that integrate smoothly with broader enterprise identity platforms. As per HID Global’s '2024 State of the Security Industry Report' from March 2024, nearly 80% of end-user organizations anticipate deploying mobile IDs within the next five years, highlighting a major pivot toward dematerialized access methods.

Concurrently, the market is experiencing a marked emphasis on energy-efficient and sustainable security solutions, driven by corporate Environmental, Social, and Governance (ESG) requirements. Manufacturers are redesigning hardware to lower power usage and utilizing recycled materials, while end-users are increasingly selecting vendors that help reduce the carbon footprint linked to massive data storage and surveillance operations. This alignment forces the industry to innovate beyond mere performance, making environmental impact a key value proposition in hardware procurement. Honeywell’s '2024 Impact Report' from October 2024 reveals that over 60% of their new product R&D investment focused on sustainability, reflecting the supply side’s commitment to environmentally responsible technology.

Key Players Profiled in the Physical Security Market

• Johnson Controls International PLC
• Honeywell International Inc.
• Bosch Security Systems
• Assa Abloy AB
• Tyco International PLC
• Canon Inc.
• Hikvision Digital Technology Co., Ltd.
• Dahua Technology Co., Ltd.
• Axis Communications AB
• FLIR Systems, Inc.

Report Scope

In this report, the Global Physical Security Market has been segmented into the following categories:

Physical Security Market, by Systems Type:

• Physical Access System
• Video Surveillance System
• Perimeter Intrusion and Detection
• Physical Security Information Management
• Others

Physical Security Market, by Service Type:

• Access Control as a Service
• Video Surveillance as a Service
• Remote Monitoring Services
• Security Systems Integration Services
• Others

Physical Security Market, by Enterprise Size:

• Large Enterprises
• SMEs

Physical Security Market, by Industry Vertical:

• BFSI
• Government
• Retail
• Transportation
• Residential
• IT and Telecom
• Others

Physical Security Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Physical Security Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

This product will be delivered within 1-3 business days.