Public Safety Multi-Year Tailwinds Ahead
With rising crime, increased scrutiny is falling on police response. Given recent impacts from heavily publicized events, staffing challenges at police departments, and increased public safety spending via state/municipal/federal sources, technology-enabled solutions have strong potential to improve public safety.
Addressing crime has become a national priority for the Biden administration. Murder and aggravated assaults increased in 2020/2021, well ahead of most industry expectations given the quarantine and lockdowns. As a response, state/municipal budgets have been showing significant growth in 2022.
Current state and municipal spending levels are up, and spending allocated to public safety could surpass that last year's levels. Spending on multiple elements of public safety is up too. 16 of 23 major U.S. cities increased their police budgets in FY22, partially (or entirely in some cases) restoring their prior cuts in FY21, recouping funds for public safety budgets.
American Rescue Plan Act (ARPA) funds have allowed states to benefit from $350B of additional funding for their budgets/operations. Many of the projects or spending that has been executed against those funds have gone mainly to big-ticket items that are not public safety related. However, given these funds have primarily been allocated toward big-ticket items, we believe this has freed up earmarked funds that could be repurposed for public safety upgrades and enhancements, providing another tailwind to the public safety industry.
Police departments are struggling to maintain full staffing owing to recruiting challenges and after some high-profile events. According to the May 2021 National Employment and Wage Estimates conducted by the Bureau of Labor Statistics, in 2020, the number of police officers employed nationwide declined by 1.6% for the first time in a decade. Given the reduced number of officers in the field, we believe technology is an essential element for addressing increasing criminal activity.