Private companies that operate prisons in the US expect a windfall of profits amid a “flood of detention and deportation” as the authorities put into action a crackdown against undocumented migrants.

While human rights advocates have expressed concerns about sweeping deportations, the private sector that is set to make money by detaining the migrants is salivating at the prospect of potential gains.

“I’ve worked at CoreCivic for 32 years, and this is truly one of the most exciting periods in my career with the company,” said Damon Hininger, the CEO of CoreCivic, a private-sector firm that operates detention facilities in partnership with US government agencies like the Immigration and Customs Enforcement (ICE) and the US Marshal Service.

CoreCivic is a market leader in the $4-billion-a-year industry that houses criminals as well as undocumented migrants in privately owned and operated detention centres across the US.

The role of private prisons has come under the spotlight after the election of Trump, who has ordered a large number of executive actions to clamp down on illegal immigration.

The private prison business is thriving as government bodies like ICE catch undocumented migrants and send them to detention centres located mainly in southern US states before their eventual deportation.

There were roughly 11.7 million undocumented people living in the US in 2023, slightly down from a peak of 12 million recorded in 2008. ICE estimates that the new law will create demand for 60,000 to 110,000 additional detention beds.

In addition to undocumented migrants, private prisons hold up to eight percent of the total US state and federal prison population.

Speaking to analysts last week after announcing an unexpectedly high annual profit, Hininger said he expected “perhaps the most significant growth” in the company’s history over the next several years.

President Joe Biden (2021-25) had put a stop to contracts between the Department of Justice and private detention centres, a move that Trump reversed on the first day of his second presidency.

“The change in presidential administration on January 20th has ushered in significant policy and legislative changes that directly impact our business,” Hininger said.

Among the slew of executive orders that Trump issued after his inauguration last month was the declaration of a national emergency on the southern border with Mexico.

In the executive order titled Protecting the American People Against Invasion, the president directed the federal government to “faithfully” execute the immigration laws, including the removal of “aliens”.

The presidential order called on the secretary of homeland security to establish contracts for facilities to “detain removable aliens”—a boon to for-profit prisons where illegal migrants caught by ICE and the US Marshal Service are detained pending their ultimate deportation.

CoreCivic plans to spend up to $45 million in 2025 to expand its prisons, even though it has signed no new contracts after Trump’s return to the White House. The investment will prepare the company to “quickly accept residential populations if opportunities arise”.

Hininger also referred to the Laken Riley Act – the first legislation of the current Congress that was signed into law by Trump on January 29 – as one of the key reasons for the expected swell in the number of people locked up in private prisons.

The new legislation requires law enforcement agencies to detain non-US nationals who have been accused of crimes as petty as shoplifting.

CoreCivic has already put a proposal to ICE to hold an extra 28,000 people, Hininger said.

Making billions off undocumented migrants

In the first term of Trump (2017-21), the number of immigrants detained in private detention facilities grew to a record high, according to a 2019 report by the Sentencing Project.

Many Democratic lawmakers have called for a permanent end to the federal government’s use of private prisons because of inadequate oversight in private facilities, resulting in underreported health and safety violations.

Stories abound of scrimping by prison operators, with bad food and shabby health care for inmates, low pay and inadequate training for guards and hiring shortages.

However, private companies like CoreCivic insist that their detention centres are more efficient and less costly than their public-sector counterparts.

John Sandweg, a former acting director of ICE, said he expects the Trump administration to offer “massive contracts” to the major players in the private prison industry. “(Trump) is going to rely heavily on them,” Sandweg told ABC News.

“Those private contractors are going to make billions, legitimate billions off this.”

The market value of private prison firms soared immediately after Trump’s re-election. The share price of CoreCivic, for example, has gained more than 42 percent since the first week of November.

Similarly, the market value of the GEO Group, the largest private prison company in the US, has nearly doubled since the election of Trump.

GEO Group, which donated $1 million to the election campaign of Trump, previously employed Attorney General Pam Bondi as a lobbyist.

Geo Group Executive Chairman George Zoley said that Trump’s deportation plans represent a “potential sea change” for the private prison industry.

The company expects to make an additional $400 million annually by meeting the “future needs for ICE and the federal government”.

“The Geo Group was built for this unique moment in our history and the opportunities that it will bring,” Zoley said.