Workplace

Pimps Are Just Middle Managers: Lessons From the Underground Sex Economy


The Urban Institute’s sex industry study is one of the most comprehensive surveys ever done of the business of the commercial sex business, including massage parlors, brothels, escort services, and old-fashioned prostitution. Researcher Meredith Dank and a group of colleagues focused on eight U.S. cities—Atlanta, Denver, Dallas, Kansas City, Miami, Seattle, San Diego, and Washington—and conducted interviews with pimps, prostitutes (focusing on females, it would seem), and pornographers in an attempt to untangle one of the oldest underground economies in existence. The results are fascinating.

Atlanta and Miami have the largest underground sex economies of the cities studied, estimated as of 2007 at $290 million and $235 million, respectively. As in most above-ground businesses, the bosses tend to be men. Researchers interviewed 73 pimps who described finding their female employees at high schools, on college campuses, and at malls, nightclubs, and strip bars, as well as through social media. The pimps tend to seek out white women—the younger the better, although not so young that they get into legal trouble for trafficking in minors.

Just as with office life for executives at Fortune 500 companies, management takes up a significant amount of the pimps’ time. “To run a successful sex business requires recruiting, job training, marketing, setting prices, arranging date details, providing transportation if necessary, protecting the staff, collecting and managing money, and seeing to the needs of the employees,” the report explains.

The business model requires that the women hand over all their earnings to their bosses, who then purportedly take care of their material needs and safety. In Atlanta, the pimps brought in an average of $32,833 per week. Many have rules about whom the women can consort with, how much money they’re expected to earn each day, whom they’re allowed to talk to, and what they can consume. Not surprisingly, 58 percent of those working as prostitutes have been victims of violence, according to the survey, and 36 percent said they had confronted violence from customers.

Like other businesses, digital disruption is upending the industry. ”[O]ld-school marketing methods—ads in the phone book, local newspapers, alternative lifestyle publications, and business cards—are still in use, but they are ceding more and more ground to online mediums,” the researchers found. Almost half the pimps said they used online classified ads, social media, chat rooms, and dating websites to attract new customers, with technology gradually making actual street-walking obsolete.

As other industries have learned, often to painful effect, this vast new marketplace comes with such trade-offs as the fact that an expanding market comes with potential for unlimited supply, which over time is likely to drive down prices. As the study concludes: “The spatial limitations that once governed the underground commercial sex economy are gone.”

Kolhatkar_190
Kolhatkar is a features editor and national correspondent for Bloomberg Businessweek. Follow her on Twitter @Sheelahk.

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