The modular construction industry is not new. It’s not untried, untested, or untrue. It is a relatively small niche of the construction industry accounting for about 5.5% of all new building construction starts in 2021. And it is a somewhat fragmented industry in terms of the geographic locations of the modular factories. That has made it easier for the construction industry power brokers to dismiss and marginalize an entire industry for decades.
Let’s look at some facts:
- The construction industry currently has 500,000 unfilled jobs.
- According to the Bureau of Labor Statistics, 22% of the construction workforce is age 55 or older. Only 9% are age 24 or younger.
- The U.S. is currently facing a seven million shortfall in terms of affordable housing units.
- The American Society of Civil Engineers gave the U.S. a grade of C– on their recent 2021 infrastructure report card. And this was actually an improvement over the D+ grade received in 2017.
- ASCE reports a $2.6 trillion infrastructure investment gap over the next decade.
- As much as 30% of all building materials delivered to a typical construction site can end up as waste.
- McKinsey reported that productivity growth in construction has averaged only 1% a year over the past two decades, compared with growth of 2.8% for the total world economy and 3.6% in manufacturing.
With all due respect status quo, you’re letting us down. And it looks like things are going to get worse! It’s time for some new thinking and innovative solutions to these old problems. I’m certainly not suggesting that modular construction is the panacea for all our construction industry woes. After all, you have stacked the deck against us for the several decades. Every aspect of our construction industry was developed from an in-situ point of view. Insurance, codes, procurement, contracts, design guides, regulations, laws, financing. Everything!
It has taken some time, but the Modular Building Institute (MBI) is starting to change that mind set.
- MBI worked with the National Institute of Building Sciences and the AIA to develop a Design for Modular Construction Guide.
- We worked with AGC and Consensus Docs to develop two new template contracts for prefabrication.
- We worked with the International Code Council to complete two new industry standards, with a third on the way. We also developed the first Guideline for modified shipping containers with the ICC.
- We’ve worked with the Canada Standards Agency to develop new standards.
- We’ve funded research published in Dodge’s 2019 Smart Market Report for Prefabrication.
- We helped develop a Multifamily Modular Construction Toolkit for Fannie Mae lenders.
- We’ve worked with the Canada Mortgage Housing Corporation on their successful Rapid Housing Initiative.
Point is, we bring a lot to the table. And you need to make more room for us because we’re not going away!
Tom Hardiman has served as the Executive Director for the Modular Building Institute (MBI) since 2004. The Modular Building Institute is the international nonprofit trade association serving the commercial modular construction industry for over 35 years. As the Voice of Commercial Modular Construction™, MBI promotes the advantages of modular construction while advocating for the removal of barriers that limit growth opportunities. Through its long-standing relationships with member companies, policy makers, developers, architects, and contractors, MBI has become the trusted source of information for the commercial modular construction industry.