Monday, September 26, 2016

Modular Construction Could be the Answer to America's Housing Labor Shortage

Potential construction projects are everywhere but site-built contractors cannot take on some jobs simply because they can't find enough people to swing hammers.

The shortage of skilled trades workers is a national issue. The term "skilled trades" includes the various jobs that require training and contribute to the construction industry — masons, bricklayers, electricians, plumbers, painters, carpenters, roofers and heating/cooling (HVAC) workers. All are in varying degrees of short supply across the nation.

More than half — 54 percent — of the nearly 1,500 survey respondent builders across the country expect it will continue to be difficult to find and hire skilled tradesmen through the next 12 months. An additional 21 percent expect it will become more difficult.

Attitudes are even more pessimistic in the Midwest, where 57 percent of survey respondents believe the situation will remain difficult and 25 percent think it will get worse.

Skilled trades positions are available because construction — both residential and commercial — is booming in most regions nationwide. A generation of skilled trades workers are aging out of the workforce, leaving a gap between plenty of work and not enough workers.

Young people who in past generations might have sought careers in the skilled trades have instead followed the crowd into higher education. College enrollment has swelled in recent decades. The ranks of 20-somethings entering the skilled trades have been shrinking.

Adding to the problems are lack of vocational training, fewer skilled legal immigrant workers available and increased drug testing. Plus young people are not drawn to the trades like the Boomers were during the 60’s and 70’s.

The shortage of skilled workers has driven some contractors to hire laborers with no construction experience, people who require on-the-job training and simply can't work as fast.

The worker pinch has resulted in a 1-2-3 punch to home buyers. They typically need to wait before their project can begin, the work itself can take longer and the tight labor market has driven up prices.

One obvious solution would be for more site-builders to consider having at least some of their homes and projects done by modular factories. The actual number of new modular home and commercial factories has not kept pace with the demand however.

Industry experts believe the long-term solution to the worker shortage is to attract more interest among high school students.


Unknown said...

As someone who is on the forefront of this issue for a larger home builder, the labor market is indeed what is beginning to keep us up at night, at least those of us who are paying attention. We rely on an aging workforce that's replacement rate of younger workers is staggeringly low, regardless of pay. There is a nice living to be made right now for young folks who are willing to work with their hands, and either no one is pushing this sentiment in schools or the kids are not interested. My thoughts are both and neither will change anytime soon.

Site built homes that are affordable, have a reckoning in the next decade as the prices needed to pay for the limited skilled labor, will surely out pace the general public's ability to purchase. Higher density, the current solution, will only take the industry so far. In my mind modular, in some form or fashion will need to play a part if not become the solution. To what end, I can't not say, as with most things in life we only know what we know and not always what you know. There is a big gap in the worlds of site built, both custom and production, in most areas of the country, and a general lack of knowledge of either business models and operations.

With that rant over, but would like to continue the conversation, I am wondering aloud if there is an on-forum somewhere out there, or a possible enhancement to this wonderful website, where folks of different strokes can have a sane, ongoing conversation about this topic and others that pertain to this industry and it's future, in a professional manor? If there is, I would love to be a part of it, if not, should one be created? Just a thought....

Anonymous said...

I am a modular home builder in NY and neither my Millennial son nor daughter want to join my company in any capacity. I paid for their college education only to have one work at Starbucks and the other helping to run a day care for senior citizens. Even though I am proud of both of them, I now have nobody to take over when I decide to quit building houses.

When I asked them why they wouldn't join me in keeping the business going, they both replied that building houses was what uneducated people do when they can't find work. This shocked me.