The Modular Solution to the Construction Labor Shortage

The Modular Solution to the Construction Labor Problem – Industrialization

Currently, the modular industry in the United States accounts for about 3% of all new building and home construction starts, a much lower adoption rate than in other developed nations. In Japan, for example, nearly 20% of all homes are constructed with an industrialized or prefabricated process. Sweden has the highest adoption rate with a whopping 84% of detached homes prefabricated.

There is a major difference between the US (and Canadian) industry compared to other European and Asian countries. In North America, we still CONSTRUCT buildings piece-by-piece, nail-by-nail, site-by-site, with all the variables, conditions, and challenges associated project-by-project. Other countries approach their construction industry with a manufacturing and assembly focus. They think in terms of processes instead of projects with a goal of minimizing waste and inefficienc

The Japanese are experts in lean manufacturing techniques. They used this expertise to “school” the U.S. auto industry in the 1970s-80s. They also transferred their knowledge and best practices from their auto industry to their construction industry. Today, about seven major modular home factories in Japan crank out over 100,000 homes annually. That’s more than the entire U.S. modular home industry. Ironically, the U.S. auto industry DID eventually learn this lesson and now assembles cars made up from components manufactured at other plants. It no longer takes a mechanic to build a car.

Another major difference in adoption rates is that other governments are banking on and supporting industrialization and manufacturing efforts. The U.K. government recently announced a deal with a Chinese company to open six manufacturing plants in the U.K., employing U.K. citizens and building 25,000 housing units for the people of the U.K.

Now, at this point you may be thinking that industrialization of the construction industry would mean FEWER workers needed. Possibly. More accurately it would mean workers with a slightly different skill set are needed.

Japanese modular home manufacturer Sekisui Heim, the house-building segment of the Sekisui Chemical Company, is one of the largest modular home manufacturers in the world. The company employs nearly 4,000 people at their eight manufacturing plants, which produce over 1,000 homes each month. Simple math shows that on average, 4 workers build one home each month.

Many countries are embracing industrialization in part due to difficulty in finding labor, but also due to the high demand for more affordable housing inventory. In the U.S., we currently have:

1. A shortage of skilled construction labor.
2. A shortage of decent, affordable housing inventory.
3. A vastly under-utilized manufacturing base/ infrastructure.
4. A need for more stable, predictable jobs.

The modular industry can offer more predictable work locations and hours, less labor-intensive work, a higher degree of technology integration in the work place, and much safer working conditions.

We can serve as a catalyst for the major rebirth of the US manufacturing base, creating thousands of new jobs while addressing our own massive infrastructure needs. It just makes sense, doesn’t it?

Now, here’s the kicker – if U.S. construction industry and policy makers DO NOT endorse/encourage/ support the industrialization of the construction industry, it will happen anyway with someone else in the driver’s seat. Foreign investment will continue to flow into U.S. construction markets. We can encourage investment in our manufacturing capabilities, or we can keep trying to sell buggy whips, rotary phones, polaroid film, and beta max movies.

Training Program Provides Skills and Credentials for Industry

TRAMCON (TRAining for Manufactured CONstruction) is a $10M grant-funded program through the U.S. Department of Labor. TRAMCON is a consortium of 4 Florida colleges (Miami Dade College, Santa Fe College, Polk State College, and Seminole State College) selected to provide a tuition-free training program in manufactured construction.

The program combines curriculum developed by the University of Florida, National Center for Construction Education and Research (NCCER), and the Manufacturing Skill Standards Council (MSSC) to create a standardized model for manufactured construction. TRAMCON is designed for participants to gain stackable qualifications which consist of up to seven credentials and certifications (OSHA, MSSC, 3 NCCER Credentials, Fork Lift, and Aerial Platform certifications).

The purpose for the development of the TRAMCON program is to provide training for the manufactured construction industry in order to increase productivity and reduce turnover of employees through training and education. To date, the consortium has 1,744 participants, 1,356 completers, and 1,687 certificates earned.

Santa Fe College has had amazing success stories with these participants. One participant who had been unemployed for quite some time completed the foundation level of training and was placed in a job in a local woodworking shop. He continued the TRAMCON program and completed Basic and Advanced Levels while working fulltime. Another participant came in as an unemployed veteran. He had previous construction experience, but had no credentials or certification to show for it. He completed the foundation level of training and gained employment with a local company that manufactures and builds theme park attractions and decorations. He has since been promoted from his original position and loves his job!

The program is currently in the wind-down stages of training and will end on March 31, 2018. The participating schools are now looking for ways to assist employers and industry leaders in educating and training employees in manufactured construction. Over the past two and half years using the TRAMCON model, the program administrators have a good idea of best practices, what works, and how to best deliver manufactured construction training. The goal is to see TRAMCON continue as either a short training program, a pre-apprenticeship model, or a full apprenticeship model.

If you are interested in learning more about this program, contact MBI for program details.

This article originally appeared in the Modular Advantage Magazine - First Quarter 2018 released in February 2018.