Examining the Structure and Dynamics of the Modular Housing Construction Industry

Overview and Background

In recent years, the modular construction industry has made significant advances that qualify it as a more efficient, environmentally friendly, and economical alternative for delivering building projects. In this industry, buildings or portions of buildings are manufactured in off-site manufacturing locations. Once they are manufactured, the buildings are transported to the site where they are erected in the designated configuration. Despite being a sizable industry, there is no comprehensive understanding of the structure as well as the growth dynamics of the modular construction industry that is vital for forecasting its future performance trends. This paper will delve into examining the trends and dynamics of the modular construction industry.

When it comes to productivity gains and operations efficiency, the construction industry is lacking behind other industries. This is due to a number of factors, such as the slow adoption of information technology (IT), slow adoption of operations innovation, and internal waste factors, which include labor coordination and material management, which result in a significant percent waste (Tulacz et al., 2007). Various stakeholders are proposing possible options for advancing the competitiveness and productivity of this industry in the United States. 

Research and professional reports report that modular housing can improve construction efficiency and make modular housing affordable. According to a study conducted by McGraw Hill Construction (MHC) (2011), in the United States, modular housing heled 66 percent, 65 percent, and 77 percent of the respondents shorten their schedule durations, project costs, and construction waste respectively. Similar reports conducted in other countries, such the England and Australia, report additional benefits of improved quality and safer site conditions. 

This research study delves into examining the modular construction industry. More specifically, the paper will examine the structure and growth of this industry. The findings of this research will be useful in developing future advanced models. This will, in turn, help in the design of efficient policies and measures to support the growth of the modular housing construction industry. 

Search Strategy 

A comprehensive search strategy was developed for one database, namely, Google Scholar. Pure-reviewed journals and research papers were used in this study. The search was restricted to literature developed between 2007 and 2020. Research studies preceding 2007 were ignored. Keywords were used for literature research. Some of the keywords that were used include the structure and dynamics of modular housing. Modular housing and modular construction industry were used interchangeably so as not to miss out on literature that used the phrase modular construction industry. The sources used in the research are reliable because I employed the Critical Appraisal Skills Programme (CASP) checklist to test the reliability of the sources. The CASP tool help check for the validity and reliability of sources. Sources that are valid and reliable were used. When searching for the sources, I did not develop any problem with my findings, and therefore I did not have to modify my research topic. 

Table 1: Search Table

Assessment 

Development of Modular Housing 

Modular housing was in the interest of various stakeholders to examine and study efficient, environmentally friendly, and cost-effective building systems. Different programs were developed, such as the Partnership for Advancing Technology in Housing (PATH) with the aim of improving modular housing. PATH collaborated with other programs to sponsor and publish research studies that investigated three main topics, namely, (I) innovative building materials and systems; (II) innovative techniques of construction industrialization to improve the efficiency of modular building fabrication; and (III) public perception of modular housing (U.S. Department of Housing and Urban Development (US-HUD), 2007). 

Supply Chain and Logistics 

The modular housing construction industry is composed of a number of stakeholders, namely, customers, manufacturers, dealers, integrated companies, suppliers, architects/engineers, constrictors, and local permit agencies. These stakeholders or participants interact through the supply chain of modular buildings. Since modular houses are constructed off-site, many logistics are involved, and this poses many challenges. To improve the efficiency of this industry, there is a need to move the majority of construction work from multiple manufacturing sites to a single one. This will help address the issue of vehicular traffic and transportation system disruption. 

Economics and Regulations 

Despite the fact that the modular construction industry is not regulated, it still offers significant financial benefits to investors and owners. According to the U.S. Department of Housing and Urban Development (US-HUD) (2011), many states have weak statues to protect and promote this industry. In addition, some regulations constitute barriers against the construction of modular houses. This includes barriers pertaining to permits, fees, and zoning. However, in recent years, modular housing has started to be considered as a financially viable option. This is because they are more efficient, greener, and affordable compared to stick-built approach (Modular Building Institute, 2012). Conclusively, research has shown that modular housing is more efficient, greener, and affordable. 

References

McGraw Hill Construction (MHC). (2011). Prefabrication and modularization: Increasing productivity in the construction industry. Smart Market, McGraw Hill Construction. 

Modular Building Institute (MBI). (2012). Improving construction efficiency & productivity with modular construction. Report prepared by the Modular Building Institute, Charlottesville, VA. 

Tulacz, G., & Armistead, T. (2007). Top owner –large corporations are attempting to meet the industry halfway on issues of staff shortages and risk. Engineering News-Record. 

U.S. Department of Housing and Urban Development (US-HUD). (2007). Pilot study. Applying lean principles to factory home building. Office of Public Development and Research, Prepared by Manufactured Housing Research Alliance, New York, N.Y. 

U.S. Department of Housing and Urban Development (US-HUD). (2011). Regulatory barriers to manufactured housing placement in urban communities. Office of Policy Development and Research, Prepared by Center for Housing Research, Blacksburg, VA.