Automation may solve a serious housing crisis in Europe and America.
According to the Federal Home Loan Mortgage Corporation, or Freddie Mac, the housing shortage in America is serious. In 2018, the Corporation estimated the US housing shortage to be 2.5 million units, but this shortage grew to 3.8 million units at the end of 2020. The situation in Europe is similar, with German sources forecasting housing supply shortages in 35 cities by 2030. Complicating the shortages are a major problem: labor, more specifically the shortage of skilled trades necessary for home construction. One solution is automation, and robot maker ABB has announced a collaboration with Porsche Consulting to create a pilot project to develop new techniques for modular housing manufacturing. The market is wide open, with construction lagging other engineering sectors in the use of automation.
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Episode Transcript:
According to the Federal Home loan mortgage corporation, or Freddie Mac, the housing shortage in America is serious. In 2018, the Corporation estimated the U.S. housing shortage to be 2.5 million units, but this shortage grew to 3.8 million units at the end of 2020.
The situation in Europe is similar, with German sources forecasting housing supply shortages in 35 cities by 2030. Complicating the shortages are increasingly stringent building codes and regulations that demand energy efficiency and carbon reductions throughout the supply chain.
But the major problem is labor, more specifically the shortage of skilled trades necessary for home construction. One solution is automation, and robot maker ABB has announced a collaboration with Porsche Consulting to create a pilot project to develop new techniques for modular housing manufacturing.
The construction industry is notable for low levels of automation. In a global survey commissioned by ABB of 1,900 American, European and Chinese construction businesses, 55 percent reported that they use some form of automation, compared to 84 percent of auto makers and 79 percent of general manufacturers.
The concept of modular housing is not new, but traditional modular production still requires considerable human labor to pre-fabricate components which are then erected on site. Large-scale 3D printing promises to use materials like concrete to build homes layer by layer, but this technique still requires considerable interior and exterior finishing to create a livable unit.
Factory production has several advantages: it’s unaffected by weather conditions, it’s easier to maintain quality control and the costs, and delays and environmental impact of coordinating the transportation of multiple building materials and services to a site are minimized.
Safety is also a factor. According to ABB, construction accounts for about 30 percent of workplace injuries and construction workers are four times more likely to be involved in a fatal accident versus other sectors.
Factory-built modular housing can create higher quality, lower cost units, but it also suggests interesting possibilities for the single-family dwellings preferred by most Americans. Future homes may be not only modular, but expandable, allowing owners to add a room as families grow, or reduce square footage for empty nesters.
Modularity also suggests the possibility of upgrading home systems such as power, water, windows and insulation replacement of wall and room segments instead of the messy, expensive renovation techniques used today.
And of course, the potential to pick up and move homes in assemblies could create a housing aftermarket where neighbourhoods themselves could expand and contract as demographics demand.
ABB notes that the carbon intensity of building construction may be an important cost consideration going forward, and that its pilot housing factory collaboration with Porsche can keep this new and rising form of construction cost under control.
With the shortage of skilled labor predicted to last to the end of the decade at least, robotic automation may be the key to filling the housing gap with durable units that are also affordable, a critical consideration in an age of rising interest rates.
