Given the current economic environment and potential for a looming recession (2 down qtrs of declining GDP & the inverted yield curve), will modular construction industries still be able to grow?
It's difficult to predict exactly how the current economic environment and potential for a recession will affect the modular construction industry. The modular construction industry, like any other industry, is subject to the broader economic conditions and can be impacted by a recession. However, Google data shows concern about the looming recession rising month-on-month.
"In the offsite construction industry with regard to volumetric and modular construction we are seeing an increase in the need for multifamily products across the country. The density required for the amount of homes needed is overwhelming. Our clients (Developers | Builders) are interested in 3-5 story wood frame over podium, modular designs", says Audree Grubesic, owner of Modular Sure Site.
During a recession, there may be a decrease in construction spending, as individuals and businesses may be less likely to invest in new construction projects. This could result in a decrease in demand for modular construction services and a decline in the overall size of the industry.
However, the impact of a recession on the modular construction industry could be mitigated by the advantages offered by modular construction, such as speed, quality, and cost savings. Modular construction has the potential to be more cost-effective than traditional on-site construction methods, which could make it more attractive to clients during a period of economic uncertainty.
While that’s not a stage construction is at just yet, the downturn, caused by inflation across the board, has started to seep into the pores. Resilience and having quality products on the shelves will be the difference during this time.
The exact length of time that the current economic environment and potential for a recession will affect the modular construction industry's ability to grow and deliver solid results will depend on a number of factors, including the severity of the recession, the duration of the economic downturn, and the industry's ability to adapt to changing market conditions.
In conclusion, the modular construction industry is likely to be impacted by the current economic environment and potential for a recession, although the exact extent and duration of this impact is difficult to predict.