Baumol’s Cost Disease means construction labor cost rises faster than productivity. We’re allergic to prefab construction - banks and insurance companies block it. A lot of construction workers left the industry after 2007. Baby Boomers are retiring and told their kids to not get a blue collar job. New housing has to be ADA compliant. People expect to give each kid their own bedroom and have two car garage instead of one car or no garage at all. Recent immigration crackdowns and trade wars are the icing on the cake.
> Baumol’s Cost Disease means construction labor cost rises faster than productivity
Baumol’s applies to jobs that “experienced little or no increase in labor productivity.” I’m arguing there may be extraneous causes for construction’s productivity stasis.
there are! Land use code. And permitting. Municipal processes for permitting housing have stifled any really serious innovation in construction.
you know why we don't have modular, factory built apartment buildings? Not at scale? Because the municipalities won't permit them. and the real reason they won't permit them is because it would put all their inspectors out of business if you didn't have to do any walls open inspections because it was all built in a factory...