Can modular construction ease India’s labour crisis?

In construction, delays come with the territory—weather disruptions, permit hurdles, material shortages. But in the last few years, one problem has emerged as a constant: the shortage of skilled on-site labour.

India’s construction sector, which supports housing, infrastructure, and industrial growth, is increasingly strained by this challenge. As traditional site labour becomes harder to source and manage, more firms are turning to modular construction as a potential solution. The question is—how far can it actually go in addressing the crisis?

What modular construction brings to the table

 The modular construction process, including prefabrication, requires factory-based production of wall sections and slabs and complete room modules before assembly at the project site.

The main advantages of this approach include:

•      Reduced dependence on on-site labour
•      Faster project completion
•      Controlled quality and less material waste
•      Lower exposure to weather delays

The advantages of this approach become most significant when working on urban projects that need quick completion and have restricted workforce access. Developers in Pune and Ahmedabad use modular bathroom pods and precast walls to save time and minimise rework.

What the numbers say

According to a 2023 NSDC report, India faces a shortfall of nearly 4 million skilled construction workers. The Construction Skill Development Council of India (CSDCI) also reports that over 80% of the workforce remains informally employed, leading to unpredictable site performance and project delays. In this context, modular construction presents a compelling value proposition, especially for repeatable design projects like housing, hospitals, and student housing.

Early signs of adoption in India

The shift is already underway:

•       In Nagpur, a hospital project that adopted modular patient rooms delivered seven months ahead of schedule.
•       Public infrastructure projects in Delhi NCR have also started integrating precast and prefab elements to reduce construction timelines.
•       Large firms have invested in their own prefab manufacturing units.

It’s not a one-size-fits-all solution

Modular construction sounds great, and it often is, but it’s not perfect or right for every situation. For one, the setup costs can be high. Starting a factory or even partnering with one takes upfront investment.

Then there’s the transport issue—moving large prefab units isn’t easy. You can’t just throw modular into any project and expect it to work. Moving big parts around isn’t simple; you need proper roads and need to plan the whole thing from the start. And the designs? You don’t get as much freedom as you do with regular construction. It works best with the same layout, like flats, dorms, or hospital rooms.

Also, just because it’s made in a factory doesn’t mean it builds itself. You still need people on-site who know what they’re doing to put it all together. For small towns or tricky, one-off projects, the old way still makes more sense. It’s easier, cheaper, and gives you more room to adjust.

The bottom line? Modular works really well in the right projects, but it’s not a magic fix for everything. Like anything else in this business, it needs the right planning and the right context.

How to think about it realistically

Modular should be viewed as part of a broader strategy, not a replacement for all conventional methods. It works best in projects where speed, scale, and standardisation matter. For others, a hybrid approach that blends modular elements with traditional techniques may offer the best of both worlds.

Let’s be real—this labour problem isn’t going away anytime soon. Work is piling up, but the people to do it just aren’t there. So, we’ve got to find smarter ways to build. Modular won’t fix everything, but it’s one option that actually makes sense right now.

Final word: A tool worth considering, not a cure-all

Modular construction has shown that it can help tackle India’s labour challenges, but only when used thoughtfully. It offers speed and reliability in the right scenarios, but comes with its own planning and execution demands. 

As construction professionals, we need to build with both innovation and realism. That means balancing cost, labour, site conditions, and project goals to decide where modular fits—and where it doesn’t. Modular isn’t the only answer, but it’s definitely an answer worth considering.