Like much of the world, the U.S. economy has been struggling for more than a year. The COVID-19 pandemic has significantly impacted several industries, and the U.S. GDP decreased 3.5 percent in 2020—the biggest drop since 1946. On top of that, the skills gap in the manufacturing industry is increasing due to retiring baby boomers and a low rate of young, skilled workers joining the workforce. The manufacturing industry will have to evolve, and CNC automation can play a vital role in the process.
For several years, there has been increasing talk of “reshoring”—bringing production back from low-wage countries. Reshoring can dramatically reduce the risks companies face in the event of a pandemic. Even though the perspective of bringing production back to the U.S. sounds promising, the growing skills gap poses a big challenge to its feasibility.
My experience in running a job shop for turning and milling work is quite different today than it has been in the past. Those who have walked into a typical machine shop will know that the average age of its staff is often over 50; younger workers are hard to come by as fewer young people are studying technical courses, and many view machine shops as dull, dark environments where hard physical labor is part of the daily routine. Reality, however, is far from that perception. Today’s job shops have become modern companies with state-of-the-art technology, high-tech machines and robotics. And the latter can play a crucial role in closing the growing skills gap.
Why is it that job shops have changed so much, and will continue to do so? In the past 15 to 20 years, job shops all over the country have seen order volumes decline. Their customers no longer want to invest in expensive stocks of spare parts. Rather than ordering large part quantities, these businesses have started to order smaller batch sizes of components they want to be delivered just-in-time. On the other hand, tariffs on international trade have been capped, enabling a global economy. Whereas job shops used to compete with companies directly in their backyards, so to speak, now they suddenly find themselves in a global market.
It is important to understand that today’s supply chain is completely different from what it used to be.
Consider the example of a company that produces tractors. These tractors are sold at dealerships across the country. They are built in only a few factories in the U.S., but those factories do not produce all the individual parts. Some parts are produced by subcontractors, who in turn work with other subcontractors to produce subassemblies or specific turned or milled parts.
Whereas every dealership, factory, subcontractor and subcontractor of a subcontractor used to have several tractors, with spare parts, including turned or milled parts, in stock, they hardly have anything in stock today, simply because it is “dead capital.”
Now imagine that a tractor breaks down and a customer needs a specific part. He will contact his dealer, who will contact the factory, who will contact the subcontractor and so on. If you no longer have anything in stock, then the pressure to produce parts at very short notice becomes extremely high. Companies will request delivery on-site within 48 hours. The further down the supply chain you are, the higher the pressure will be to produce a part in a very short period—and at the same price as 15 years ago, of course, and with even better quality. If you cannot meet these demands and expectations, you may lose the order to a competitor abroad.
The only way for an American company to achieve this is through automation. When an order for a milled part arrives at a job shop, then automation can come into play. An operator can set the robot to produce the order even overnight—without stress for the operator or overtime to be paid by the business owner. But automation can also play another role; robots will become a machinist’s best friend by assuming the hard labor and the dull, repetitive work, freeing up time for more creative tasks, process optimization or training.
In June, we installed what we think are the most high-tech CNC automation solutions in our own job shop, and I am thrilled to see how enthusiastic our machinists are! They already know that a robot will not replace them. These robots do not work by themselves; we need machinists to program the CNC machines as well as the robots. The difference is that now our operators have an assistant. Our machinists have experienced firsthand how easy it is to program a robot. We can set up a new job within five minutes! As a machine shop owner, I owe it to my employees to make their jobs more meaningful and satisfying.
I am convinced that our robots not only help improve the working conditions for our existing staff, but also help attract new, young colleagues. We can show young talent that the reality of working in a job shop is very different from what they believe it to be. The manufacturing industry is a beautiful industry to work in. We owe it to the next generation to improve working conditions through CNC automation and to further improve the attractiveness of our industry for young people considering manufacturing as a career.