Celebrate the hard-working class even if robots are coming!

Will:
All right, everybody. We are back with another episode of Safety Stock. I’m Will Davis. This is Dan Magida. Dan, we are back. How does it feel?

Dan:
Feels great. You know, we’re we can finally get our joke out of the way that summer is here that we’ve been doing for a while. We can now say almost autumn is here. Fall is here. I don’t know which way you side there are you an autumn order or a fall order. Water is not even a word,

Will:
Greater Philadelphia education, really paying off there. I think that I am a fall person. I think people who use autumn have like a vendetta against fall. And I don’t know why,

Dan:
You know what I’m gonna, I, I usually say fall, but now, because of that, I’m gonna transition to autumn. It just sounds so much so poetic when you say, yeah, autumn is here.

Will:
It is. But you should fall into what you’re doing fall into love, fall into fall. You know, we’re about to fall into Dan, a great supply chain topic.

Dan:
Of course we are.

Will:
Dan, I’m gonna paint a picture for you.

Dan:
It’s Bob Ross, this for me.

Will:
All right, here we go. Bob Ross, this it’s 2028.

Dan:
Oh boy.

Will:
You are searching for a supplier. And when you’re looking for the supplier, you go to their factory and instead of seeing line workers, it’s almost all robots. What’s your first thought?

Dan:
My first thought’s gonna be that there’s gonna be a sign in front that says no accidents for the last X number of days. That’s a go that the stick. Yeah. Yeah. Unless the robots just turn on each other and just mut me everywhere. No, I think there’s gonna be, I, I think it’s great that there’s we already see it in certain industries and factors stay with robots. High speed automation. I think it’s here. It’s coming. We need to fully embrace it. It’s gonna be a tough transition, but it’s an exciting time for robots and factors. How about yourself? Yeah,

Will:
I, for sure. And I think the, the Genesis with article and what we’re talking about is people today think supply chain is broken and a lot of supply chains are broken. And from the New York times article, their thought is that the robots are supposed to help fix it. I think we’re talking about a pretty big issue here overall, when we, you see the labor force numbers and the job openings today, I think we’re like around 3.7% and there’s a lot of open positions out there and factories and people producing goods are really making decisions at this point in time. And they’re betting, are they actually thinking that they’re going to see an increased labor pool or people to come back and do some of these jobs that historically they are struggling to fill in the past two to three years or, you know, do they think that this is gonna be a long term issue and people just aren’t gonna come back and do it. And that is where people are investing. And they’re saying if they don’t think people are coming back, or if they think that they can take people off the line, they’re doing it. And robotics is where they’re putting their money.

Dan:
I mean, we we’ve, I’ve seen it firsthand. And I don’t know if will, if you’ve been, but when, when China, once this factory, there were two people in the factory, it was fully autonomous on the ground. It was IM look and it was the cleanest factory. I’ve ever seen two people, one guy in a control tower. And then the custodian member on the ground just sweeping the floors just to pick up like the residue, but it was full speed, even when it was even when the packout was automated, just type in where it’s going and the, the forklift, it just takes it to the, to the area. So that’s stuff it already exists out there. In terms of the automation, that car industry, like those parts are fully autonomous machines that are making now there’s humans that are selling the line monitoring things. I think there’s still gonna be an element of both out there, humans plus robots, but what does that bleed over to, I guess we’ll find out.

Will:
Yeah, I think, you know, when you go to larger factories today, you know, for the most part, you know, there’s automation everywhere. It just depends on how much of the process is automated, where you start, you know, getting differences is when you go more to the mom and pop and the smaller businesses, not necessarily the gargantuans that are doing, you know, 500 million plus in revenue, but the smaller businesses and what they’re trying to decide in terms of their line. So if a big guy has 12 or 15 production lines, and the smaller business has three production lines, and they typically are using labor in every place that they can’t automate. Are those people now starting to make the decision about, are they taking those people off the line where the people who have the most advantage are the ones that are like, well capitalized, can they make the investment and say, I’m going to invest 150, $160,000 to remove four people off the line.

Will:
And I expect to make that money back within a year. Do I have enough business to make that type of investment? And I think Dan, what we’re seeing more and more is people are going and taking the plunge. And they’re saying, let’s do it. I, people don’t necessarily want these jobs because they’re not as glamorous. You know, the article goes and talks about truck driving truck. Driving’s a difficult job. You know, we’ve talked about it beforehand and, you know, taking along, you know, route all the way from California to Ohio, or if you’re going from Texas up to, you know, Minnesota, it it’s, you know, it’s a grueling job. It takes a lot out of you. And so people are looking for jobs where they may not be doing that. And until the pay catches up to the point to where you’re going to take care of that, a lot of people are saying, I’m just gonna invest in robotics where I can and make up for that lack of labor.

Dan:
Yeah. And, and the one argument on the, like the robots and the like the warehouses is like robots won’t call in sick. I would say like, sure, obviously, like they’re not gonna get sick, but those warehouse workers they’ve been going into the office nonstop since the start of the pandemic. Cause they’ve been like essential workers. So they’ve been making a sacrifice going in. And even with the gas prices going up, they’re still making the commute because they need the money to, for their families to, to survive on. But on your point on like trucking, which I think is like interesting, this whole debate over like the great supply chain disruption, like result of labor shortages, like one side of the one side of the coin says like, yeah, port’s over overwhelmed. Retail shelves are short of goods because the supply chains right now, people willing to drive trucks and to move goods through warehouses.

Dan:
The flip side of that, and this is from a economic sociologists at university of Pennsylvania, Steve Elli, sorry, if I pronounce your last name wrong, who writes, there’s no shorts of truck drivers. They’re just really bad jobs. Now. I’m not gonna debate the merit of it. I think that there’s a lot of ways that you incentivize truck drivers, what some companies are doing these days through like a gamification system where they’re incentivized to drive and get on there, but there should be no shame in any in truck driving at all. It’s an essential part of the American economy to transport the goods across and, and these people, they should be rewarded for it. And there’s gotta be probably better education where like, you know, what if you’ll need, I guess this is an educational problem, which we’re not gonna do a Dan solo where we’re just gonna riff on here, but the whole part where like, you don’t have to be a tech executive, you don’t have to be a doctor or lawyer. There’s nothing wrong with these jobs that still contribute to everyday society from carpentry to plumbing or truck driving. Like there are essential jobs and there should be a greater focus on this through trade for younger people who don’t want to go to college, but still you can still have a great life and a meaningful contribution to the economy and society. I riffed a little bit, but

Will:
No, totally fine. I, Dan you’re right. And I think, you know, a lot of this ultimately comes down to like a stigma and you know, when it comes

Dan:
To unfair stigma,

Will:
Yeah. It’s an unfair stigma. And it’s also, you know, a lot of times, like if people haven’t been into facilities, you know, people may have outdated thoughts about what things look like now. And the differences in terms of like what a production facility looks like today, or, you know, the trucks that are being driven today or whatever may be just may be outdated. And you know, you don’t see a lot of press, you don’t see a lot of things meant to counteract some of this outside of people just say, Hey, help wanted, you know, we pay X amount.

Dan:
Yeah. It’s not like driverless trucks. Like this goes on and say like, they’re coming, they’re doing this. Like one of these companies is gonna start doing this between Walmart, Walmart stores and Texas, Louisiana and, and Arkansas. But like, there’s a whole infrastructure there as well. Like, okay, they’re driverless, but someone’s need to control them too. I guess you can call it similar to like the drones are out there. So it’s, it’s like gaming, but our roadways, like, I don’t know if I trust a driverless truck on a windy road just yet. Like, you gotta be pretty attentive out there, but then you can go into this whole debate. Like if it’s driver, are you gonna be EV do we have the grid and all this stuff, another rift by Dan today? So there’s just a, there’s just a lot that robots, I guess go back to the main point can contribute to automation and getting your costs down, which I think is a key driver. But even with that, it’s gonna be a financial, it’s gonna be financially expensive for these factories to do that. And they’re gonna pass the cost of the consumer. So are those costs gonna outweigh the labor, the rising labor cost? I don’t know, by 2028, I have no idea.

Will:
Yeah. I mean, I think that’s the interesting thing and you’ll see, continue to see like where people can be autonomous and, you know, also, you know, there has to be some flexibility in order to do things. And typically that’s the argument against robotics. And when you need flexibility on your lines or doing something differently on a whims notice in order to support it. And so, you know, it’s a fine line of people who do it well, there’s nuances that go into it. It will be interesting to see, you know, how things continue to play out. And we’ll continue to talk to factory owners and to people in supply chain and see where they’re doing and bring that information back to you.

Dan:
I think a robot could replace us doing this podcast. Like they can just AI get a script here, like do a little hot, take one or two every like two and a half minutes program that in, they kind of voices already too. So that’s easy. Well,

Will:
I mean, you’re right. They could, you know what they can’t predict though.

Dan:
Charisma,

Will:
Charisma. What if we wanna make a football pick, do you think they can make predictions? Like we can.

Dan:
I think they’ll be more accurate.

Will:
You think? So?

Dan:
A hundred percent. Wow. Oh

Will:
Yeah. Okay. Well, who’s your pick then, sir. Who’s your pick to win the super bowl this year?

Dan:
Oh, I’m gonna go, I’m gonna go dark horse here. You know, you know, will, I’m a big, you know, reader of football lines. These days love the NFL. That was sarcasm. I like the saints verse, the Raiders. And I like the Raiders winning it all this year. Lock it in the Raiders. Oh,

Will:
Wow. Yeah. I, I, I like your Raiders. Dark horse pick picking the saints is interesting.

Dan:
Yeah. Who who’s the saints quarterback? James Wesson. It was a joke. He’s gonna have a great season. But the Raiders, one of all,

Will:
All right. I like it. I am taking the Panthers to win the Superbowl you’re book. You’re a joke when you hear it here first, and it happens here and people are gonna look and be like, wow, they couldn’t have been a robot. You’ll know that the Panthers beat the bills than so a

Dan:
Robots, a robot is smarter than, than you to do that. So that’s why they would never pick the Panthers. So who do you have them losing to in the super bowl?

Will:
I have the bills losing to the Panthers in the Super Bowl.

Dan:
Wow. Wow. I guarantee you come February. We’re gonna be completely wrong with poly art predictions, but what we’re never wrong about is how you can rate, subscribe and listen to Safety Stock on your local, wherever you get your podcast, if that’s Apple or Spotify or whatever’s out else out there, I have no idea now.

Will:
So if you wanna let us know how your senior robotics changed in the supply chain space, let us know. And until then we will talk to you soon.