Building robots builds economy
“Competition improves the breed, and when people imitate, we simply take it to the next level.” Dan Allford, ARC Specialties
Here’s the most important thing to know about robots: Humans make them. And the humans who make the best robots make a lot of money.
We hear a lot about losing jobs to robots, but we’ve been through technological revolutions before. More than half of Americans worked in agriculture before the Industrial Revolution, while today less than 2 percent produce most of our food. Humans are tool makers, and eliminating manual, rote and thankless tasks is in our genes.
Building machines to simplify oil field tasks is something Dan Allford has been doing since 1980, and he’s witnessed how technology has changed the industry. As president of ARC Specialties in northwest Houston, he’s also been a force for change by operating the only large robot manufacturing plant in the country.
“Building machines is all I’ve ever done, and a robot is nothing more than a flexible machine,” Allford told me during a visit to one of three Houston production facilities. “This is American manufacturing, designed, built and programmed in America to make other American companies more efficient to keep the work in America.”
ARC started out making specially clad valves for oil wells and built machines to automate the manufacturing. That led to designing more machines to perform difficult tasks.
Two weeks ago I wrote about the high demand for workers who know how to set up, program, maintain and troubleshoot robots. ARC Specialties creates machines
that create those jobs.
The U.S. is leading the world in buying robots right now, spending $86 billion in 2015, a 30 percent increase over 2011, according to the latest figures collected by Redwood Software and the United Kingdom’s Centre for Economics and Business Research, an independent forecasting firm. Higher spending on robots means higher productivity and a faster growing economy.
“There is no doubt about it — robotics is now a significant contributor to economic growth,” David Whitaker, the center’s managing economist, said. “Robotics’ cumulative impact on the overall economy has been much larger compared to the monetary value of robotics today. We expect to see progressively more robotic automation in the years to come, with commensurate benefits to overall economic growth.”
Automation does not necessarily eliminate jobs, Whitaker added.
“There is clear evidence that points towards robotic automation in many cases being a complement for human labor, rather than a direct substitute ,” he concluded. “As more mundane tasks are automated, human effort becomes more valuable as it is focused on higher-level tasks, creativity, know-how and thinking.”
That’s been Allford’s experience at ARC, where he employs 60 highly trained people, ranging from mechanical, electrical, software and welding engineers to skilled machinists, electricians, welders and painters.
“The only way we can compete with low-cost labor is through efficiency. My machines provide a more efficient way to produce products,” Allford said. “I believe everybody deserves a job. Everybody deserves a way to make a living. What we’re trying to do is help companies do that by creating machines that make goods that are salable overseas.”
While Allford must build his own large robots to build things like 80,000-pound blowout preventers for oil wells, he buys smaller robots from foreign suppliers and adapts them for customers with smaller jobs.
The next big trend in automation is the collaborative robot, called a co-bot. Unlike industrial robots that work in cages away from people, these machines work alongside humans to aid in tasks too complex for the machine alone.
“If it hits you, it won’t hurt you,” Allford said, standing next to a prototype that combines a Danish co-bot with ARC’s welding technology. The prototype will be unveiled in November at the FabTech industrial show in Chicago.
Manufacturers shipped 8,950 co-bots in 2016 and that number is expected to reach 434,400 in 2025, according to Loup Ventures, a research firm specializing in automation. Even with robot costs coming down, the co-bot market will be worth $9 billion in 2025, the company said.
While all of ARC’s customers in the past were oil and gas companies, Allford is diversifying.
“There are a lot of fascinating problems to be solved here,” he said. “What we’ve found is that the same technologies that work with coatings for the oil field work, also work for nuclear, the military and ground-engaging wear.”
That’s the kind of entrepreneurial thinking that expands companies and creates job. Allford said he doesn’t need government subsidies or trade protection. He welcomes foreign competition and only wants a level playing field.
“We innovate and others duplicate. That’s the way of the world,” he told me. “Competition improves the breed, and when people imitate, we simply take it to the next level.”
There is no stopping the march of the robots, but their advance offers more opportunities than challenges for those
Chris Tomlinson is the Chronicle’s business columnist. chris.tomlinson@chron.com twitter.com/cltomlinson www. houstonchronicle.com/author/ chris-tomlinson