Over 7 million men in America have opted out of the workforce. That’s a big problem for a lot of employers, but it’s an 800 lb. gorilla kind of problem for manufacturing businesses. So what the hell is going on? Thankfully, we invited Patrick O'Rahilly (pronounced like “O’Reilly”), founder at FactoryFix, a company dedicated to curing what ails such businesses. The boys didn’t quite solve this complex problem, but they sure had a lot of fun trying. Almost as much fun as you’ll have listening.
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Intro: Hide your kids. Lock the doors. You're listening to HR's most dangerous podcast. Chad Sowash and Joel Cheesman are here to punch the recruiting industry right where it hurts. Complete with breaking news, brash opinion, and loads of snark. Buckle up boys and girls. It's time for The Chad & Cheese Podcast.
Joel: Oooh, yeah. If you don't know us, ask your mother. What's up, everybody. It's your favorite degenerates, also known as The Chad & Cheese Podcast. I'm your co-host, Joel Cheesman. Joined as always, the Fred Flintstone to my Mr. Slate, Chad Sowash is in the house.
Chad: More like Wilma. [laughter]
Joel: We're excited to welcome Patrick O'Rahilly, founder at our friends FactoryFix. Patrick O'Rahilly. God, even the Irish are like, "This guy is too Irish for us." [laughter] St. Patrick's Day is coming up. What are you gonna do? Is that like your only holiday every year?
Patrick O'Rahilly: Yeah, absolutely. It's the holiday of the year for us. And yeah, I'm gonna party my ass off.
Joel: And you're in Chicago, is there... I guess New York is the only... Maybe Boston, in terms of St. Patrick's days? Is that that?
Patrick O'Rahilly: Yeah, I mean, Chicago does it right, for sure. We dye the entire river green. [laughter] It can't be good for the river, but we do it anyways.
Chad: Can't be good for the river and/or the citizens [laughter] who's downriver.
Joel: It's not nearly as bad as all the dead bodies that are in there from the early 20th century, I'm sure.
Chad: They dredged those up. Come on.
Joel: Yeah. [laughter] That's just flavor. That's just that that cheese steak or that... Sorry, Italian B flavor. [laughter]
Chad: Excellent. Patrick, I tell you what, you are the founder of FactoryFix. What beyond that should our listeners know about you, about the person, about long walks on the green rivers?
Joel: How many Irish Setters do you own?
[laughter]
Patrick O'Rahilly: Yeah. No, I mean, nothing of note other than... Look, I grew up in this industry, I had a company before this, we built robotic automation systems for manufacturing companies, so...
[music]
[laughter]
Chad: More sexy than robots, baby.
Patrick O'Rahilly: Absolutely.
Chad: Unless they're sex robots, of course.
[chuckle]
Joel: Fembots.
Patrick O'Rahilly: Not sex robots, but [laughter] in a weird way, we're selling the same pitch. We're saying, "Look, you can't find people. Let us put a robot in there for you." And now we're trying to put actual people in there for you. So grew up in the industry and just trying to figure out how to get more people working in manufacturing, which is not the easiest task these days.
Chad: Why make that pivot though? You were on the robot training. You were chugging along with robot training. And automation is huge, especially manufacturing, so why switch over to the human elements? Why do that?
Patrick O'Rahilly: Yeah, so the reason was we weren't making any money building those robotic automation systems.
[laughter]
SFX: Should we play a game?
Patrick O'Rahilly: They're not the most profitable ventures in the world, at least the way we were doing it. And we started this company right out of college. We had no idea what we were doing at first. And so we would try to build any machine that we could sell. So we would go into a factory, see what they were doing manually, you know, putting cups in a box or something, and we'll say, "We're the cup box packing expert. Let us build a machine for you," [laughter] and we would quarter right there, we'd come up with a number pen and paper and build the machine, run it off in our facility, install it, and then service it over time, and that's where we saw the opportunity.
Chad: Was maintenance.
Patrick O'Rahilly: Yeah, totally. Like after we installed these systems, our customers had a hell of a time maintaining them or doing anything with them 'cause they didn't have the people on their full-time staff that had those skills to do it.
Chad: Oh yeah.
Patrick O'Rahilly: Yeah.
Joel: Patrick, we actually have some hidden footage from one of those sales calls.
[video playback]
S?: 60% of the time, it works every time.
[laughter]
Joel: Yeah. Yeah, it sounds like a good business plan. So you pivoted to FactoryFix. How's that going?
Patrick O'Rahilly: It's going well. It's going well. FactoryFix, in and of itself, has had many pivots. So we originally started, like I said, we were like a on-demand app for automation experts, like Uber for automation experts is the idea. And we'd have these customers that Compass sold machines into that I would say, "Hey, if you need service, use FactoryFix. Click a button and we'll send someone with those skills to fix your machine," so that was the idea. Fast forward ahead, we end up selling Compass. Tesla actually buys the company in early 2017.
Chad: I know that company. Yeah.
Patrick O'Rahilly: You know that?
Joel: So you know Elon?
[laughter]
Patrick O'Rahilly: My partner at Compass worked directly for Elon for a long time, so he's got many stories on that front working with him.
Chad: Spooning on the floor at nights with Elon Musk in the factory. Yeah.
Patrick O'Rahilly: Exactly, exactly. [laughter] So I take FactoryFix, I think it's got an opportunity... I mean, this is back in those days where it's like, everyone's doing Uber for whatever.
Chad: Yeah.
Patrick O'Rahilly: And I think FactoryFix, we're gonna raise venture capital and be the next big thing, and three or four pivots later, here we are doing... Essentially recruiting automation for manufacturing companies, which is a far cry from on-demand automation experts.
Chad: Yeah, but I mean, it's kind of like starting somewhere in the funnel, because you have to be able to create that database and you have to be able to credential them to be able to get to that Uber. You just can't be Uber overnight. Especially when you're talking about... I mean, Uber is for drivers. If you have your own car and you can drive, tada! But for you guys, credentialing is something entirely different. You can't just say somebody, a CNC Operator, 'cause you have to have a base of those. So very naive, yes, but a few pivots [chuckle] later, I get it, I get it.
Patrick O'Rahilly: Yeah.
Joel: To set the table for us, I'm a man myself, usually.
Chad: Really?
Joel: And I find the current state of the male worker, young males, fascinating. We have 7.2 million American men that have just said, "I'm not participating."
Chad: That's 25 to 54, so that's a big span.
Joel: Yeah. What the fuck is going on?
Patrick O'Rahilly: I mean, it's wild. It's wild. Well, in manufacturing specifically, all the talk before the pandemic was around the skills gap, where this workforce is aging and the people coming into the industry, one, there's not enough of them, but two, they don't have the skills to support all the new technology that's come into manufacturing, with the robotics and the automation industry 4.0. So it was all about skills, skills misalignment. And now after the pandemic, we have all of these workers that have left the workforce, we have all of these workers that don't want to work in person, so the whole remote work movement, and what we're left with is a pure labor shortage now in manufacturing. We're now not just a skills gap, now it's a labor shortage. We can't even fill our unskilled positions, and turnover's so. It's a real problem for the industry. And so...
Joel: Is it a labor shortage or a participation shortage?
Patrick O'Rahilly: Exactly. That is a million dollar question. I think the people exist, it's just what are they doing. And your guess is good as mine, but my thesis is that it's gig economy stuff, and you'll find someone that works for DoorDash and Uber and Amazon Delivery and jump from gig to gig and work when they want, and the number of people that wanna work five days a week in-person on first, second or third shift in a manufacturing facility has really fallen off a cliff.
Chad: In this actual CNBC story that we saw from late January, it said 98% of men in 1953 had jobs. They were in the workforce. Today it's 89%. Well, there are plenty more people in the populace today than there was in 1953. But in 1953, the composition of the labor force, the workforce was entirely different. So only 34% of women were actually working. So we're seeing a shift because there are now over 50% of women in the workforce today. So back then, it was one of those things where men go to work. Today, we're not that way. We're more of a blended community where the woman can actually go out, make more money than the dude does and he just stays home. Maybe he's with the kids, maybe he's playing Nintendo, who the hell knows. But do you see that could prospectively be a very thick slice as of hat onion that we're peeling away?
Joel: Chad's blaming women, everybody. I want that on the record.
[laughter]
Chad: I'm empowering women. I'm just saying if that's the case, then we've gotta think about...
Joel: Blame, empower, yeah.
Chad: We've gotta think about all the factors. Do you think that's one of the big factors?
Patrick O'Rahilly: Yeah, I think certainly that could be the case, but honestly, you're asking the wrong guy when it comes to women in the workforce, 'cause in manufacturing, it's like non-existent. And that is one of the major movements going on with organizations like the Manufacturing Institute, which is the workforce arm, and the National Association of Manufacturers. Their big push is getting more women in manufacturing, and it is an uphill battle in manufacturing, especially. They've almost been excluded, and I think it's the industry's fault, frankly. But there are jobs in manufacturing that women are better suited for, frankly, than men, and we need them to participate even more than they are, even though it's trending that way in other industries. So manufacturing is a difficult industry to ask that question.
Chad: Well, living here in Columbus, Indiana, where is the international headquarters of Cummins Engine Company, which is the biggest diesel engine manufacturer in world, a lot of my friends are females, work at Cummins. So it seems like to me... And from that aspect, Cummins has always had the idea of going into the community and pulling the community, training the community to come work for them. Not to mention also a lot of H-1Bs for diversity and those types of things, it just doesn't seem like most of the manufacturing community itself has embraced that kind of feeling. They would rather say, "Well, it's a skills mismatch, the government needs to help," as opposed to actually taking it upon themselves, going into the community and being a part of the community and drawing them in to these great jobs, 'cause advanced manufacturing jobs are not the manufacturing jobs in the 1950s at all.
Patrick O'Rahilly: Yeah, one of my biggest worries for manufacturing recruiting is that it's so short-sighted. It's all about putting out fires, this machine is down because someone just quit and we need to fill this job today. Find someone that has experience working on this machine. Hire them. I don't care what their next progression in their career is, 'cause there isn't one, frankly, here, or I'm not investing the time in setting up a career path for that level of machine operator. So it's very reactive. And we're trying to do our best to really push a more proactive approach where you can hire entry level people, convince them that manufacturing is a great career choice because in three, four, five years, you can work your way up and make really good money without any college debt even.
Joel: Chad, curious, in Columbus, is Cummins going to the high schools?
Chad: Yes.
Joel: Do you see advertisements in Columbus around women?
Chad: Community colleges, high schools, yes, all the way through. And again, to be a part of... Actually be a part of the community, and it's not just about the charity and the giveback, it's also about building talent pipelines. And we hear companies talk about talent pipelines and they're totally full of shit. They don't even know what a talent pipeline was if I hit him in the fucking head. These guys understand it, which really blew my mind when I came to live here, because they still have vocational in the high school where they ripped it out of my high school back in North Central Ohio years ago, which is exactly where it should still be. So yeah, the answer is a big yes.
Joel: This seems to be an issue that's been politicized quite a bit. Mike Rowe, famous for his Dirty Jobs show, said in an interview that Uncle Sam was basically footing the bill for men getting out of the workplace because it's easier to take government checks and play video games into this to actually work. On the left, you have the upskilling argument, which you highlighted in one of your comments. Where are you on the political spectrum in this argument? Is it getting too politicized? What's your take on that aspect of this argument?
Patrick O'Rahilly: Yeah, I think there's something to what Mike Rowe said in that. I do think stimulus may have gone a little too far, which I understand at the time in the fog of war. You had to do what you had to do. No one knew what was going on. But it certainly gave the opportunity to a large percentage of the working population to give them the freedom to hang out whether seven hours a week or seven hours a day, whatever, we figure out. But yeah, I don't think that money's fully run out yet. I think we're starting to see signs that it is and participation slowly taking up, but the labor market, I think, is one of the last things to go. And these people are gonna hold out as long as they can, they're gonna start racking up credit card bills to maintain their lifestyle, and then once you start seeing some default rates tick up, that's when you'll see those folks resurface in the workforce. So that is part of what I think is going on there.
Chad: I feel the shift for me is females in the workplace, they're not really attracted to manufacturing jobs. Skills mismatch, where companies aren't actually going into the communities and drawing those individuals in because there are tons of people who wanna work with their hands for a living. I see that here, locally, there are HVAC and plumbing companies who pay for certifications and they go into a contract, so you have a three, four-year contract after whatever certification you get, much like the military. The military does ROTC, where they pay for your education, but then you owe the military three to four years of our life. So it almost seems like the answer is there, but we're just not getting to it, and I don't understand why because in many cases, it seems fairly simple.
Patrick O'Rahilly: Yeah, I agree. I think the Cummins example that you brought up is great. I think they're doing it right, and I think there's a lot of those large centralized manufacturing companies that do invest in it and do have a good pipeline of talent coming in. The problem is that 98% of manufacturing companies are either smaller than that, or they're decentralized, so there's a lot of facilities all over the place, and each facility is essentially on its own for recruiting and talent acquisition development. So they're just resource-constrained, and that falls below their line of what they need to do that day. And that's part of what we're trying to build into our platform, is trying to automate those things for them, even down to the awareness and getting people excited out of high school. We partnered with the National Association of Manufacturers in their Creators Wanted Campaign, and they're spending millions of dollars going all over the country trying to get these high schoolers excited about careers in manufacturing. And we're getting all that talent and making it easy for them to find jobs in manufacturing, and you just have to make yourself super attractive to that audience, 'cause like you said there are people that wanna work with their hands.
Chad: Yeah.
Patrick O'Rahilly: We're not gonna get the MIT grads and the people that want to be computer scientists. Forget about them, let's find the people that wanna work with their hands, that wanna start making money right out of high school, and you have to win those. You can't let them become Uber drivers and work at Chipotle.
Chad: Well, talk a little bit more about that partnership and actually being able to together, almost like a symbiotic relationship in building a database in which companies can come to you, NAM, one and the same, to be able to find that kind of talent. So talk a little bit about that, talk about the outreach methods, those types of things, 'cause I think that to me is incredibly important, that you guys are working directly with an organization association to be able to try to bridge that gap.
Patrick O'Rahilly: Yeah, so NAM, the National Association of Manufacturers, they're surprisingly big, like I was surprised once I learned how big they are. It is the association in the US for manufacturing. They have 14,000 manufacturing members, and their big campaign is called Creators Wanted, which is basically a campaign to get young people interested and excited about careers in manufacturing because all of those members have told them, "Look, we need help with workforce. There's this labor shortage, there's this skills gap. Please help us." So they take all this association funding and have launched this campaign. It's really cool. They've built out this whole escape room experience in this trailer, and it teaches kids about careers in manufacturing as you solve the escape room and have fun with the game experience, but...
Joel: Clever.
Patrick O'Rahilly: Anyways, they're getting tens of thousands, hundreds of thousands of students coming through, getting them excited about manufacturing, and then what we've done is we've powered their jobs platform on their website in this campaign to help those kids find their first job in manufacturing right out of school and find one that aligns well with their interests, so if they're more mechanically inclined, they can find something where they work with their hands, if they're more electrically inclined, they can find something related to programming or whatever. So yeah, it's pretty exciting.
Joel: Patrick, I'm a novice compared to you, but it seems to be like two things that we could do to solve this or make some big progress into solving it. One is giving formally incarcerated folks another chance or incentivizing companies to give...
Chad: Big applause.
[applause]
Joel: To give them a second chance. And the other one is immigration. We have a lot of people that would love to come to this country and do the work that is not getting done. What's your view on both of those issues, immigration and formally incarcerated folks?
Patrick O'Rahilly: 100% for it. There's a lot of legal red tape that I'm not familiar with that needs to get solved there, but second-chance citizens for sure is an under-represented audience that we need to reach out to as an industry to get them set up with jobs in manufacturing. And the Manufacturing Institute has a program directed towards them that I know is gaining traction, that I'm really excited about. Immigration is another one. I know COVID threw off the whole immigration game pretty badly and now it's just getting started again, but honestly, I don't see any other solution to fill in some of these low-skilled jobs in manufacturing facilities, 'cause the workforce... In that article, you pointed out, the workforce has proven that they'd rather sit at home and just not do them and figure out something else, jump gig to gig or whatever. They're just...
Chad: Or the wife is the primary, yeah.
Patrick O'Rahilly: Or the wife is the primary. They're just not gonna do it. So they're either gonna sit on field or we need to fill 'em with immigration and underrepresented audiences, or we need to automate them all, and I think a combination of those things are gonna happen.
Chad: So Karla Trotman, who is the CEO of Electro Soft, a company outside of Philadelphia that makes circuit boards, said that she wishes she had 45 people that worked there, but she can only find 30, costing the company about $5 million in top line revenue. So when you're going to talk to companies on a daily basis, are they starting to understand that, like you'd said before, that machine and not having a person there operating it is costing the organization dollars every minute, but do they really understand, can they quantify what that dollar looks like? Because I think they would move harder and faster if they did. So are you starting to see them come around to that, or do you think it's gonna take some more time? Especially with these smaller organizations.
Patrick O'Rahilly: It's gonna take some more time. 100%. Like you said, the best manufacturers, the biggest manufacturers, they know their numbers, like the Cummins of the world. The best recruiters think like marketers, and they know every metric, not only at the recruiting funnel, but they know how many dollars they're losing based on how many hours their machine is not running. And so manufacturers, they make money when they produce parts, and so if that machine isn't producing parts because there's no operator or a programmer on it, it's just burning money. So yeah, that's part of our job, is to show the ROI there and to show that downtime matters, and frankly, we just need to help you find a person to get that machine running again as fast as possible.
Joel: What role, if any, do unions have in this problem? And I'll give you an example. When I was a kid, unions were strong. They always got the message of, "Hey, do this job. Join the union, something bigger than yourself. We'll take care of you. We'll fight for you." That message seems largely lost today. What role do unions, if any, play in solving this problem?
Patrick O'Rahilly: Yeah, I think the weakening of unions over the past couple of decades has correlated with the troubles in filling manufacturing positions, frankly. I think the manufacturing industry has struggled to market itself to incoming employees, mainly because that was part of the unions' job a couple of decades ago. They were the ones out there recruiting the young kids to get in and join the union and join the industry. Without that, you're just left with employers that try to do that job on their own, and now they have the ability to move wages up and down to align with what they think the market is for that given person, so... Look, I'm not saying it's a bad thing that unions have weakened, I'm not saying it's a good thing either, but I know it's affected the manufacturing workforce.
Joel: Patrick O'Rahilly, everybody.
[applause]
Chad: O, O, O, O'Rahilly.
Joel: O, O, O, O'Rahilly. Patrick, for our listeners who wanna know more about you or FactoryFix, where would you send them?
Patrick O'Rahilly: You can hit me up on LinkedIn or my email, patrick@factoryfix.com. Factoryfix.com is the website.
Chad: Amen.
Joel: Chad, another one in the can. We out.
Chad: We out.
Outro: Wow, look at you. You made it through an entire episode of The Chad & Cheese Podcast, or maybe you cheated and fast-forwarded to the end. Either way, there's no doubt you wish you had that time back, valuable time you could have used to buy a nutritious meal at Taco Bell, enjoy a pour of your favorite whiskey, or just watch big booty Latinas and bug fights on TikTok. No, you hung out with these two chuckleheads instead. Now go take a shower and wash off all the guilt. Let's save some soap because you'll be back. Like an awful trainwreck, you can't look away. And like Chad's favorite Western, you can't quit them either. We out.