October 18, 2020

Manufacturing in Round Rock: From current growth to future predictions, industry outlook remains positive

By Rachel Madison

Over the last several months nearly every industry across the world has had to pivot dramatically to stay afloat during the coronavirus pandemic.

That proves true for the manufacturing industry—deemed essential from the beginning of the pandemic—which meant big changes had to take place. While company growth and hiring didn’t look good for many local companies, for others, hiring was still happening. And most all local manufacturers continue to keep a positive outlook for the future of the industry in Round Rock and across Texas.

Case Study: Odyssey Technical Solutions

Larry Broome, senior director for Odyssey Technical Solutions, the world’s largest dedicated repair company for radio frequency, DC, and microwave equipment, said running a repair floor and trying to socially distance was his company’s biggest challenge when the pandemic began.

“We have 130 benches and about forty techs, so we had the space to spread people out, but it was a challenge,” he said. “Right from the beginning we started doing temperature checks and wearing masks and social distancing. We also obviously put a focus on deep cleaning every time our cleaning crew comes in.”

High risk individuals or those with children home from school were also able to work from home, which helped all of Odyssey’s employees feel safe from the beginning, Broome said.

“Everybody was happy that the company reacted quickly and thoroughly to what we needed to do,” he added. “But in the midst of all this, we didn’t miss a beat. Business was and still is booming.”

In fact, during the height of the pandemic, Odyssey was able to open a repair facility in the Netherlands. Employees from that facility visited Round Rock in January for training but were unable to return again due to the coronavirus.

“We’ve had to do everything through Zoom calls since then to get them set up,” Broome said. “We now have a daily call with them to discuss all the technical stuff. We aren’t able to go visit anyone, and no one is able to come visit us, so we’ve gone completely to technology for all our orders. Even with that, we are ahead of last year as far as revenue, and we have more work in progress than we’ve ever had in the system.”

Company Growth and Hiring Woes

Although hiring hasn’t been a big practice in recent months, Mitch Altman, chief executive officer at ThermaSol, a manufacturer of steam showers, saunas, and other steam-related amenities, said his company has hired a few new employees during COVID, but of course, they’re all working from home.

“From an owner’s point of view, not being able to see your team members when you walk through your place just feels weird,” he said. “We’re operating and functioning, and I know we’re functioning, but it’s very strange.”

Chatsworth Products has hired new employees during the last few months, but Melissa Aleman, chief human resources officer at Chatsworth Products, a company that engineers thermal, power, and cable management solutions for data centers, enterprise networking, and industrial enclosure markets, admits the number of new hires has been significantly less than what was anticipated at the start of 2020.

“Hiring has been much more limited thanks to COVID, but we are hiring for critical roles and as people leave,” she said. “We are doing a lot of it up front via video conferencing and telephones, and we’re not inviting people onto our campuses until they are in the final round of interviews.”

Ron Orris, managing director of Chatsworth Products’ Round Rock facility, added that the onboarding process for new hires has been a bit of a challenge, because they aren’t able to walk around the building, meet the team, and get situated with the environment and its processes like they normally would.

“It’s a challenge because a lot of our team members aren’t in the building and they don’t have access to them to get questions answered,” he added.

Hiring new employees has had to be done in nontraditional ways at Infinitum as well, said Michael Gray, chief operating officer at Infinitum Electric, a manufacturer of electric motors.

“We would normally meet each person face to face, so we’re taking a leap of faith with these people,” he said. “But we’re checking references, and we are using various meeting techniques virtually to do the interviews, but it has certainly changed.”

Because Odyssey’s business hasn’t slowed during the last several months, Broome said that growth caused the company to hire at least one repair tech a week during the month of September.

“I know that sounds weird, but I think it’s easier to hire repair techs because some industries who had electronic technicians that haven’t come back as quickly as we have has made more of a workforce available,” he said. “We are finding good candidates really quickly—quicker than we did a year ago.”

Future Insights

In the end, Curt Smith, chief financial officer at AYRO, a designer and manufacturer of all-electric vehicles, believes the silver lining of COVID-19 in the manufacturing industry is that many manufacturers will move from other states into Texas because of the difference in the regulatory environment and the space Texas still has to spread out geographically.

“In Texas you can have more square footage per employee than highly populated areas like New York or San Francisco,” he said. “People are resonating with that. In New York, people are basically sitting on top of each other, and COVID has scared people away from that. I think Texas will benefit more than other states in the aftermath.”

Overall, Altman doesn’t believe COVID-19 will have a profound effect on the manufacturing industry as a whole, but he does think distribution channels will be affected.

“People aren’t going to stop wanting products from the manufacturer that facilitates whatever that product is, but the distribution channels are definitely going to be affected and there will have to be a change there. The guy who makes a widget will still make it, it’ll just depend on where it’s being sent so that it can be purchased.”

Orris believes all manufacturers going through COVID-19 will be more resilient because of being forced to make more creative work strategies, develop better problem-solving skills and invest in safer work environments.

“I also think risk mitigation planning will be more thorough,” he added. “If you’re a company that relies on supply chains, it may not have been important to have suppliers in different regions before this. But once you go through an event like this and see the disruption, it will become a ‘this will happen’ scenario instead of a hypothetical one.”

Broome said because of the pandemic, technology has made a huge leap over the last several months.

“The pandemic has shown that technology should move forward and we are seeing some of that with autonomous vehicles and artificial intelligence, for example,” he said.  “The manufacturing industry in general was able to jump all the hurdles that came our way and now we are once again moving ahead.”

Jim Hempe, chief financial officer at TECO-Westinghouse, a company that manufactures industrial motors, said he was expecting a great year of growth in 2020, but because of the virus, that didn’t happen.

“We came into this year with big plans, and those plans are still there, but right now we’re experiencing a self-imposed stop on doing everything,” he said. “If we can undo that, we think we’ll see things start normalizing, and factories will start producing more and our demand will start to go up. We hope to get back up to what we were at the end of last year.

Gray believes COVID-19’s lasting impact will be an inevitable displacement.

“Some things just won’t come back for a longer time period than you think,” he said. “If a business was struggling, it may never come back. I also think there’s a bigger dip coming, but I don’t see it being something that we’ll never climb out of.  The underlying fundamentals of the manufacturing industry are still good, it’s just a question of how long this goes on.”

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