The Need for Speed in Steel Manufacturing with Charlie Carter

Connect with Charlie Carter:

Website: https://aisc.org/

Email: carter@aisc.org

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturers' Network Podcast. I'm excited to introduce you to our guest today. Charlie Carter. Charlie, a structural engineer by education and for most of his career, is now the President of the American Institute of Steel Construction, the AISC.

The AISC is a nonpartisan, not-for-profit technical institute and trade association that serves the structural steel design community and construction industry in the United States. Charlie, welcome to the show.

Charlie Carter: Thanks, Lisa. I appreciate you having me.

Lisa Ryan: Please share with us a bit of your background. I know that you spent most of it as an engineer, so what led you to do what you're doing now?

Charlie Carter: Yes, well, I graduated with an engineering degree in structural engineering 30 years ago. It was a time where it was difficult to find a job. But there was this job at ASIC, which I knew from my education. I was taught steel design, and I took that job not knowing what it would be. But 30 years later, here I still am. I thought I was in my forever until retirement job. In my previous role, I was Vice President and chief structural engineer running all the technical activities of AISC on behalf of our industry members and serving the design Community traction industry.

But as fate sometimes has it, there's one other thing you might not have expected. So I became interested interviewed and was selected to be a is each President, my current role.

Lisa Ryan: The AISC is a credentialing organization, so please share with us what you do for the steel construction industry.

Charlie Carter: You mentioned in the introduction that we're a technical Institute and a trade association. Those are two very different functions. Usually, they are separate, but the AISC has existed for 100 years. So we're 100 years old this year.

Lisa Ryan: So, happy anniversary.

Charlie Carter: Thank you very much. It's been strange here to have an anniversary, but you can celebrate everything virtual. If you look at our founding, we were founded by some very smart people who saw a need to have things like the basis for design, the basis for contracting, and resources that would be useful. So in the 1920s, they created standards that engineers could follow in the design process and contracting standards, where you didn't have to invent the wheel every time you wanted to buy and sell structural steel. These are resources that people could refer to know what was acceptable and, more importantly, acceptable.

The AISC, in its technical institute function, has been serving that role of documents. The building code references every jurisdiction in the United States that uses the international building code design, and construction is done according to the standards we write. The key role that AISC provides as a technical Institute is creating that information and all the information that supports it. There are somewhere north of 300 volunteers - experts in design and construction - who give their time, expertise, and wisdom to create all that information. It's been maintained by the succession of those volunteers for 100 years.

In 100 years, somebody will say that it's been done for 200 years. There will always be buildings and bridges made out of steel and a need for information. The trade association part serves the industry that we exist in. They are the businesses that make the steel in a mill where it has a service Center where it's cut it to length, put holes in it, fittings on it, and prepare to ship to the field to be erected into buildings and bridges and those are steel fabricators.

Those are the primary Members that we serve. Interestingly, we help them most by providing all that information to the design community to pick steel and designs. Then they have work to do, and that's what their businesses are based on. So the technical information feeds the purpose of the trade association, and we do both in parallel.

Lisa Ryan: Well, and it makes the industry stronger when you have it on both sides. People have access to technical information, but then they can also network with each other and see what's going on in the market. And make friends with people who they would have considered their competitors. So this makes the referral basis stronger and makes the industry as a whole stronger.

Charlie Carter: that's exactly right, and what you have in these committees, you have a mixed group of people that designed and people that construct they have some educators, you have some researchers, you have some code officials. You have a lot of different perspectives in the room, and the more they talk to each other, the better the results that we get. They tend to know each other, and they're going to work on that building or bridge together in the design and construction process. So the benefit is to them in some respects, as well.

Lisa Ryan: We think about steel in the United States like way back when we were all about steel, and we were this massive producer. We have this idea that the steel is not made here. It's going everywhere else. You and I had a conversation that we do a lot of steel here. Tell us how that's changed the industry, and what impact steel has had on the United States economy.

Charlie Carter: That's an excellent point. People hear about steel in the news today, and it's pretty common for people to think that steel is made elsewhere. However, in buildings and bridges, that's not the case. The vast majority of steel you see going up on a building or to make a bridge is produced here in the United States. If you go back 40 years, you had companies like Bethlehem steel located in Pittsburgh, Bethlehem, and Gary, Indiana, and places like that - high population centers because there were many people employed in the processes of mills. They also were fairly dirty because they were doing basic oxygen production techniques, which involved down raw materials and a lot of stuff coming out of smokestacks.

About 40 years ago, a transition started that mainly was an economic change was then called mini-mill. They were smaller than those big integrated Mills that I named before. They were led primarily by Nucor and other companies today. Companies like Steel Dynamics aren't located in population centers. They use production techniques based on recycling scrap steel and melting it using electric car processes. A carbon rod is pushed into the recycled steel, and a ladle and the electricity run through it to melt it. That's a very different production technique. It's lower cost, and it's also significantly clean, so not only has the industry reinvented itself many times over, they've reinvented where they're located. The production techniques and the cost structure production are much lower. The carbon footprint is different, so when you mostly hear comments about steel being dirty, we're talking about production techniques still used in other countries. In the US, we lead the world in the cleanness of our production and the sustainability of construction using steel made in the US.

It's a great story, and I wish more people knew how much steel is produced here and how green it is based on how we produce it here.

Lisa Ryan: I'm sure that that will surprise people because we don't necessarily think about sustainability and a green industry when you're talking about steel. What are some of the things when we talk about attracting people to the steel industry is because we talked about the fact that they're locating it where energy is inexpensive because so many of the processes are automated. If somebody is considering a career and looking at steel, what are some of the career opportunities? Why would they want to join the steel industry?

Charlie Carter: Everybody's looking for people these days. We hear that on the news. It doesn't matter what industry you're in, every store you pass on your way to work is looking for somebody to work with, and the steel industry is no different.

The great thing about jobs in the steel industry is they're great jobs. This is an industry that builds things. When you drive to work, you pass all these things, and you point to, and you tell your kids, "I built that." It's an industry that makes things and builds things, and that's what this country has been all about - the making and the building of things. That is what has driven us as a society and as a country.

When I look at how all those changes that I described the production have happened, the shift from population centers to low energy cost centers in the United States, the mill today. If you had gone into one of those old integrated mills, you would see people everywhere - and shoulder to shoulder in some cases, doing the processes. It was very labor-intensive. Today, if you were in a mill and you had to talk to someone, you probably have to walk to find them.

Suppose people are running equipment that's highly automated and computerized. In that case, mechanized and people drive the production techniques at a higher skill level. It's the same thing in our warehouses - the Home Depot's of steel are called service centers. The mill sells to service centers, and they warehouse products until somebody needs them. Then, they'll buy it if there's enough. After that, they'll buy it from a mill direct.

But more often today, probably 70% of the steel bought and sold in the US goes through service Center. That makes for a lot of efficiencies. You're not warehousing a lot of steel in your yard and needed someone else's doing that well. Those are also excellent jobs. We're in a trade with a product with a very high value and a very high impact. And the people that are buying, that the fabricators there the bulk of AISC members, we have about 1000 fabricators in the US, who are members of AISC. They're the ones that cut those shapes the length and put the holes in them where they're supposed to go so that the parts that come together and get bolted together. The holes are in the right place, or welding components get attached in the shop or the field.

All of the jobs in a steel fabrication shop are kinds of jobs where you learn a skill, enter that workforce, and grow in your skill. You're able to grow a career at having that skill welding or any of the jobs in a fabrication shop have the potential to progress. We also see a lot of automation and fabrication shops, including today's robotics making a huge difference where a lot of parts can now be automated entirely for how they would be fabricated makes a difference there. That way, the fabricator can make more tonnage on a given day. Thanks to automation, they can say that they can play the same number of people and produce more tons of steel. Robotics is only adding a home flavor to that. That's very exciting to see is what keeps the industry vibrant and keeps those jobs rolling, and keeps them as attractive for a place to work.

Lisa Ryan: So it's not only from a technology standpoint that you get to deal with robots and automation. You also get the immediate gratification of seeing the building and the bridges you helped construct. From a more significant mission standpoint, we were talking before the show about the percentage of recycled steel, so you're making a difference in that you're making something that you're able to use repeatedly.

Talk about that a little bit - more on that sustainability and the recycling part of it.

Charlie Carter: That's a huge benefit of steel. It's something that developed quite organically, for a pardon the pun, but this is not something that nobody talked about. Sustainability, in the terms that we're talking about it today, 40 years ago. Those mini-mills are now the largest producers in the country.

They started with the idea that there's a better, faster, more efficient, and less costly way to make steel. That drove the recycling of steel scraps deal in the US. We recycle a lot, right. Everybody puts their recycling out, and it gets picked up, and the steel components of that get separated and probably find their way to some reuse 98% of steel across the board. 98% of what's made of steel in the US is your car, dishwasher, refrigerator, cans, old beams from buildings, and railroad car wheels. Think about everything that magnets stick to, and 98% of that finds its way back as recycled steel at the end of its life.

About 2% is lost somewhere in the process; it doesn't get separated, or there's corrosion that happens, and all these things add up to about 2% loss but 98% recoveries.

Lisa Ryan: I had no idea it was that high.

Charlie Carter: Seeing those beams that get rolled today or 93% recycled. Stuff winds up at a mill in the yard, where they pick it upcharge the ladle, bring it in the shop, and melt it down. It's just as good and then many times better because of the mix that they put together. You get better chemistry and more refined steel due to everything that comes along with that recycling process.

Lisa Ryan: Right now, technology keeps making it better and better too.

Charlie Carter: Interestingly, it was all driven by economics. This was a faster and less costly way to make it, but it also turns out that it's earth-friendly. Thirty years later, we go, wow, that this was good. In the US, we enjoy a status. The rest of the world is catching on to their recycling now. One advantage we have is our power grid. What drives the carbon footprint of steel since the steel is recycled. That's the energy you're putting in, and the US power grid is also one of the best in the nation for execution - the best in the world for sourcing that power.

If you look at other countries, they're primarily generating electricity where they're using it in steel production with coal plants. That's the opposite. For example, in the US and China, the carbon footprint of US production is one-third or say it the other way. Chinese production is three times the carbon footprint of what we produce in the US.

Lisa Ryan: What are some of the things that you're seeing your members doing that are going well, that they're doing well, that are making a difference in the industry and their work environments?

Charlie Carter: The marketplace right now is pretty hot. It's incredible to me how things evolve them the marketplace will slow down. You went through that period after 2008, and again just a few years ago, and the market heats up, and you can't make steel fast enough. That's the period of the market that we're in right now. It's being driven by many factors - warehouse construction, distribution centers, the Amazon economy is creating a lot of construction and a very high steel demand. It's a really good time to be in a position to make that steel and make the components from that steel and sell those in the marketplace. That drives a lot of innovation. We're always looking for ways to advance how we design and construct.

One of the things we're working on today is seeing right now is called the need for speed. That's a little play on the old Tom Cruise movie. I feel the need for speed. We realized that we could work all day to make everything cheaper and just cut class, but anyone can do that. What you really could do to serve the construction industry and the needs of owners and developers and anyone who would pick steel make it easier and faster. To pick steel easier for them to design and systems that would make projects go faster at the end of you can cut time out of a construction project.

When people are paying interest on loans, if the project opens sooner, they get rents faster. One good example of this is Magnus Associates in Seattle, that a project folder in your square tower where they were collaborating with us. One of those innovative ideas that need for speed projects well speedcore. This was a new way to do the Center of a building which is more traditional methods would have been a concrete core with steel framing around it. They said we think we could go four months faster in construction if we did the whole building at a steel rate. So they innovated this idea called speedcore. When they tried it, first project, first practical use of the technology - they saved eight months in the construction.

The owner or the general contractor on that project estimated was about a $20 million savings versus what it would have been in the old system. So this interest in this opportunity to use steel and the market driving it right now allows us to look at things like that. It's super exciting to deliver something practical and meaningful. We played a small role in that AISC, everybody could come together, and now we're looking at other projects using that same approach.

The second project is going up whether there's a third, fourth, fifth that is soon to be. We hope that's something that we see going to revolutionizes the whole marketplace throughout the country, but we'll see where it goes.

Lisa Ryan: If you were to think about the best tip that you've seen either coming through AISC or technology workplace, what would that be to share with our listening audience today?

Charlie Carter: The most important thing that I have observed in my 30 years is the power of the group that comes together. Everything we do, I mentioned earlier, is by committee. We have 300-some volunteers. They're the people who have built the tallest buildings globally and the longest bridges in the world - either by designing them or constructing them. They're all sitting there, and they're all talking to each other in these meetings. They're the most accomplished people I could find.

They sit there and say, well, I didn't think that that's a good point, and nobody knows everything. Then, the right group comes together, and they create information that's useful to them and useful to everyone else.

There is value in that combined knowledge and the quality of smart people talking to each other. That same thing happens on a project when the designers and the constructors speak to each other. Too often, they're driven into adversarial modes, where you have to beat the designer down and get as much out of them as you can. I got to beat the fabricator down and get as much out of them that usually doesn't work out. In the grand scheme of things, if everybody came together and said, how will we work on this together and make this a great project.

It works for standards. They write the standard, and it becomes an excellent standard that everyone can follow and make building bridges safe for the general public. Efficient, economical design and build and in work on an individual project to advocate for that.

We love it when we see our member fabricators being involved early in a project pick their brains. Because earlier in a project, you can have the most impact that that tower in Seattle went the way it did because people talked about the process early and said, what can we do here. It will build that in their minds before they ever started designing it. They made the most of it, and it was that collaboration. That, to me, would be the most important thing. There's...