As we look back this week at a great 2019, it’s also time to forecast the storylines shaping 2020 manufacturing in Colorado and the region.
1. Food’s undersized brand gets a lift
Before publishing last week’s manufacturing employment report, I asked a handful of respected manufacturing executives and development officials to name Colorado’s largest manufacturing industry employer. One got it right.
Colorado’s food sector may be underappreciated, but its success can’t be taken for granted. For example world-class growers along the Arkansas River plains, in verdant Western Slope enclaves, and emerging cannabis plays across the state would benefit from a more cohesive and robust production ecosystem and supply chain widely available along the Front Range.
Developing a Colorado food brand that fuels interest and collaboration statewide seems a priority. Do we even know how to do that?
2. Technology’s oversized reputation gets an overhaul
Here’s a stunning factoid from the Wall Street Journal about the U.S. technology sector that also puts Colorado’s manufacturing opportunity in perspective.
Just five metropolitan areas—Boston; San Diego; San Francisco; Seattle; and San Jose, Calif.—accounted for 90% of all U.S. high-tech job growth between 2005 to 2017, according to the research by think-tank scholars Mark Muro and Jacob Whiton of the Brookings Institution and Rob Atkinson of the Information Technology and Innovation Foundation.
The report also mentions technology’s next tier. No Colorado city is part of that group, either. Boise, Idaho; Provo, Utah; and Madison, Wisconsin, are, and while they may be up and coming tech outposts, they sure ain’t Denver when it comes to overall economic heft.
Colorado’s tech ecosystem may be worth the considerable hype and attention we seem to shower on it. But tech-informed manufacturing is a blue ocean opportunity that technology isn’t. Ergo:
3. Will Colorado’s global manufacturing brands engage more locally?
Big companies comprise a small percentage of manufacturing here, but also lead the industry in technology and automation. But for every Woodward, RK, and OtterBox, big manufacturers investing in growing the local production ecosystem, many others seem uninterested.
Colorado could be an epicenter for outdoor industry manufacturing. A new technology-inspired production paradigm is waiting to be championed by any of a dozen global brands that call the Rocky Mountains home. Innovation percolates in small companies — ask Molson Coors or any number of industrial food brands investing in Colorado startups — but manufacturing needs its bellwether brands to reach down and engage with best practices, experience, and talent.
4. Industrial cannabis is here. Like, right here.
In the second half of 2019 we profiled three cannabis manufacturing companies that combined, employed 400 people — Folium Biosciences (220), Mile High Labs (140), and Paragon Processing (40). Include Colorado’s largest self-manufacturing brands like incredibles and Wana Brands and dozens more that employ thousands, and it’s clear that cannabis is a workforce tsunami.
Manufacturers and the associations that support them have been unenthusiastic or downright hostile to cannabis industry. We hope this changes in 2020. For one, the kids working at Colorado’s cannabis companies would benefit from understanding a career pathway that would keep them in manufacturing when they’re ready to move on if not up.
Last year at this time I wrote that manufacturing is codependent, that manufacturers must come together to solve their challenges. I also said that collaboration is “a work in progress.” Let’s ensure the epicenter of industrial cannabis, and the human capital that’s catalyzed growth, stays here.
5. It won’t always be this easy.
America’s longest peacetime expansion will end, if not in 2020, then sometime soon. What happens when a growth economy normalizes?
For starters, business development becomes mission-critical. In the race for new business, Colorado’s top industries are highly competitive nationally:
Top Gainers (% employment gain in 2018, excludes sectors with less than 50 jobs):
Chemical manufacturing +10.7% (6th fastest-growing sector nationally)
Primary metal manufacturing +5.46% (12th nationally)
Machinery manufacturing +4.5% (19th nationally)
Beverage manufacturing + 4.1% (31st nationally)
Food manufacturing +2.2% (13th nationally)
Our collective challenge is to ensure these industries remain best-in-class as companies work harder to land new contracts when the going gets tougher.
Good luck in 2020!
Bart Taylor is publisher of CompanyWeek. Email him at btaylor@companyweek.com.
