I've been fortunate to participate in CU Leeds' excellent Colorado Business Economic Outlook the past two years, parsing manufacturing data with capable economists and business stakeholders lined up by Richard Wobbekind's team at the Business Research Division. The 54th annual Report will be presented December 10 at the Grand Hyatt in Denver.
Here's a first look at where manufacturing is forecast to end up in 2018 with a peek at '19, and what the numbers say about the state of Colorado manufacturing as this incredible economic year winds down. (The primary source of the following data is the Colorado Department of Labor and Employment.)
Cannabis is the outlier. Chemical Manufacturing has jumped 9.8% to 7550 jobs and is forecast to add another 5% in 2019, growth likely attributable to cannabis manufacturing. Growth in Food Manufacturing may also be benefitting from an influx of cannabis companies.
If cannabis data seems anomalous, so too does the state of industry reporting overall, not just here but across the U.S. Is manufacturing an industry, or a sector? Are energy extraction companies manufacturers? Are companies based here yet manufacture offshore, manufacturers at all? We've visited these questions before. In Colorado, it's also challenging to track apparel brands, medical device manufacturers, and aerospace companies, as employment categories aren't always a clean fit.
Anomalies aside, the 2018 numbers tell a fascinating story. For starters, while Colorado's manufacturing standalone contribution is relatively modest (just under $25 billion, or about 7% of state GDP), contrary to a prevalent narrative, it's growing. Jobs were to have been replaced by automated operations by now. But as CU's Brian Lewandowski has noted in CompanyWeek, "With the multiplier effect, direct industry activity supports a total of 441,000 jobs in the state, and contributes approximately $47 billion to state GDP." And only this week, the Economic Development Council of Colorado pointed to a new study and suggested the state is "poised to grow its manufacturing industry." (Also check out Oregon's sector -- today comprising 20% of the state's GDP.)
But it's growth industries here that hold so much promise, not only in leading employment gains, but in redefining the narrative around manufacturing. This is not your grandfather's sector. Manufacturing today is a mix of disruptive food and beverage brands; of advanced fabrication sending satellites into orbit, fashioning electric motors, and developing the next wave of U.S.-made medical devices and bio-products; and of aspirational brands across the catch-all "Other" category in the language of economists.
It's also a sector underpinned by a solid foundation -- a cadre of welders, benders, and cutters in such high demand that RK, a regional infrastructure giant, today has 300 apprentices in its four-year program, with plans to hire them all. 300!
Underestimated, the manufacturing economy soldiers on.
Bart Taylor is publisher of CompanyWeek. Email him at email@example.com.