Last week, Colorado Senator Michael Bennet announced that Manufacturer’s Edge (formerly Colorado Association of Manufacturing and Technology) is the recipient of a five-year, $8.34 million grant from the U.S. Department of Commerce’s (DOC) National Institute of Standards and Technology (NIST). As Bennet’s release outlined, “Manufacturer’s Edge was one of 10 state MEP centers selected for funding in a nationwide competition. NIST awarded a total of $130 million in funding to help MEP centers increase their services and customer base. The new cooperative agreements are for five years, subject to availability of funding and successful annual reviews.”

I asked Tom Bugnitz, CEO of Manufacturer’s Edge (ME) and occasional columnist for CompanyWeek, to elaborate on the award and assess Colorado’s manufacturing landscape.

Q: Tom, congratulations on the $8.34 million Department of Commerce grant. In announcing the award Senator Bennet said, “These additional resources will allow the organization to expand their current services, reach new customers, and continue their great work in Colorado.” To be clear, are these additional funds or does the money comprise ME’s annual operating budget?

A: Thank you, Bart, and thanks for the opportunity to talk about this. As you can imagine we’re excited about being selected as the MEP center of the next five years.

The short answer to your question is that NIST has increased our funding by two and a half times.

Since the local Manufacturing Extension Partnership center (MEP) was established in Colorado, NIST has provided $665,201 per year to support the center, subject to our finding a 2:1 match of those funds, or $1.3 million. (We did that by selling consulting and training services each year.) This award increases that annual amount by over a million dollars per year, and reduces the match to 1:1. Not only will there be more money coming into Colorado to help manufacturers, they have made it easier for us to use that money.

Q: Explain the process: ME was asked to prove its worth in a lengthy process last fall known as a ‘re-compete’ to qualify for the federal funds. Who were you competing with, and is this process common across the country?

Being chosen as a state’s MEP center is the result of a competitive process in which any nonprofit organization, university, community college, or state agency can apply to be the center. The result of that competition is a contract and financial award to operate as the state’s MEP center and receive NIST funding. Currently there are 60 MEP centers in the U.S., with at least one in each state and Puerto Rico.

As part of a larger review of the national MEP system, the MEP centers in all 50 states and Puerto Rico will be opened up for re-competition over a 4 year period, which started with a first round in August of 2014. During that round 10 MEP centers, including Colorado, were opened for competition.

Our previous contract was in its third year of five when we agreed to open up the MEP contract for an open competition with any other organization in the state. By doing this, we guaranteed the $1 million increase in federal funding to Colorado, regardless of who was ultimately awarded the contract.

We don’t know how many other proposals were received by NIST or who the proposers were, and NIST will likely not reveal that information.

Q: The federal government is focused on manufacturing. In addition to ME’s grant, Colorado and other states have been the beneficiary of significant financial support, awards designed to shore up U.S manufacturing. Can you provide some national context to ME’s award?

The Obama administration has consistently focused on building, re-building, and advancing manufacturing and manufacturing methods. The MEP system represent the “boots on the ground” of that effort, and funding for the system as a whole has remained stable or increased in the last few years, going against the trend of most federal programs. Overall the MEP system is a $140 million program.

The 800-pound gorilla in federal and state manufacturing efforts is the federal government’s National Network for Manufacturing Innovation Institutes. In 2013 the President proposed $1 billion be invested in 15 Innovation Institutes. To date, five have been started (with initial investments of $120 million and expected investments this year of another $150 milliob), including three in which Colorado participates: Digital Manufacturing and Design, Lightweight Metals and Materials Manufacturing, and Advanced Composites Innovation.

Q: A notable difference that you reference in Senator Bennet’s release is ME’s broad charter, to provide resources and assistance to manufacturers across industry sectors. How does ME’s charter differ from or complement other federal or regional efforts?

The main difference is our singular focus on helping individual companies grow and create jobs. As I mentioned before, we are the boots on the ground, applying resources directly to companies based on their needs and particular circumstances. We’re out every day with manufacturers listening to their concerns and developing programs to address them.

That said, there are a large number of programs aimed at manufacturers in Colorado. We look at all of those programs and ask one question: How can we use our resources to leverage those programs and create better results for manufacturers?

As an MEP center, NIST allows wide latitude about what programs or services we offer, but also expects us to not only respond to the direct needs of Colorado manufacturers but also support state initiatives that help manufacturers over the longer term. As examples, we have used the Colorado Blueprint as part of our plans, and have supported the SMART initiative from OEDIT since day one.

If a program helps manufacturers, we want to help that program.

Q: You’ve written in CompanyWeek about the need to get resources directly to manufacturers. Describe the state of Colorado manufacturing?

To be as blunt and direct as possible, Colorado manufacturing is diverse, it’s strong, and it’s growing. But not all manufacturing sectors are sharing in the growth. Some industry sectors and individual manufacturers that are hurting, and the workforce shortage is constraining manufacturers all across the state.

We can describe Colorado manufacturing by numbers that tell part of the story. There are roughly 5,600 manufacturing companies in Colorado employing about 133,000 workers in 21 different manufacturing sectors. 64 percent of those companies employ less than 10 people, and only 10 percent employ over 50 people.

That means we must do things that directly help small manufacturers hire new people, find new markets, and develop new products and capabilities. Right now, manufacturers across the state are creating regional organizations to help define the regional needs that companies like MEP can address and to create formal and informal networks of suppliers and customers within the state to grow local businesses. Individual companies are standing up and leading the charge for workforce development and capital access. We have the potential and foundation to do much more, and people all over the state are beginning to act on that potential.

We have a chance to do great things in manufacturing in the next 10-20 years, and we can establish Colorado as a leader in manufacturing technology and innovation.

Reach Tom Bugnitz at tbugnitz@manufacturersedge.com.

KOTA Longboard’s Mike Maloney doesn’t lack for confidence. Winner of the JP Morgan Chase Main Street Grant and $150,000, Maloney told me in September 2013, “We offer a product of high performance and high value, and I am living proof you can start a manufacturing company in the United States.”

It was music to my ears. We featured KOTA in just our second issue, and finding Mike was not only a revelation — my kids ride KOTA — but an affirmation. He’s in the leading edge of a tidal wave of inspired and modern manufacturing reshaping our economy. He’s a poster child for CompanyWeek.

The wave isn’t lost on city officials in Denver, who deservedly were included in the Denver Post story about KOTA’s award. Not only was Paul Washington’s industry team supportive of KOTA from the beginning — I saw — they’re proving to understand the opportunity of light manufacturing in the city’s future.

Denver’s already the beneficiary of one high-profile lifestyle-manufacturing boom – its craft beer scene is nationally renowned. The Post mentioned a new initiative from the City called “Create Active Denver,” conceived to lure ‘sports action lifestyle’ companies to the city. Denver co-hosted the inaugural Colorado Apparel Manufacturing Summit this past fall (with CompanyWeek). Denver’s industry pros also work hand-in-hand with groups like Manufacturers Edge, to host other events like Beers-and-Gears.

Lifestyle’s only one of a several high-potential manufacturing opportunities for the city. Another may be the technology-fueled Supply Chain — small design and tech-shops armed with tools to enable prototyping and small-batch manufacturing. Growth here should not only inspire start-ups but also fuel a new era of big-company engagement with local suppliers and contract manufacturers.

It’s an exciting prospect for Denver — and others increasingly tuning in: an urban economy profoundly changed by its city producers.

If there’s a quibble with Denver’s approach, it’s that its gaze may not yet extend far enough. In the future, it’s easy to see the City (and State of Colorado for that matter) inviting all manufacturing into a ‘key’ economic sector, to better align resources and promote the community. The numbers convey the breadth of opportunity. As CU’s Brian Lewandowski writes, in the second half of 2014, “Colorado ranked 3rd for manufacturing employment growth; over the past three years Colorado ranked 7th; and over the past five years, Colorado ranked 8^th, even though Colorado ranks 30^th overall for manufacturing jobs.” The entire sector’s booming. And Denver’s in the middle of it.

But for now it’s easy to celebrate the accomplishments of one of manufacturing’s inspirational leaders and a community of supporters who’ve helped get him and the KOTA team this far. There’s a journey ahead for everyone.

It seems Jay Timmons was born to lead NAM, the National Association of Manufacturers. He’s from America’s rust belt, Chillicothe, Ohio, with generations of manufacturing in his blood and a determined, buttoned down all-American comportment that feels a natural fit atop NAM’s 14,000-strong membership. Conjure an image for a spokesperson for U.S. industry, for its proud manufacturing base. You’ll get Jay Timmons.

What you also get today from Timmons’ is a manufacturing policy message in transition, that like industry, is taking stock of recent success but searching, at times awkwardly, for footing in a new and complex manufacturing economy. For Timmons and NAM, this translates into a modern love/hate relationship with President Obama and his administration’s policies.

Timmons was in Colorado last week on a 12-city national State of Manufacturing tour, speaking at Ball Corporation’s Broomfield facility. CACI, the Colorado Association of Commerce and Industry, a manufacturing advocate and state affiliate for NAM, organized the gathering.

What’s changing about his message is the support NAM summons for policies that strike a somewhat unprecedented ideological balance for this venerable organization. It made for an entertaining presentation that swung from open hostility to begrudging support for the president, even as its historic and resolute opposition to the traditionally Democratic staples of more regulation and higher taxes remains the foundation of its pro-business rubric.

For Timmons, “manufacturing faces a disproportionate share of the burden of government regulation,” and he was openly contemptuous of the EPA and administration’s support of more stringent air quality standards.

“The administration’s regulatory agenda and regulation of greenhouses gasses would limit fuel choices, increase energy prices and make power less reliable,” he argued. “The development of next-generation power-plant technologies is a prime example. Today coal generates about 40 percent of the nation’s electricity and we have decades worth of coal reserves. The rules would eliminate this abundant resource from our energy mix.”

But in the next breath, Timmons’ confirmed that “America has an unprecedented and incredible global advantage in reliable and affordable energy — who would ever thought this ten years ago? — and that’s what’s driving manufacturing’s resurgence.” Further, he acknowledged that “manufacturing’s carbon emissions are down 13 percent percent since 2005, while manufacturer’s value-add to the economy has grown 19 percent over that same time period, because we’re building more efficient power plants,” adding that the “U.S. has made significant progress we need in an ‘all of the above’ energy strategy.”

On tax strategy, he decried America’s “highest corporate tax rate in the world — a problem we need to fix,” advocating, of course, tax reform. With no movement from Congress yet on this issue or legislation reaching the President’s desk, Timmons held his fire. Not so on immigration reform, where he offered a full-throated defense of Obama’s push for comprehensive immigration reform and clear path to citizenship for immigrants working here illegally.

On net neutrality, Timmons was equally unequivocal. “The Internet of Things has the potential to reshape our industry or nation and our world, all of the is progress begs the question: Why should we be turning back the clock back 80 years? That’s exactly what President Obama wants to do by regulating the internet with a 80-year old law that was enacted during the era of rotary telephones. It will curtail investment in our broadband infrasture, hinder the creation of game changing technologies on our shop floors and yield little benefit for consumers.”

The statement is as uncertain as it is bold, though, and his embrace for the administration’s cybersecurity initiative softened the blow. “I have to say the president is taking the right steps in calling for more real time cyber-threat information sharing in the private and public sector and targeting liability protection. This is a promising start for sure.”

Timmons also voiced his support for Obama on free trade. “We need to be where overseas consumers are buying: International trade supports more than 700,000 jobs in Colorado; its companies trade with customer in over 200 countries. A smart trade policy is the difference between growing business and shutting their doors. Free and fair trade including trade promotion for the President of the United States will give us greater access to the foreign markets we need.” It’s not a unanimous sentiment in the manufacturing community.

Taken as a whole, this well-intentioned if somewhat confusing policy evolution reflects an industry in transition. Manufacturing is changing. It’s tech-driven – digital; it’s agile, small business; it’s young and lifestyle-driven to suit trends and changing consumer preferences; it’s beer and organic food at the same time it’s steel and paper, fabricating and welding.

It’s changing and NAM and Timmons are trying hard to adapt — however confusing and disruptive the journey may be.

Last week manufacturing was in the national news as a new report called into question the health of the sector. It’s an ongoing debate in business circles: is manufacturing enjoying a true comeback, or not?

The source was the Information Technology and Innovation Foundation (ITIF), and a report entitled The Myth of America’s Manufacturing Renaissance: The Real State of U.S. Manufacturing.

ITIF throws water on any talk of a “renaissance,” arguing that since manufacturing hasn’t fully recovered to its previous employment and GDP levels and is growing more slowly than the broader economy, “U.S. manufacturing is shown to be in state of moderate, cyclical growth, and not,” the report emphasized, “experiencing a renaissance.” And further, any efforts to influence the “debate on U.S. manufacturing should not be informed . . . with an agenda of keeping bad news from dampening support for further global integration.”

Yahoo Finance, The Guardian, Barron’s, and CNBC ran with the story, parroting ITIF’s conclusion and calling into question its own previous reporting, with headlines like U.S. manufacturing comeback: Nice story…if only it were true and New study paints bleak picture of manufacturing rebound. CNBC seemed annoyed, Is that nice story about the return of “Made in America” simply made-up?

Is ITIF correct? And did the media get it right?

As we’ve chronicled, manufacturing employment and GDP reached all-times lows in the late 2000’s. Consider the recent arc of U.S. manufacturing, as The Atlantic described in 2011:

Manufacturing jobs peaked in 1979 at 19.6 million. They drifted down slowly for the next 20 years — over that span, the impact of offshoring and the steady adoption of labor-saving technologies was nearly offset by rising demand and the continual introduction of new goods made in America. But since 2000, these jobs have fallen precipitously. The country lost factory jobs seven times faster between 2000 and 2010 than it did between 1980 and 2000. Until very recently, this trend looked inexorable — and the significance of the much-vaunted increase in manufacturing jobs since the depths of the recession seemed easy to dismiss. Only 500,000 factory jobs were created between their low, in January 2010, and September 2012 — a tiny fraction of the almost 6 million that were lost in the aughts.

Six million jobs lost in the 2000s and not as many created since.

But a renaissance, a comeback, would be measured on progress since reaching the low point, and in this context, data indicate a sector with considerable momentum as of late. As the L.A. Times noted, “Since February 2010, U.S. manufacturing employment has increased at a rate of 6.7 percent, with some Midwestern and Southern states such as Indiana and South Carolina seeing gains of 15 percent or more.” Colorado’s a bright spot. Jobs are still being offshored, but as ITIF (and The Atlantic) notes, as many are on their way back.

Money is also flowing back into the sector in the form of federal R&D funding, and business capital: Forbes recently noted that a new technology-powered supply chain is increasingly catching the eye of investors. And improving economics of making things in the U.S. is just one of several powerful national and regional trends now favoring U.S. manufacturing.

The media’s headline writers would have also benefitted from looking more closely at the source. ITIF’s agenda (or at least the author’s), its advocacy of “global integration,” puts it at odds with manufacturing from the get-go. For many, ‘globalization’ is just a catchword for ‘offshore jobs.’ It would be hard to see ITIF projecting manufacturing job growth. ITIF may be a credible source; it’s also a biased one.

It’s noteworthy that, today, manufacturing’s enjoying any good news — 40 years of misery is a long time. And, what was offshored and disassembled can’t be rebuilt overnight. ITIF may also miss the more profound trends that may influence the sectors resurgence — more than the cost of Chinese labor or domestic energy. Here and in other places, manufacturing is also broader-based than at any time in recent history.

Manufacturing is coming back — but it’s changed. The goalposts have moved. The question is: to where?

That’s probably a better story for the media anyway.