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Economy & Economic Development  March 12, 2010

Manufacturing jobs in the 2010 pipeline

Despite ever-growing competition and few tangible incentives to offer, Northern Colorado remains an attractive place for companies looking to relocate or expand their operations.

“The good news is that Northern Colorado is and remains an attractive market for companies doing relocations,´ said Mike Masciola, COO and senior vice president of Northern Colorado Economic Development Corp., which markets Larimer County.

“We’ve been very active on the inquiry side,´ said Larry Burkhardt, president and CEO of Upstate Colorado, which focuses on Weld County. “What we’re finding is companies are broadening their searches.”

Mike Masciola

And while the identities of companies showing interest in Northern Colorado are a closely guarded secret until a site announcement can be made, both economic development marketers say the level of interest is high despite a still-down national economy.

“We had 61 new company leads in 2009,” Masciola said. “In the first two months of 2010 we’ve had 17, so we remain busy.”

Burkhardt said Upstate talked with 19 prospects through February. He said Danish-based Vestas Wind Systems, which opened a blade manufacturing facility in Windsor in 2008 that brought 500 new high-paying jobs to the region, should be credited for steering other foreign-based interest in the region.

“We continue to see a lot of interest on behalf of manufacturers, and a large percentage continue to be foreign companies,” he said. “I think they do indeed find Northern Colorado is a good market to come to.”

And while the region has lost an estimated 4,000 jobs in the last few years, new companies and existing firms are slowly replacing those lost jobs as 2010 gets under way.

Strong manufacturing interest

Burkhardt said Vestas, which is building additional facilities in Brighton and Pueblo, has led the way for foreign companies to consider the region as a hub for alternative energy. He noted that companies from Germany and Spain – with a strong emphasis on solar and wind respectively – are closely eyeing the area.

One German solar company, Wirsol, opened its first U.S. office in Fort Collins in early 2009 to be near and partner with Abound Solar. Formerly AVA Solar, a spinoff company from Colorado State University research, Abound has a manufacturing facility in Longmont.

Masciola said foreign-based manufacturing companies like Wirsol and U.S.-based companies like Connecticut-based Hexcel Corp. – which opened a production facility in Windsor last year to supply composite parts to Vestas – are paving the way for more manufacturing jobs to come to the region.

“There’s more demand in manufacturing than most people think,” he said.

Masciola said of the 17 companies he’s talked to in 2010, about 60 percent were manufacturers.

Masciola said about 60 new manufacturing jobs have been brought to Larimer County so far this year and another 160 jobs are expected to be announced soon.

Burkhardt agrees that manufacturing is on the upswing in Northern Colorado, unlike some other parts of the nation. Weld County has particularly benefited from hundreds of new manufacturing jobs coming to the area in recent years, including Vestas, Owens Illinois and Hexcel in Windsor and the expansion of JBS in Greeley and UQM in Frederick, to name a few.

Good-paying, primary jobs are the goal of both economic development organizations, and that often comes from a manufacturing employer. But both Burkhardt and Masciola say the region is at a disadvantage because of a slim inventory of industrial-type spaces to lease.

“One of the most immediate challenges we have is we don’t have a lot of big commercial buildings already built,” Masciola said. “We are not as deep, inventory-wise, as in other places. Right now, that’s a competitive disadvantage for us.”

Both Masciola and Burkhardt note the region has many attractions for companies looking to relocate, including a well-educated workforce, good transportation systems, and – for alternative energy companies – the National Renewal Energy Laboratory nearby in Golden.

However, Northern Colorado has few tangible incentives to offer. “Every company knows Colorado is not an incentive-rich state,” Masciola said. “So while we’re competitive against other communities in Colorado, are we competitive against other states? No, we’re not.”

Burkhardt agrees, citing one example of Amarillo, Texas, which recently offered a total incentive package worth $44 million to lure a cheese company 80 miles away to town and bring 350 jobs with it.

By comparison, he noted, Colorado was only able to offer Vestas $3.5 million in incentives.

Good things happening

Masciola notes that the down economy is also making for an uphill climb, pointing out that 53 percent fewer companies were looking for relocation and expansion sites in 2009. He added “that number is probably not going to increase in 2010.”

Despite those hurdles, good things are happening in Northern Colorado. The region recently reached the 500,000 population threshold, which puts it on a higher level of interest for large companies seeking a strong workforce pool and local amenities.

JBS recently purchased Texas-based Pilgrim’s Pride poultry processor out of bankruptcy, and about 200 upper management employees and their families are expected to move into the region in 2010. Burkhardt and others representing Weld County recently traveled to Texas to pitch the county as the place to buy a new home.

And Weld County may also be seeing a revival of its oil-and-gas industry, as new wells are being drilled in new areas of the county and existing fields are being tapped more efficiently with new technology.

Perhaps most important, the two economic development organizations are working closer than ever before to bring jobs to the region as a whole. That cooperation is currently focused on drawing in more alternative energy manufacturing jobs.

“Recently we did invite (NCEDC) to participate in a market initiative for more renewable energy manufacturing,” Burkhardt said. “That’s probably the most tangible thing.”

“I have to give Larry credit on that,” Masciola added. “We both have that as a targeted industry, so let’s share that and we all benefit. I’m very optimistic about working together in the future. I think the partnership has a good foundation.”

Despite ever-growing competition and few tangible incentives to offer, Northern Colorado remains an attractive place for companies looking to relocate or expand their operations.

“The good news is that Northern Colorado is and remains an attractive market for companies doing relocations,´ said Mike Masciola, COO and senior vice president of Northern Colorado Economic Development Corp., which markets Larimer County.

“We’ve been very active on the inquiry side,´ said Larry Burkhardt, president and CEO of Upstate Colorado, which focuses on Weld County. “What we’re finding is companies are broadening their searches.”

Mike Masciola

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