Back in the late 1950s, dairy farmers in Grays Harbor would haul their malfunctioning pumps from their fields to Jim Vaughan's welding shop. The pumps typically would clog with twine and straw, and word soon spread that Jim could solve their troubles with a clever bit of metalsmithing and his welding torch.

Despite the renown that Jim's "chopper pump" enjoyed among Grays Harbor farmers, he had no idea that his grandchildren and now great-grandchildren would use his invention to help debunk one of the biggest myths in the 21st century economy: namely, that America has plunged into an industrial Rust Age, from which its manufacturing sector can never recover. And that soon, only workers in so-called knowledge or service industries would dare depend on regular employment in the United States.

Indeed, if you read the papers about "massive" trade deficits and heed government data about loss of jobs in the manufacturing sector, you – quite logically – would believe that trends such as globalization, the Wal-Mart phenomenon and cheap Chinese prices are desiccating America's industrial capacity as well as its ability to export products that, because of America's "high" wages, will not be able to compete in world markets.

While this may seem the case in some states, it could hardly be less true here in Washington. In fact, to hear some local manufacturers explain it, developments in the world economy will propel – not curtail – the ability of Washington companies to increase their exports and grow their revenues.

"Our exports are increasing faster than our imports right now – and they have been since 2004," says Dave Gehring, executive director of the Seattle-based Manufacturing Industrial Council (MIC). "You're starting to see mom-and-pop America selling products all over the world."

To account for the discrepancy between what Gehring calls "the endless string of bad news and government reports about the decline of manufacturing and the robust health of manufacturers and related industrial firms" here, the MIC developed a Northwest Industrial Index. Instead of basing its analysis primarily on employment numbers, it also tracks business revenues and exports, and can track manufacturing by the 21 sectors and 473 subsectors of manufactur ing defined by the North American Industrial Classification System.

Gehring conducted a five-year study of Washington state industries covering 2002 through 2006. What did he discover?

"The global economy works for us," Gehring says. "I mean, we already knew it works for Boeing and Microsoft and Starbucks, but now we see it's working for a lot of little mom-and-pop businesses."

He uses the metal trades as an example, a sector that includes metal fabricating and machine manufacturing – including Montesano's Vaughan Co. and its patented chopper pumps. Numbers get the story rolling:

·In 1994, Washington had 2,048 companies in the metal trades; today, that number is down by 18, to 2,030. However, between 1994 and today, these companies' revenues nearly tripled to $9.2 billion.

·The increased revenue was due partly to greater productivity: Payroll expanded by only 18 percent, boosting revenue per worker to $278,000 from $114,000.

·Meanwhile, metal trade exports from Washington increased 86 percent from 2002 through 2005 – a time when overall state exports grew by just 10 percent due to Boeing's airplane troubles in 2002, 2003 and 2004.

Significantly, during the five years covered by the MIC's survey, four key sectors were struggling: aircraft manufacturing, food processing, paper products and computers. "You had Boeing in the tank for three of those five years," Gerhing says. "But everything else grew so fast – the smaller, less glamorous companies grew so fast – that they basically made up for those losses."