WASHINGTON (Reuters) - President Barack Obama will announce two new manufacturing institutes aimed at attracting and nurturing businesses that will hire workers for highly paid jobs in the United States, a White House official said on Saturday.

One institute, to be located in Detroit, will focus on lightweight and modern metals. The other, in Chicago, will concentrate on digital manufacturing and design technologies, the official said.

The Department of Defense will lead the effort with $140 million in government money. The president is due to make the announcement Tuesday, the official said.

The president has made a central focus of his second term efforts to make life better for middle-class and lower-income families whose fortunes have not fully recovered from the deep 2007-2009 recession. Part of that push is an effort to expand manufacturing jobs, many of which were lost in preceding decades as U.S. firms searched for cheaper labor abroad.

With a Republican-led House of Representatives focused on cutting federal spending and reducing the size of government, the president has been forced to scale back his plans for the institutes, finding money from savings within existing programs rather than securing a big chunk of new spending for them.

The aim of the manufacturing institutes is to take advantage of the U.S. abundance of world-class universities to attract companies interested in being close to research and pools of skilled workers. The institutes are intended to bring together firms that are competitors to share ideas in the intermediate stage between invention and commercialization.

"Manufacturing production is growing at the fastest pace in over a decade, and the president is committed to building on that progress," the White House official said.

Obama introduced the manufacturing innovation institute idea in 2013. It is based on a German model and draws on a pilot program in Youngstown, Ohio. The president's goal is for there to be 45 such institutes in all.

The administration in January announced the first one in Raleigh, North Carolina, which is focused on spurring development of energy-efficient, high-power electronic chips that will make electronic devices such as motors and consumer electronics smaller and faster.

(Reporting by Mark Felsenthal; Editing by Lisa Shumaker)