Using a stand mixer cream butter until light and fluffy. Mix in sugars and pumpkin puree until combined. Add egg and vanilla, mix until combined making sure to scrap the sides of the bowl.
In a separate bowl whisk flour, baking powder, salt and ground cinnamon. Beat this mixture into the liquid mixture add a little at a time until it is all combined.
Cover dough with plastic wrap and chill a minimum of one hour.
Preheat oven to 350 degrees when you are ready to make the cookies. Line your baking sheets with parchment paper or spray with non-stick cooking spray. In a small bowl combined the cinnamon sugar mixture for rolling the cookies in.
Remove the dough from the fridge. Using a medium size cookie scoop, scoop out the dough and roll into balls. Place a caramel in the center of the ball and form the dough around it so it is completely covered. Roll in cinnamon sugar mixture. Place on baking sheets.
Bake for 12-14 minutes or until they are slightly firm to the touch. Let cool on baking sheets for 5 minutes then remove to finish cooling on baking racks (about 1 hour).
Place the caramels for the topping in a small microwave proof bowl and melt the caramels in the microwave. Drizzle over the top of cookies. If you need to thin the caramel for drizzling add a small amount of water or milk until it reaches desired consistency.