See "Notes" below for changes to make the "shortbread bites".
Cream together butter and powdered sugar. Mix in egg and vanilla.
Gradually add flour until well combined (see note). Fold in jimmies by hand (a mixer will break them up too much).
Knead dough a few times until it comes together. Chill in refrigerator at least ½ hour.
Roll dough with a standard roller to about ¼ inch thick. When at correct thinness, roll with embossed roller to press in design (this will thin it a little more which is fine). Position a cookie cutter over nice areas of the design and cut out cookies. Chill cookies in freezer for about 10 minutes or refrigerator for about ½ hour.
Bake on an ungreased cookie sheet at 400 F. Start checking for doneness at 7 minutes, then every minute thereafter until cookies are just starting to brown. Cool on wire rack.