This is an article by Brian Rooney, the Regional Economist for Douglas and Lane Counties in Oregon. It’s pretty interesting about Oregon and the forest products industry. Thanks to Treefrognews for this one! Below is an excerpt. Interesting employment projections at the end of the article.
Smaller Harvest, Technology, and Economies of Scale Contribute to Decline
Several structural shifts in the wood products industry have contributed to the long-term employment decline. First, there was a drop in timber harvests from environmental concerns in the early 1990s. As harvest from federal lands reduced the amount of available raw material to mills, employment dropped, indicating that harvest reductions were a cause for the employment loss in the early 1990s.
New technologies brought another structural change to the industry by making lumber mills less labor intensive. Employment continued to drop even after harvest levels stabilized in the late 1990s, and employment did not increase much despite a housing construction boom in the mid-2000s. Jobs in wood product manufacturing per million board feet harvested dropped steadily after 2000, at least partly due to technology.
Lumber production per worker in Oregon is another way to look at efficiency gains. By combining Western Wood Products Association production data with sawmill employment data, we can create a measure of lumber production per worker. It increased rapidly in the early 2000s, going from 806,000 board feet per worker in 2000 to 1.1 million in 2005. It then dropped back to 791,000 board feet during the Great Recession. It’s likely that mills cut production through fewer hours to some extent instead of letting go of workers during the recession. After the recession, production per worker increased to the elevated levels it had reached before the recession, reaching roughly 1.2 million board feet in 2012. Production per worker has stayed close to 1.2 million board feet per worker through 2022 but dropped to 1.1 million board feet in 2023.
In addition to new technologies, smaller mills were shuttered, creating efficiency through economies of scale (larger mills can produce more per worker). The average production of sawmills operating in the western U.S. increased as smaller mills were shuttered and efficiency increased through economies of scale and new technology. Between 1990 and 2021, the number of mills in the western U.S. dropped from 600 to 144 while average production per mill increased from about 35 million board feet per year to 102 million board feet per year. The number of mills has since dropped to 141 and average production per mill dropped to around 97 million board feet per year in 2023.
Wood Products Are Still Important in Oregon, Especially in Rural Areas
Even with the long-term decline, wood product manufacturing is still a large industry in Oregon. In 2024, there were 22,400 jobs and roughly $1.5 billion in total payroll in the industry. While statewide the industry makes up only 1.1% of total employment and 1.1% of total payroll, the concentration is much higher in some counties, especially rural ones. For instance, in Curry County, 8.1% of total employment and 11.7% of total payroll was in wood product manufacturing. Most of the counties with a high concentration of employment in wood product manufacturing are rural.
In counties where the percent of total payroll exceeds the percent of total employment, average wages are higher in wood product manufacturing than the overall average wage. This is the case in most of the rural counties listed, indicating that wood product manufacturing provides some of the higher paying jobs in rural counties.
Jobs Generally Pay Well and Do Not Require High Levels of Education
The top 20 occupations in wood product manufacturing are mostly medium wage but do not require high levels of education. Most of the top 20 occupations have a typical entry-level education of a high school diploma or less. Some of the more technical occupations like industrial machinery mechanics and electricians have average annual wages of more than $70,000 a year and have a typical entry-level education of a high school diploma, providing opportunities for those who don’t pursue a college degree.
Looking Ahead
Employment projections from the Oregon Employment Department show that wood product manufacturing employment is expected to gain 700 jobs (3%) between 2023 and 2033. The plywood and engineered wood products, and other wood products subsectors are expected to have 3% growth while sawmills and wood preservation is expected to drop 3%.
Like many industries, wood product manufacturing has an aging workforce reaching retirement age. This creates demand for workers through replacement needs. Aside from gaining 700 jobs between 2023 and 2033, there are expected to be roughly 8,900 openings from people leaving the industry and the labor force, largely due to retirements.