Logging in the Pacific Northwest maintains a magical mystique to many people. The steep terrain, rainy weather, and large logs lend themselves to romanticized, historical imaginings. In the end, however, the business of logging in the Coastal Range is much as it is everywhere else. Logs need to be cut and loaded for transportation to end markets. Whether this is done with ground-based machinery or manual felling and cable yarding, loggers are needed to do the work. The question is, how many loggers? The “Great Recession” hit the Pacific Northwest forest industry just as hard as the rest of the country, and the logging sector wasn’t spared. Strong export markets led to a reasonably quick rebound, but logging employment continues to lag pre-recession levels (Figure 1).
Figure 1. Logging employment in the Pacific Northwest
Combining changes in logging employment with production data provides clues about the productive capacity of the logging industry. In theory, when the demand for wood is at or near the productive capacity of the industry, new employees are added to meet the demand. Looking at historical production levels per employee in tandem with employment, the break-even threshold has been increasing over the past 20 years (Figure 2). In 2014, hiring was negligible, and production averaged around 750 MBF per employee per year. This represents a substantial increase from 1995, when hiring occurred at an average production closer to 525 MBF per employee. Using these endpoints as a guide, average production per employee has increased between 1.5% and 2% per year. The huge job losses of the recession resulted in one of the largest increases in average production. Presumably more inefficient employees and operations were lost, raising the average productivity of the remaining industry.
Figure 2. Average annual production per logging employee and change in total logging employment in Oregon and Washington.
Increasing productivity of western loggers implies that the logging industry will shrink over time if wood demand stays constant (not to mention if total demand declines), due purely to growing production capacity. It also raises questions about what is driving production gains. Is improved steep terrain machinery providing production benefits with less manpower? Are cable operations becoming more or less prevalent? While these questions are valid and worth further inquiry, it is encouraging to see that the logging industry of the Western U.S. continues to grow and adapt.
Forisk provides additional analysis of forest operations trends in our Forisk Research Quarterly (FRQ). To learn more click here or call Forisk at 770.725.8447.