New report shows economic importance of wood products industry in Michigan and in Midwest, Northeast regions

Wednesday, March 17, 2021
The importance of forest products industries in the Northeast and Midwestern states are highlighted in a report published by the Northeast-Midwest State Foresters Alliance.  The report summarizes estimates of economic contributions to local economies in 20 northern states. 

“Forest products industries are an important part of the economies in many Northern states,” said Jeff Stampfly, Michigan Department of Natural Resources State Forester and Forest Resources Division Chief.  “This report provides provides additional data to help describe the important role managed forests play in the Northeast and Midwest. Sustainable forest management provides wood and paper products that we use on a daily basis, habitat for wildlife, clean water and air, and is increasingly recognized as an important part of climate change mitigation efforts.  This project helps quantify one aspect of those benefits.“

According to the report, the forest products industries – comprised of businesses that manage forests, loggers, sawmills, furniture and other solid wood product manufacturers, OSB and other composite board plants, and pulp and paper mills – directly employ over 550,000 jobs, and support a total of more 1.4 million jobs in the northeast and midwest.

“Total sales or output from the forest products industries were about $327 billion in 2017, and that’s nothing to sneeze at,” said David Neumann, Michigan DNR Forest Markets & Utilization Specialist. 

The report, published by the Alliance was produced as part of a three-year project involving 18 of the 20 states in the Northeast and Midwest. The project was supported by a USDA Forest Service 2017 Landscape Scale Restoration Grant.  End products of the project will eventually include the region level report, state level reports for the eighteen participating Alliance states plus Nebraska, 2-page summary bulletins for each report, and an interactive dashboard. All of these can be found on the Alliance's website here

In many states in the northeast and midwest, forestry and forest products may have an outsized impact in rural communities as important local employers.  “In previous studies in Michigan, we saw that forest products companies made up about ½ of a percent of total manufacturing jobs statewide in Michigan, but represented more than 1/3 of manufacturing jobs in in the rural Upper Peninsula” said Jagdish Poudel, MDNR Forest Economist. 
The project was groundbreaking in several ways, said Poudel.  “Previous economic analyses have only been conducted for individual states, and often with differing data, methods, and collections of forest products companies.  This project established a standard framework or methodology for conducting contributions analyses.  And as part of the process, the participating states came to agreement on the collection of sectors that were used to represent the forest products industries.” Establishing this kind of standard process and framework was also important for enabling 1:1 comparisons between states in the region, and over time.  “And if the Southern states and Western states follow suit, it could enable direct legitimate comparisons between regions in the US, with respect to forest products industries.”

The top states in the region in terms of direct employment were Pennsylvania, Wisconsin, Indiana, Ohio, New York, and Michigan, all with more than 40,000 jobs. One of the more controversial inclusions was the addition of the sap production portion of maple syrup industries,” said Poudel. “In some northern states, maple syrup industry employment was the highest in terms of direct jobs.”

The maple syrup industry addition was important Neumann said, because it’s often categorized as part of agricultural production industries, even though nearly all of the work takes place in the forest.  “Maple syrup is an industry with tremendous growth potential in the Northeast and Midwest,” said Neumann.  “Maple syrup production provided about 6,200 jobs in the region, with the greatest number in Vermont, New York, New Hampshire and Maine… You might say the industry has a lot of untapped potential.”