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Criterion 6 Indicator 44
Rationale
Direct and indirect employment in the forest sector, and forest sector employment as a proportion of total employment.
 
Employment is a good indicator of economic activity. Direct employment includes work that results directly from harvesting timber and processing it into products used in the economy. Indirect employment includes work that results from supplying the forest industry with goods or services. Oregon’s forest sector is very dependent on the U.S. housing industry, and therefore is closely linked to the business cycle. Relative stability in employment indicates a stable economy. Although minor decreases in employment can be linked to new technology, most changes in employment result from changes in the demand for Oregon’s products or changes in the supply of raw materials to the industry.

Can This Indicator Be Quantified
We used the Oregon covered employment and payroll statistics prepared by the Oregon Employment Department to track forest sector employment over time. The data is based on payroll information submitted to the unemployment compensation program. We used the last ten years of available data as a reference period, including the years from 1987 through 1996. Only the data for direct employment was used as the indicator (SIC Codes 08, 24, and 26). Indirect and induced employment would be extremely difficult to calculate for each individual year, and these numbers would be unlikely to substantially change our understanding of forest employment trends.
 
Figure 44-1. Total forestry employment in Oregon, 1987-96
 
 
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Trends
In Oregon, total employment in all forest sectors has declined by about 20 percent from 1987 to 1996. Employment was relatively stable at about 80,000 jobs from 1987 to 1989. However, direct employment in the forest sector dropped rapidly from 1990 to 1993 as the timber supply decreased. Since then, total forest employment has been relatively stable.
 
The drop in total forest employment was due to a large decrease in jobs in the logging, sawmilling, and softwood plywood industries, plus a 10 percent decrease in the number of jobs in the paper industry (SIC 26). These job losses were partially offset by smaller increases in the number of jobs in the mobile home, reconstituted wood panel, and forest services industries.
 
Figure 44-2. Lumber and wood products employment in Oregon, 1987-96
 
 
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Figure 44-3. Forestry employment as a percent of total employment in Oregon, 1987-96
The forest industry is an important sector in Oregon’s economy. In 1987 the lumber and paper sectors accounted for 38 percent of Oregon’s manufacturing employment. As the lumber industry has declined and the high technology industry has expanded, the wood products industry’s relative importance has decreased in the state’s economy. However, in 1996 the lumber and paper sectors still provided 26 percent of the state’s manufacturing employment. As a percent of total employment, the forest sectors (forestry, lumber, and paper) accounted for 7.5 percent of Oregon’s total employment in 1987, and 4.4 percent of total employment in 1996.
 
 
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Data Source and Availability
   
Data is updated annually by SIC code.

Reliability of Data
 
The unemployment program does not cover all employed people. Therefore the data may be slightly misleading if additional non-covered employees join the unemployment program. In particular, self-employed people and small agricultural businesses are not required to be part of the unemployment program, and some of these workers could be in the forestry sector (SIC Code 08).

Scale
 
Statewide by industry and county.

Recommended Action for Data Collection
   
None.

Definitions
   
SIC Code — Standard Industrial Classification Code.

Source
 
For this indicator, the data came from the Oregon covered employment and payroll statistics, provided by the Oregon Employment Department

Selected References
   
None.