Timber industry reacts to recessions, owl protection regulations
Timbers where lumber was once stacked outside before being shipped from the Georgia-Pacific Coos Bay mill are now empty. The company announced April 11 it would be closing the mill, putting 111 people out of work.
Oregon's economy was built on timber.
The industry long provided an employment base for towns throughout the state and the heyday of the state's timber industry stretched from the 1950s into the 1970s, said Josh Lehner, an Oregon Office of Economic Analysis economist.
But mills statewide began to close about 40 years ago, around 1980. A recession, prompted by high home loan interest rates, spurred the closures. Companies that owned mills built during the boom faced the dilemma of whether to reinvest in a flagging industry.
"Come 1980, when that recession hits, these mills are 20 or 30 years old, so they need to be replaced, retooled or left to go to waste ... they were kind of at the end of their life cycle," Lehner said.
The federal listing of the Northwest spotted owl as a threatened species in 1990 under the Endangered Species Act sent another wave of change over Oregon's timber industry. Big, old trees had been a staple for Oregon mills. Federal protections for the owl made old growth woods on public lands off-limits.
Even mills that remained open evolved — making adjustments to handle smaller logs and be more efficient. The companies that put money into their mills enhanced their operations with more automation, reducing the number of workers necessary.
In the 2000s Oregon's timber industry was in the midst of a revival, but the Great Recession in the late 2000s led to a crash in lumber demand. Another recovery followed.
"The industry outlook at this point is pretty steady," Lehner wrote in 2017. "Demand for raw logs from China is ebbing some, however the ongoing U.S. housing recovery is encouraging. Our office’s expectations, based on input from our advisors, is for both harvest levels and employment to hold steady around levels seen today. We likely need a big event to drastically change the outlook."
Left to be seen is whether recent mill closures in Oregon, including the Georgia-Pacific mill in Coos Bay, are part of a big event.
"(The industry) had been growing until recently," said Brian Rooney, regional economist in Lane County for the Oregon Employment Department.
Follow Dylan Darling on Twitter @DylanJDarling. Email dd@registerguard.com.