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8th October 2019

According to Allen — a University of Oxford economics professor who taught at UBC from 1980 to 2000 — the volume of timber harvested annually in B.C. grew from 6.7 million cubic metres in 1912, to 76.2 million in 1979.

That increase was accomplished, Allen wrote in a prescient essay — “B.C.’s Economy: Past, Present, Future,” published more than 30 years ago — “by extending the geographical area exploited.”

By 1979, however, that expansion had reached the edge of the province’s geographic boundaries. With nearly all of the province divided into Timber Supply Areas, the forest industry had reached the limits of sustained yield management.

“Although no one knew it at the time, 1979 was as significant a year as 1886,” wrote Allen. “1979 was the year the timber frontier closed.”

No longer could the forest industry make sizeable profits merely by expanding the scope of their operations. They had to become more efficient, which meant a greater reliance on fixed capital and new technology, and a drastic reduction in labour costs.

The second of our two numbers, 1.5 million, refers to the average number of housing starts each year in the United States, the biggest market for B.C. forest products, since the end of the Second World War.

From 1946 through to the present day, the U.S. population grew from about 140 million to 330 million. That’s an annual average increase of approximately 2.6 million people.

All of those new Americans needed homes in which to live, and B.C. was a major source of lumber and other wood products.

But over the last decade or so, housing starts in the U.S. — even as the population continues to rise each year by about 2.6 million people — have not regained their former heights.

According to the U.S. Census Bureau, housing starts between 1959 and 2007 rose by an annual average of 1.547 million.

The number never fell below one million. Until 2008, that is, when housing starts dropped below 906,000. That number plunged even further in 2009, to a miserable 554,000.

Between 2008 and 2018, U.S. housing starts have averaged 918,000 — less than two-thirds the previous annual average since the Second World War.

Listen to Troy Tofsrud discussing, in 2014, his plans after losing his job due to the closure of Houston Forest Products Mill. Video by Christopher Grabowski for a Tyee series on the people of hard-hit Houston, BC.
To be sure, housing starts south of the border have increased in recent years, but they look to top out at less than 1.3 million annually and may never again reach their post-war average.

Why? In part it’s because an increasing proportion of young people — that is, those between the ages of 25 to 34 — are opting not to lead their own household.

Research by the National Association of Home Builders has found that “increasing numbers of young adults now choose to live with their parents or parents-in-law,” as well as sharing housing with roommates, housemates and other non-relatives.

As a consequence of the decline in American housing starts since 2008, B.C. lumber exports to the U.S. have also been falling.

The peak year for softwood lumber exports from B.C. to the U.S. was 2005, as the province sent an astounding 28.7 million cubic metres of lumber to American customers.

Four years later, in 2009, that number plummeted to just 11.9 million cubic metres.

Even after a slight recovery, B.C. softwood lumber exports south of the border last year, in 2018, were only 15.5 million cubic metres — or about half the volume in 2005.

A hot seat with splinters

It is clear that the challenges facing B.C.’s forest industry far exceed the ability of one individual to correct or even successfully mitigate.

But such is the task for whomever is wearing the title of forests minister.

Later today, when the Legislative Assembly resumes sitting, the man on the hot seat will be Doug Donaldson, the NDP MLA for Stikine — and since July 2017, the province’s minister of forests, lands, natural resource operations and rural development.

Donaldson may expect to come under a withering fire in the legislature from the opposition BC Liberals in the coming weeks, and he ought to be forgiven if every once in a while he looks across the aisle at Rich Coleman and recalls that for a very long time the forests minister’s job hasn’t been very much fun. Not at all.

Disclosure note: The writer, Will McMartin, a widely published political analyst and long-time contributor to The Tyee, does political consulting and lobbying in B.C. His clients are not related to the forest industry, nor do they include the current government. [Tyee]