This indicator provides information on the level of direct and indirect employment in the forest sector. Employment is a widely understood measure of economic, social and community wellbeing.
Forest management and timber processing are seen as one of the drivers of regional economic activity in New Zealand. The sector is a significant employer in its own right and underpins economic activity in several regional towns and centres. The sector also has significant downstream employment in further processing and support services, such as transportation, furniture manufacturing and timber wholesaling. The wide geographical spread of the forest estate means employment opportunities exist in nearly all districts. These opportunities include not only operational activities in the forest or mill but also positions in marketing, accounting and management. Employment activity has declined over the past decade, due to a combination of increasing productivity, restructuring within the sector and changes in market and foreign exchange conditions. Longer term, the potential exists for additional employment opportunities as the plantings of the 1990s mature and new uses for timber fibre are commercialised.
The central North Island has the largest number of workers employed in forestry and first-stage timber processing. The region had 37.6 percent of direct forestry employment in 2013. This concentration of employment reflects the distribution of mature forests and processing capacity.
The New Zealand Forest Service sought to broaden the distribution of plantings in the decades following the Second World War, with the establishment of new planted forests in regions such as Northland, Nelson/ Marlborough and Otago/ Southland. Private investors also took on a larger role in forestry development during this period. A noticeable development was the growth in small, farm forestry plantings. These plantings have created a geographically dispersed estate. The maturing of these plantings from the 1990s has enabled regional harvest rates to be sustainably increased over the past 20 years.
The increase in regional harvest activity led to a period of new investment in processing facilities during the 1990s and the early part of this century. This generated employment growth across the country. The growth in regional harvest volumes generated additional employment across the country.
In looking at forestry employment activity, it is important to examine not only direct employment but also indirect and induced workforce activity. In the Otago/Southland region, the indirect and induced impacts of the sector generated a further 3,047 FTEs and $214 million in real GDP elsewhere in the region. In broad terms every one FTE employed in the sector generates a further 1.3 FTEs elsewhere in the region. A similar study in the Marlborough district found that, including indirect and induced effects, the forest industry generated $170 million in regional GDP and employed 1,090 FTEs in the year ending March 2007.
The forestry sector has been a significant contributor to employment and economic activity in New Zealand since the mid-19th century. The modern picture of the sector is of a diversified industry, with employment opportunities ranging from logging and sawmilling through to laminated veneer, pulp and paper manufacturing, energy production and research on bio-material applications.
In 2002 nine regions had over a thousand workers directly employed in forestry management, harvesting or first-stage processing. While the level of forestry employment has declined over the past decade, the sector remains a significant employer across the country.
Over the past 10 years, the forestry sector has seen a decline in employment activity. This has been due to improvements in productivity, along with market and exchange rate conditions. The sawmilling and processing sectors have experienced tight margins over several years (for both domestic and export markets). This has led to a number of mill closures and initiatives to improve mill throughput and productivity. The rise in the log harvest over the past four years has stabilised the employment levels in forestry and logging.
Between 2002 and 2013, the workforce engaged in forestry and first-stage processing has declined by around 30 percent. All 10 wood supply regions have seen a reduction in employment activity. The central North Island has seen the largest fall, with the employee count declining by 3977 or 38 percent.
The downturn in new planting at the beginning of the century, and tight economic conditions, had a significant impact on the number of workers employed in nursery operations, site preparation, planting and silviculture (that is, support services). This segment of the industry declined by 1550 workers between 2002 and 2007. The workforce has stabilised in more recent years.