6 Facts About Michigan’s Booming Forest Products Industry

Michigan’s expanding forest products industry contributes more than $26 billion to the state’s economy

Photo: Timber is loaded onto a trailer for transport. Michigan’s forest products industry is expanding, thanks to new investment from global companies such as Arauco, which opened a Grayling plant in 2019. Photo: State of Michigan

Michigan’s forest products industry has hit a new peak, adding $26.5 billion to Michigan’s economy, according to new data released by the Michigan Department of Natural Resources.

That figure represents the industry’s impact in 2022, the most recent available figures, and is up $4 billion from 2019.

The forest products industry encompasses forestry, logging, wood furniture, pulp, paper, paperboard products, and woody biomass power generation. “Michigan’s forests provide a sustainable source for building materials, furniture, and paper and cardboard products,” said Jeff Stampfly, chief of the DNR’s Forest Resources Division and the state forester.

A Major Economic Contributor

Michigan’s forest products industry is booming, contributing over $26.5 billion to the state’s economy in 2022. According to the Michigan Department of Natural Resources (DNR), this marks a $4 billion increase from 2019.

Economic Impact and Growth

The industry has seen substantial growth despite a 3.6% decrease in direct employment. “All other economic indicators show significant growth,” said Jagdish Poudel, DNR forest economist. Indicators such as average wage, labor income, output, and industry productivity have all improved.

Driving Factors

Arauco, the world’s largest particleboard manufacturer, opened a $450 million facility in Grayling in 2019. This facility alone creates about 220 jobs, which in turn generate additional economic benefits. The industry’s total output benefits from strong links to other sectors.

Sustainability Efforts

Michigan’s 20.2 million acres of forest cover about half the state. Nearly 4 million acres are DNR-managed state forest lands. The DNR collaborates with the industry to support its growth. The woody biomass power generation sector alone creates around 120 jobs. This sustainable power uses low-value materials such as mill residues and logging residues.

Employment and Wages

In 2022, the forest products industry provided 40,449 direct jobs and supported a total of 88,275 jobs. “Each job in the forest products industry generates an additional 1.1 jobs in the economy,” Poudel said. The average wage in this industry is nearly $80,000 annually.

Sector Breakdown

The largest sector, pulp, paper, paperboard, and other paper products, had a direct output of $7.7 billion. Primary and secondary solid wood products generated nearly $5.6 billion in direct output. Wood furniture produced about $2.4 billion, and forestry and logging about $470 million.

Conclusion

Michigan’s forest products industry continues to grow, supporting jobs and sustainable practices. The DNR remains committed to fostering this vital sector, ensuring its economic and environmental benefits endure for future generations.

Source: Michigan.gov/dnr