Logging industry

Industry Snapshot

GENERAL INDUSTRY: Natural Resources

CAREER CLUSTER: Agriculture, Food, and Natural Resources

SUBCATEGORY INDUSTRIES: Cutting Timber; Piling Timber; Pulpwood Logging Camps; Rough Wood Rails Manufacturing; Stump Removal; Transporting Timber; Wood Chipping in the Field

RELATED INDUSTRIES:Biofuels Industry; Building Construction Industry; Farming Industry; Natural Resources Management; Paper Manufacturing and Products Industry

ANNUAL DOMESTIC REVENUES: US$13.9 billion (IBISWorld, 2024)

NAICS NUMBER: 1133

Summary

The logging industry is an international business that utilizes an important natural resource for commercial purposes. The myriad wood products of logging and forestry have an equally wide range of uses, and logging serves a number of other important industries, such as papermaking, furniture manufacturing, and construction. The industry employs hundreds of thousands of workers throughout the world. It forms an important part of the economies of countries throughout the world, including industrialized nations.

History of the Industry

The logging industry owes its roots to some of the earliest human civilizations. Archaeologists have found evidence of the extensive use of wood in early architecture, furniture making, and other ancient crafts and industries—at sites in Jericho (in Israel) and in many sites in what is now Turkey—dating as far back as the Neolithic period, or New Stone Age (approximately 9500 B.C.E.). Neolithic civilizations originally used the trees closest to them for construction, but large settlements quickly exhausted that supply and obtained more wood by harvesting great numbers of trees from nearby mountain ranges. They used this wood in building foundations, walls, and rooftops, as well as in furniture and decorations. In ancient China, wood was also harvested during the late Neolithic period. The Chinese also began clearing forests in order to establish farms along the Yellow River around 5500 B.C.E.

During the third millennium B.C.E., the first examples of the logging industry came into being. Ancient Egypt, lacking an adequate volume of local trees, looked to Byblos (modern-day Lebanon) to meet its growing demand for wood. The first pharaoh of Egypt’s fourth dynasty, Snefru (or Sneferu), ordered forty ships filled with cedar from Byblos. Snefru and his successors saw a constant need to import wood, which they used to build and maintain the Egyptian fleet.

The availability of major wood resources in the Near East played a major role in the desire of ancient civilizations to build durable ships and buildings. In fact, wood was considered precious, accorded a value similar to that of gold and silver. In the twenty-third century B.C.E., Mesopotamian king Sargon of Akkad claimed that the god Dagan gave him a vast territory to rule that included a number of heavily forested areas, implying that those forests were part of his wealth. Some of Sargon’s successors made similar claims.

The Roman Empire—like many other civilizations—used Middle Eastern lumber for shipbuilding, construction, and other important endeavors. Additionally, the Roman Empire expanded its resources to include ceramics, advanced weaponry, and other technologies. The vast empire’s needs for wood and wood-based fire to fuel those technologies were great. In fact, the forests of the Lebanese mountains were not enough to satisfy the Romans’ needs. Rather, many of the Romans’ operations had to be moved to the heavily forested regions of what is now Germany.

By the advent of European colonialism in the fifteenth and sixteenth centuries, Europe had become extremely developed, and its forest resources were dwindling rapidly. When explorers came to the shores of the New World, they recognized its enormous potential for logging. The landscape was tremendous and untapped. Soon, ships traveling back to Europe contained large quantities of timber. The birth of the United States in the late eighteenth century continued this trend, as northern New England continued to be logged, both to build American houses and ships and to export timber to Europe.

The significance of the burgeoning logging industry was soon symbolized on the Massachusetts State House: A large golden pine cone was placed atop the building’s dome as an homage to the importance of Maine (which was at the time part of the Massachusetts Bay Colony) and its successful logging industry. Maine (in particular, the city of Bangor) had become the largest logging center in the world, moving over 8 trillion feet of timber between 1832 and 1838. During the mid-nineteenth century, Maine and the rest of the northeastern United States saw the rise of another industry—papermaking—that added to the enormous demand for wood and logging.

The logging industry was long a linchpin of the American economy, and it became part of the new nation’s cultural heritage. As Americans moved westward, much of their culture developed alongside logging. For example, the stories of Paul Bunyan, a giant lumberjack, and his pet ox Babe were part of the American mythology during its early years. As American movement westward continued, New England was joined by other major logging operations. In particular, the Pacific Northwest had become an important center for the industry by the early twentieth century, producing nearly 8 billion board feet in 1926. Washington State replaced Maine as the country’s top lumber-producing state, sending exported wood as far away as China and Australia.

The Industry Today

The logging industry is a global, multibillion-dollar business. It provides wood supplies that are crucial for construction, papermaking, and other uses. Countless types of wood are collected in the myriad forested areas around the world. The list of leading wood- and timber-exporting nations varies in rank based on the type of product being exported, such as fiberboard, paper, plywood, and other materials. Ten countries contain 66 percent of the world's forests. The United States is both a major exporter and a major importer of certain types of wood products. Among the other leaders are Southeast Asian countries such as Malaysia, Vietnam, and Myanmar, as well as Canada.

One of the benefits of wood as a natural resource is that it is found in nearly every part of the world. Although highly developed, the United States still contains large forest tracts, many of which have been purchased for the purposes of logging. Canada, Russia, and many European countries also contain considerable forested areas dedicated to logging. A significant proportion of these industrialized nations’ forest resources is at least somewhat sustainable. When trees are harvested, they may be replaced with tree farms and nurseries. Such practices ensure that this vital natural resource is not completely eradicated.

The same care is not taken in many developing countries. Often, these countries lack viable manufactured products, crops, or other natural resources to drive economic development, so they have turned to timber. Logging has been both beneficial and harmful to these countries. The industry provides jobs, creates products for domestic and foreign sale, and increases the acreage of arable land. However, the logging pursuits of many developing countries have not been planned or executed in a sustainable fashion. In places such as Haiti, Brazil, much of Africa, and Southeast Asia, forest resources have been heavily logged without replacement. In Haiti, this practice has left a once highly forested nation barren of trees, while the country remains extremely poor. In regions with large rain forests, the removal of trees for short-term economic gain has generated considerable controversy among environmentalists concerned with the depletion of the ozone layer. Failure to replace trees also can lead to landslides and other dangers.

The logging industry may be separated into three major components. The first of these segments harvests timber. Cutters, traditionally known as lumberjacks, travel deep into forests and begin their work—first removing branches and large limbs, and then sawing down the large trunks of trees. This part of the industry is one of the most dangerous, as lumberjacks need to climb high into trees and use heavy and light machinery that can cause serious injury. Furthermore, the location of the work performed is often far from the nearest hospital, adding to the physical risks when accidents occur.

The industry’s second segment transports timber. Workers pick up felled trees and move them to locations for processing. The felled timber may be transported by flatbed trucks or floated down rivers on barges or as makeshift rafts assembled by bundling the logs themselves. The latter practice, one of the longest-used tactics in logging, is also one of the most efficient and inexpensive options.

The third component of the industry processes trees into usable commodities. Timber has myriad uses. Some is cut down into boards and blocks of varying shapes and dimensions, while other quantities of it are processed into pulp for paper or into concentrated packs for fireplace logs. Mills and processing plants have long constituted the economic lifeblood of many small communities located in rural, forested areas.

The logging industry remains strong in the early twenty-first century. While the increased use of computers and Internet technology has significantly reduced paper use, logging continues to thrive overall as a global business. Demand remains strong for wood and wood-based products on virtually every economic level.

Small Logging Companies

Small logging companies employ fewer than one hundred persons. They are generally local companies, felling timber in a particular forest or forested region. As a result, their fortunes may be tied to those of their region to a greater extent than is the case for larger companies.

Potential Annual Earnings Scale. The average earnings for employees of small logging companies vary based on the work performed and the volume of work available, as well as the number of employees at the company. Budgets tend to be very tight for these companies in the light of these factors. According to the US Bureau of Labor Statistics, the median annual wage of logging workers in 2022 was $46,580.

Clientele Interaction. The level of client interaction within the logging industry varies based on the position involved. At a small company, employees are more likely to interact with clients than they would be at a larger firm since jobs may be directly negotiated between the loggers and their customers. Payments for such jobs are made immediately following their completion.

Amenities, Atmosphere, and Physical Grounds. Logging and much processing takes place outdoors, in forests. Loggers must work in all types of weather and conditions, living at times in logging camps deep in the forest rather than commuting to work from home. As a result, there is often a general spirit of camaraderie among loggers, especially given the high level of physical risk that accompanies their occupation.

Typical Number of Employees. Some small logging companies employ as few as two people, while others may employ up to one hundred full-time workers. For large jobs, some small companies may hire temporary personnel to augment the full-time staff and enable them to complete the jobs.

Traditional Geographic Locations. Small logging companies operate in areas where large concentrations of harvestable lumber are found, typically small, rural communities adjacent to or within highly forested areas. Such locations facilitate not just logging but also transport to and from logging sites, both of which are conducted with minimal expense to the customer and the company alike.

Pros of Working for a Small Logging Company. Small logging companies offer their employees a degree of comfort and independence that may not be found at larger companies. Employees work closer to home than they would at larger firms, and they are less likely to be required to travel for work. Additionally, a company’s customers themselves are often based nearby and are typically familiar with the company and its employees, developing a stronger relationship than exists between larger companies and their clients.

Cons of Working for a Small Logging Company. Small logging companies are capable of performing only relatively small jobs. As a result, they may not have consistent revenue streams and may therefore be forced to branch out into other types of work. Small firms’ limited budgets also limit the amount of wages they can pay, which are generally below the industry average. They may not be able to afford training for their employees, which can increase the prevalence of on-the-job injuries. Furthermore, many companies are so small that their employees cannot afford full health insurance, so any injuries they incur may be costly. Finally, when economic conditions deteriorate, small companies do not have the ability to adapt and reorganize in the same manner that larger companies can; company closures occur frequently, as do job losses.

Costs

Payroll and Benefits: Pay and benefits for small logging companies depend largely on the jobs involved. Generally, pay for employees of small logging companies is below average, in large part because of the limited scope of work performed by a small number of workers. Workers are typically paid by the job as opposed to earning a salary or hourly wages. Benefits are typically limited by a company’s small workforce and budget.

Supplies: Small logging companies require a number of important tools and pieces of hardware. Among them are motorized saws, axes and similar cutting equipment, climbing equipment, and towing equipment. Additionally, they may require modified trucks, cranes, backhoes, and other heavy machinery in order to remove and transport felled trees and limbs. If they own their own equipment, they must also have smaller tools and oil on hand to maintain this equipment.

External Services: Many small logging companies do not own their own equipment. Instead, they rent equipment from vendors. Additionally, they may need accountants to manage their finances and taxes and Internet marketing consultants to develop and maintain Web sites. They may also need to contract mechanics to fix broken machinery and vehicles.

Utilities: Among the utilities used by small logging companies are gasoline and oil, used to power and maintain heavy and light equipment, as well as trucks and similar vehicles. If they have their own office space, such companies may pay for telephone lines and electricity as well.

Taxes: Small logging companies must collect and report employee income taxes, as well as pay their own corporate income taxes. If these companies have the minimum number of employees to meet the standards of state or regional government requirements, they may be liable for unemployment insurance. If they own their own business space, they must also pay property taxes.

Midsize Logging Companies

Midsize logging companies employ between 100 and 250 persons. While less tied to a specific location than are small companies, they are often still largely regional entities, cultivating and dependent upon local relationships and infrastructure.

Potential Annual Earnings Scale. According to the US Bureau of Labor Statistics, the median annual wage of logging workers in 2022 was $46,580. Midsize companies are likely to pay wages in accord with the industry average.

Clientele Interaction. The level of clientele interaction experienced by a midsize logging company employee depends largely on the employee’s position. A company’s owners or business managers will speak and coordinate directly with clients, as will administrative personnel, who may answer phones, take orders, and maintain records. Cutters and haulers may have little, if any, interaction with clients.

Amenities, Atmosphere, and Physical Grounds. Midsize logging companies operate in two types of environments. The first is the main office environment, in which records are kept, vehicles are stored and maintained, and sales are conducted. This environment is professional, with personnel performing a range of pertinent tasks to support the work being done on site. The second environment is the field, the forests in which logging camps are located. Loggers in the field experience unpredictable working conditions, involving variable weather conditions and physical dangers. Employees in both environments must remain in close contact with one another in order to ensure that each job is managed professionally while the safety and well-being of loggers is maintained.

Typical Number of Employees. Midsize logging companies have from 100 to 250 full-time employees. This number may be quite variable at a given company, fluctuating with the demand for the company’s services.

Traditional Geographic Locations. Midsize logging companies may be found in municipalities in or near heavily forested areas in order to facilitate cost-effective logging and hauling. However, some companies maintain headquarters in larger cities and communities from which they coordinate logging activities in the field. While on a job, loggers reside in forested areas, operating out of logging camps and similar venues.

Pros of Working for a Midsize Logging Company. Employees of midsize logging companies are able to work on a diverse number of projects, from commercial logging to clearing and landscaping. They often have more consistent work opportunities than do employees of smaller companies. Additionally, the larger volume of available work may entail more competitive pay and benefits. Midsize companies, by virtue of having larger budgets, may also be able to afford better equipment and training for employees, which can help reduce the risk of injury.

Cons of Working for a Midsize Logging Company. Although the pay and benefits for midsize logging company employees is competitive, the physical risk remains, especially given the fact that these companies may perform larger, more dangerous jobs than do smaller companies. Additionally, the logging industry as a whole is still subject to significant ebbs and flows, which can result in work stoppage and workforce reductions. Midsize companies may also have a competitive disadvantage in comparison to larger companies that can offer better machinery and more personnel.

Costs

Payroll and Benefits: Midsize companies have more diverse pay scales than smaller companies. In addition to loggers, truck drivers, and field workers, these companies employ senior managers, who command higher salaries, and lower-level administrative personnel.

Supplies: Midsize logging companies use office supplies such as stationery, business cards, accounting and filing materials, and telecommunication equipment. Logging operations require heavy equipment, such as cranes and backhoes; light equipment, such as chain saws and trimmers; parts and tools to maintain and repair the equipment; hand tools; and transport vehicles.

External Services: Midsize logging companies have more resources than do small companies, so they may address many of their needs internally. However, they may still rent equipment or vehicles and hire outside maintenance services. Additionally, many outsource accounting, website design, marketing, and advertising.

Utilities: Midsize logging companies use a large amount of gasoline and oil to fuel heavy and light logging equipment, as well as transportation vehicles. Additionally, they require electricity and telephone services for their headquarters, as well as cellular phones for on-site personnel.

Taxes: Like most companies, midsize logging companies must withhold income taxes from employees, as well as reporting their own corporate income taxes. If they own their own headquarters or storage space, they must pay commercial real estate taxes. In many areas, companies must pay taxes to fund health insurance programs and unemployment insurance pools.

Large Logging Companies

Large logging companies have more than 250 employees. Rather than being tied to a particular region, a large company is likely to have multiple operations in multiple regions, while being headquartered in an urban center removed from those operations. It may even be based in a different country from those in which its operations are carried out. Large companies are more likely to be involved in every aspect of logging, including the processing of timber into wood and paper products.

Potential Annual Earnings Scale. The employees of larger logging companies, by virtue of the generally larger volume of high-value jobs on hand, have a greater potential to earn competitive salaries. However, larger companies also have more diverse employee groupings. The highest end of a company’s pay scale will be occupied by its salaried executives, while field workers and administrative employees are usually paid hourly and at lower wages.

Clientele Interaction. The level of interaction between a large logging company employee and the company’s clients depends largely on the position held by the employee. Much client interaction is left to those employees who manage jobs from the corporate headquarters, including administrative personnel who oversee accounting and client relationships. Moreover, during the course of prospecting, business development managers have a high degree of interaction with potential new clients.

Amenities, Atmosphere, and Physical Grounds. Logging workers in the field must deal with certain risks and dangers, long hours, and physically demanding work. These workers tend to work closely with other cutters and lumber industry personnel. Personnel employed at a corporate headquarters or regional office must work together to ensure the safety and effective teamwork of those in the field. In both cases, personnel must act in a particularly tight group dynamic in order to complete their projects effectively.

Typical Number of Employees. Large logging companies have anywhere from 250 to thousands of full-time employees. For example, Canada’s AbitibiBowater, one of the world’s largest logging and paper companies, employed about 18,000 workers before it declared bankruptcy in 2009.

Traditional Geographic Locations. Large logging companies are often international corporations. They have headquarters in major cities, along with subsidiary offices and facilities in or near forested areas, with logging camps and mills established within each region of operation. In some cases, these businesses are multinational companies, conducting logging, processing, and transferring operations in and among various countries while maintaining their home bases elsewhere.

Pros of Working at a Large Logging Company. Employees of a large logging company are part of a sizable network that potentially offers a wide range of work options, leading to work diversity and opportunities for advancement. In addition, because such a company’s contracts tend to be lucrative, worker pay and benefits are often better than at midsize and small logging companies. Large firms tend to have more buying power, enabling them to equip workers with the best trade tools. They can also afford to train employees in the use of their equipment. Furthermore, in the event of an economic downturn, large companies are often more resilient, able to downsize or reorganize rather than folding completely.

Cons of Working for a Large Logging Company. Because many large logging companies are multinational and not specific to a certain region, workers may be transferred to job sites and subsidiary locations away from home or even out of the country. Employees do not necessarily have a chance to cultivate familiarity with a given region or forest and to help steward its continued sustainability. Additionally, large companies’ broad operational reach leaves them susceptible to broad economic issues. For example, when stocks fall or national economies falter, larger companies with stakes in foreign countries may suffer as well.

Costs

Payroll and Benefits: Pay and benefits for employees of large logging companies are among the most competitive in the industry. Executives earn the highest industry salaries, while administrative and hourly employees tend to earn lower base pay. Those working on at-risk job sites may also enjoy greater health, disability, and life insurance benefits than would employees working for small or midsize firms.

Supplies: Large logging companies require a great deal of equipment, both heavy and light, as well as the means and materials to maintain it. They also need large vehicles of all kinds to facilitate the transfer of harvested lumber. They also need factory equipment and materials to process lumber into commodities. Furthermore, they require a considerable quantity of office supplies, computer hardware, and software at corporate locations to maintain contact with worksites and subsidiaries, generate new business, and conduct internal operations.

External Services: Although much of the operations conducted by large logging companies are managed internally, these companies may still require the services of a number of external vendors. One of the largest external services is transportation—from trucking to rail to air and water shipping companies. Additionally, many large companies contract public relations companies and legal representation, as well as lobbyists to advance their agendas at state, regional, and national capitols.

Utilities: Large logging companies, particularly those with large corporate headquarters and regional offices, use a large quantity of utilities. Among these utilities are electricity and other energy resources. Large companies also require extensive telephone and Internet services in order to generate new business, as well as for internal communications among regional offices and with remote worksites.

Taxes: Large logging companies are required to withhold employee income taxes, as well as to report their own corporate income taxes on state, regional, and national levels. Many are also required to contribute to public unemployment insurance and health insurance pools. Because of these companies’ multinational operations, many national and international leaders are seeking to increase the taxes levied for global logging operations in an effort to curtail those operations in order to combat global warming.

Industry Outlook

Overview

In many societies, the logging industry has long had a degree of nobility attached to it. In lands with rich forests, including the United States and Canada, those who engaged in the felling of trees projected an image of strength and courage. Today, loggers retain that image, as their line of work continues to require great physical strength and fearlessness. The logging industry has undergone a steady evolution, however, during a period of change that coincided with the need to sell a viable natural resource. In developing countries, the wood trade has skyrocketed, spurring the creation of multinational corporations that remove large swaths of forest in regions with delicate ecosystems (as well as illegal deforestation and logging operations).

Southeast and southern Asia, for example, have long been rich with rain forests and tropical timber, and the market for their wood products on the international stage has been consistently strong. In 2019, more than 4.2 million people were employed in the forestry and logging industry in the Asia-Pacific region.

The increasingly unsustainable clearing of tropical forests in particular has generated a political backlash, especially in the light of growing concerns about global warming and climate change. Forest conservation has seen growth as an industry in the early twenty-first century, while logging has remained stagnant. Conservation was long part of the overall logging industry since loggers were often called upon to clear overgrown forest areas.

Political concerns are not the only factor causing stagnation in the logging industry. Logging has benefited from the appearance of improved technologies. Modern technology has rendered the dual saw and the axe obsolete, replacing them with high-powered chain saws and other equipment that can fell trees with greater speed and efficiency and with fewer personnel. Furthermore, the increased use of the Internet and computer-based communications has caused a reduced demand for paper. Additionally, the increased number of large, multinational companies has reduced the number of midsize and smaller companies, as these larger companies have either absorbed the smaller ones or put them out of business.

Another element playing a major role in the logging industry’s malaise is the global economy. Logging and forestry are industries that rely on demand. As housing and building construction declined at the start of the 2007–2009 recession, so too did the need for a wide range of hardwoods and other materials. The logging industry thus suffered a major blow as a result of the economic downturn, before entering a recovery stage. As construction picked up through the 2010s, the logging industry followed.

In addition to the politically generated and technological shifts that have created a reduction in logging jobs and production in many locations, another trend is having a significant impact on the industry as a whole. In European and North American forest regions, logging is heavily regulated and carefully monitored. This regulation can increase the price of logging operations. The considerably lower cost of felling and manufacturing timber and related products in developing countries is causing many operations to move to those countries.

Adding to the challenges facing the logging and timber industry is the fact that illegal logging has grown exponentially, particularly in the aforementioned developing countries. Illegal logging entails crews clearing undesignated areas or failing to report income to tax agencies. According to the World Wide Fund for Nature (WWF; formerly the World Wildlife Fund), the practice is extensive. In Bulgaria, for example, 45 percent of the entire timber harvest is illegally obtained. The World Bank estimates that illegal logging drains $10 billion each year from the global market as well as $5 billion in tax revenues. It drives prices down by as much as 16 percent. This growing trend, which shows no sign of abatement, will likely continue negatively to affect the legitimate logging industry’s growth in the foreseeable future.

Employment Advantages

Employees in the logging industry, particularly those who are employed to cut and transfer timber, are potentially offered a great deal of excitement and adventure. They work predominantly in the outdoors in often picturesque environments. Those who seek to use their strength and familiarity with a wide range of tools find logging work to be extremely satisfying.

The logging industry has suffered a decline over the last several years as a result of economic and environmental concerns, as well as illegal logging activities and changes in technology. Despite declines in the number of loggers and companies operating successfully in the industry, the logging industry still remains global and profitable.

Although much debate continues over unsustainable and illegal logging’s impact on the environment, the legitimate logging industry enables workers to respond to one of the world’s most vital and longest-standing natural resource needs. Wood meets an abundance of demands—from energy to construction materials to paper—and those engaged in this global industry work to meet that demand.

Annual Earnings

Overall, the global logging and forest-products industry generates hundreds of billions of dollars in earnings per year. In the United States, which is both a major producer of timber and a major wood-products importer, that figure was about $16 billion in 2022. The greatest growth in the industry comes from East and Southeast Asian countries, where a wide range of high-demand woods and wood products is being exported by both legitimate, taxpaying businesses and illegal operations whose revenue figures are difficult to determine. Illegal logging has a significant impact on industry revenues. According to studies, if illegal operations ceased, countries with little illegal logging (such as the United States and Canada) would experience almost a doubling in their logging revenues, while worldwide inventories of harvestable forest would increase.

In an increasingly global economy, an important factor in discussing the performance of the logging industry is the quantity of wood and wood products exported by a given nation. Canada, for example, has long stood as the largest exporter of wood and wood products, with over $20.1 billion in exports in 2022. The majority of Canada's wood products were exported to the United States.

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