the economic importance of the maryland forest products industry prepared for and property of the...

The Economic Importance of the Maryland Forest Products Industry

Prepared for and Property of theMaryland Eastern Shore Resource Conservation & Development Council, Inc. and

the Maryland Department of Natural Resources - Forest Service____________________

Funded by:United States Department of Agriculture, Forest Service

Primary Authors:

Duncan Hilchey,Cornell University

David Kay,Cornell University

The Economic Importance of the Maryland Forest Products Industry 2

The Economic Importance of the Maryland Forest Products Industry

Summary

Maryland’s forestry and wood-products industry constituted over $2 billion in output value in

1996, and provided nearly 14,000 jobs. While secondary wood manufacturing (e.g., cardboard-

box production) provides the most employment opportunities, the primary wood-manufacturing

sectors (e.g., saw mills and paper mills) have higher employment multipliers. This indicates the

primary wood manufacturers role between raw forest products and finished wood products. In

fact, primary wood-manufacturing sectors are, on average, higher than other average multipliers

of industries in the state.

Shock analysis (using IMPLAN) suggests that a 10% reduction or increase in the value of

primary wood-manufacturing industry output would have a profound impact on the state’s

economy.


Table of Contents

Summary 2List of Tables and Charts 4

Forestry and Wood Products Industry Definitions 5

Maryland Region Definitions 6IMPLAN Model 7General Industry Data 8

Output 9Employment 10Value-Added 11

Multipliers 14Output 15Employment 21Value-Added 28

Shock Analysis 33

Output 34

Employment 35

Value-Added 36

Statistical Summary 37

Appendix:

About IMPLAN 38

Subsector Source Data Files 42-52

About the Authors 53


List of Tables and Charts

Chart 1 Maryland Statewide Forestry and Wood Products industry Output by Sector9

Table 1 Maryland Forestry and Wood Products Industry

Output by Sector and Region 10

Chart 2 Maryland Forestry and Wood Products Output by

Region 11

Table 2 Maryland Forestry and Wood Products

Employment by Sector 12

Table 3 Maryland Forestry and Wood Products

Value Added by Sector 13

Chart 3 Mean Output Multipliers for Forestry and Wood

Products Industry and All Industries, Maryland 16

Chart 4 Central Region 17

Chart 5 Eastern Region 18

Chart 6 Southern Region 19

Chart 7 Western Region 20

Chart 8 Mean Employment Multipliers for Forestry and Wood






Chart 13 Mean Value Added Multipliers for Forestry and Wood






Table 4 Change in the Value of Industrial Output as a Result of

-10%, +10% and +20% Shifts in the Value of Output in the Primary Wood Manufacturing Sector 34

Table 5 Change in the Number of Jobs as a Result of -10%, +10% and +20% Shifts in the Value of Output in the Primary Wood Manufacturing Sector 35

Table 6 Change in Value-Added as a Result of -10%, +10% and +20% Shifts in the Value of Output in the Primary Wood Manufacturing Sector 36


Forestry and Wood Products Industry Definitions

Following the industry definition originally developed by the U.S. Forestry Service, this study divides the forestry industry into three major categories:

Timber Management and Harvesting Operation of timber tracts, tree farms, forest nurseries Reforestation services Other forest products Harvesting and transporting logs Producing rough, round, hewn or riven primary forest or wood raw

materials Producing wood chips

Primary Wood Manufacturing Processing of logs and related products into lumber, veneer and plywood,

pulp and turpentine and other products Secondary Wood Manufacturing

Remanufacture of lumber, plywood, paper and other timber products produced by the primary manufacturers into finished products, such as furniture, toys, containers, etc.


Maryland Region Definitions

The data analysis in this report defines four regions of Maryland, divided as follows:

Central: Carroll, Baltimore, Harford, Cecil, Montgomery and Howard

Counties Eastern:

Kent, Queen Anne’s, Talbot, Caroline, Dorchester, Wicomico, Worcester and Somerset Counties

Southern: Anne Arundel, Prince George’s, Calvert, Charles and St. Mary’s

Counties Western:

Garrett, Allegany, Washington and Frederick Counties


The IMPLAN Model

The data analysis in this report is conducted using the IMPLAN Model:

Model: IMPLAN is a widely regarded, inter-industry Input-Output Model

that was developed, in part, by the United States Department of Agriculture’s Forest Service.

IMPLAN is a “non-survey” Input-Output Model utilizing available data to estimate the flow of goods and services at national, state, and county levels.

Data: IMPLAN analysis is based on highly credible data sources to

include: The United States Population Census, County Business Patterns, Regional Economic Information System (REIS) data, and the annual BLS ES-202 wage and employment data.

The quality of data used by IMPLAN is one of its primary strengths.


General Industry Information

Output Value

Employment

Value-Added


Forestry and Wood Products Combined Are a $2 Billion Industry in Maryland

CHART 1: Maryland Statewide Forestry and Wood-Products Direct Industry Output by Sector

Timber Management and

Harvesting11%

Secondary Wood Manufacturing

56%

Primary Wood Manufacturing

33%

Data for 1996; data excluded for city of Baltimore.Source: IMPLAN Pro; copyright Minnesota IMPLAN Group, Inc.

($1.2 billion)

($230 million)

($720 million)


The Forestry and Wood-Manufacturing Sectors Tend to Concentrate by Region

All regions in Maryland support some level of forestry and wood manufacturing. However, sectors tend to be regionally concentrated: Timber Management and Harvesting in the Eastern region; Primary Wood Manufacturing in the Western region; and Secondary Wood Manufacturing in the Central region.

TABLE 1: MARYLAND FORESTRY AND WOOD-PRODUCTS DIRECT INDUSTRY OUTPUT BY SECTOR AND REGION

Total

$ (millions) % $ (millions) % $ (millions) % $ (millions)

State $230 11% $720 33% $1,234 56% $2,184

Central $29 4% $75 11% $601 85% $705

Eastern $139 40% $70 20% $140 40% $350

Southern $26 11% $39 16% $181 74% $246

Western $36 6% $484 78% $104 17% $623

Data is for 1996; data excluded for city of Baltimore.

Source: IMPLAN Pro; copyright Minnesota IMPLAN Group, Inc.

OUTPUT (in millions)

Timber Management and Harvesting


Secondary Wood Manufacturing


Maryland’s Forestry and Wood-Products Industry is Important to All Regions of the State

Maryland’s Central and Western regions account for over two-thirds of the state’s forestry and wood products annual output value. However, at one-quarter and one-third of a billion dollars, respectively, Southern and Eastern Maryland’s forestry and wood-products industry output is significant to the rural economy.

Central37%

Western32%

Eastern18%

Southern13%

CHART 2: Maryland Forestry and Wood Products Direct Industry Output by Region

Data for 1996; data excluded for city of Baltimore.Source: IMPLAN Pro; copyright Minnesota IMPLAN Group, Inc.

($705 million)

($349 million)

($623 million)

($246 million)


Maryland’s Forestry and Wood Products Industry Creates Almost 14,000 Jobs

Secondary Wood Manufacturing provides the most employment opportunities, with jobs in this sector being concentrated in the Central region of the state. Employment in Primary Wood Manufacturing is highly concentrated in the Western region of Maryland. This is principally due to the presence of paper mills and other types of wood products mills. Jobs in Timber Management and Harvesting sectors are somewhat concentrated in the Eastern region.

TABLE 2: MARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY EMPLOYMENT

Timber Management and

HarvestingPrimary Wood Manufacturing

Secondary Wood Manufacturing Total

State 1,375 3,449 9,074 13,898

Central 173 392 4,325 4,890

Eastern 749 441 915 2,105

Southern 154 240 1,324 1,718

Western 294 2,237 931 3,462



EMPLOYMENT (in FTEs)


Forestry Industry Contributes $.75 Billion in Value-Added Economic Activity in Maryland

In addition to providing employment and income for many Maryland residents, the forestry and wood products industry generates income for business owners, property income, and indirect business taxes — all benefits to a vibrant state economy.

TABLE 3: MARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY VALUE-ADDED BY SECTOR

Timber Management and Harvesting


Secondary Wood Manufacturing Total

State $105.95 $248.76 $404.53 $759.23

Central $13.53 $20.71 $193.14 $227.37

Eastern $63.54 $19.59 $37.87 $121.00

Southern $13.00 $11.70 $70.12 $94.83

Western $15.38 $183.16 $35.31 $233.85



VALUE ADDED (in millions)


Forestry and Wood-Products Industry Multipliers

Output Multipliers

Employment Multipliers

Value-Added Multipliers


Output Multipliers


For Every Dollar of Forestry Output Value Generated, Another Dollar is Produced Elsewhere in the Maryland Economy

1.93 2.15 2.04 2.05 2.11

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Mu

ltip

lier

Timber Managementand Harvesting

Sectors

Primary WoodManufacturing

Sectors

Secondary WoodManufacturing

Sectors

ALL Forestry andWood Manufacturing

Sectors

All 528 Industries inState

CHART 3: Mean Output Multipliers for Forestry and Wood-Products Industry and All Industries, Maryland (Statewide), 1996

Data for 1996; data excluded for city of Baltimore. Source: IMPLAN Pro, Minnesota IMPLAN Group, Inc.


The Central Maryland Forestry and Wood-Products Industry Has A Higher Mean Output Multiplier Than All Other Industries in the Region

1.61 1.74 1.761.74 1.82

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Mu

ltip

lier


Sectors


Sectors


Sectors


Sectors

All Industries inRegion

CHART 4: Mean Output Multipliers for Forestry and Wood-Products Industry and All Industries, Central Maryland, 1996



The Eastern Maryland Forestry and Wood-Products Industry Has a Higher Mean Output Multiplier Than All Other Industries in the Region

1.72

2.14 1.97 1.961.89

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Mu

ltip

lie

r


Sectors


Sectors


Sectors


Sectors


CHART 5: Mean Output Multipliers for Forestry and Wood-Products Industry and All Industries, Eastern Maryland, 1996



The Southern Maryland Forestry and Wood-Products Industry Has a Mean Output Multiplier Comparable to Other Industries in the Region

1.701.92 1.84 1.82 1.91

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Mu

ltip

lier


Sectors


Sectors


Sectors


Sectors


CHART 6: Mean Output Multipliers for Forestry and Wood-Products Industry and All Industries, Southern Maryland, 1996



The Western Maryland Forestry and Wood-Products Industry Has a Mean Output Multiplier Comparable to Other Industries in the Region

1.711.91 1.90 1.84 1.93

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Mu

ltip

lier

TimberManagement and

Harvesting Sectors


Sectors


Sectors


Sectors


CHART 7: Mean Output Multipliers for Forestry and Wood-Products Industry and All Industries, Western Maryland, 1996



Employment Multipliers


Primary Wood Manufacturing Has a Higher Mean Employment Multiplier Than the Average of All Other Maryland Industries

2.95

3.83

2.803.05 3.24

0.00

1.00

2.00

3.00

4.00


Harvesting


SecondaryWood

Manufacturing

ALL Forestryand Wood

Manufacturing

All Industries inMaryland

CHART 8: Mean Employment Multipliers for the Forestry and Wood-Products Industy and All Industries, Maryland (Statewide), 1996

In contrast to timber management and harvesting, mean employment multipliers in primary wood manufacturing exceed the mean for all other industries in Maryland. These multipliers suggest that growth in primary wood manufacturing has a greater propensity to create employment than other sectors of the regional and statewide economy. Primary wood manufacturers such as saw mills, hardwood dimension and flooring and paper mills are an important market since they source local raw wood products, and in turn, prepare basic wood products for the secondary wood manufacturers further up the value-adding chain. Thus, they play a crucial role in the overall forestry and wood products industry.


Primary Wood Manufacturing in Central Maryland Has a Higher Mean Employment Multiplier Than the Average of All Other Maryland Industries

2.28

2.84

2.15

2.31 2.56

0.00

1.00

2.00

3.00

4.00

TimberManagement

and Harvesting


SecondaryWood

Manufacturing


Manufacturing


CHART 9: Mean Employment Multipliers for the Forestry and Wood-Products Industy and All Industries, Central Maryland, 1996


All Forestry and Wood Manufacturing Sectors Exceed the Mean Employment Multiplier of All Industries in the Eastern Region

2.98 3.12

2.54 2.72 2.51

0.00

1.00

2.00

3.00

4.00

TimberManagement

and Harvesting


SecondaryWood

Manufacturing


Manufacturing


CHART 10: Mean Employment Multipliers for the Forestry and Wood-Products Industy and All Industries, Eastern Maryland, 1996


Mean Primary Wood-Manufacturing Employment Multipliers Are Significantly Higher Than the Mean for All Industries in the Southern Region

2.52

3.84

2.272.47 2.51

0.00

1.00

2.00

3.00

4.00

TimberManagement

and Harvesting


SecondaryWood

Manufacturing


Manufacturing


CHART 11: Mean Employment Multipliers for the Forestry and Wood-Products Industy and All Industries, Southern Maryland, 1996


2.38

3.17

2.182.47

2.69

0.00

1.00

2.00

3.00

4.00

TimberManagement

and Harvesting


SecondaryWood

Manufacturing


Manufacturing


CHART 12: Mean Employment Multipliers for the Forestry and Wood-Products Industy and All Industries, Western Maryland, 1996

Mean Primary Wood-Manufacturing Employment Multipliers Are Significantly Higher Than the Mean for All Industries in the Western Region


Value-Added Multipliers


Mean Value-Added Multipliers Are Significantly Higher Than the Mean for All Industries in the State

2.30

3.24

2.67 2.77 2.84

0.00

1.00

2.00

3.00

4.00

Mul

tiplie

r


Harvesting



ALL Forestry and Wood

Manufacturing

All Industries inMaryland

CHART 13: Mean Value-Added Multipliers for Forestry and Wood-Products Industries and All Industries, Maryland (Statewide), 1996



Mean Value-Added Multipliers for All of Central Maryland’s Forestry and Wood-Products Are Higher than Average for All Industries in the Region

1.902.51

2.17 2.20

1.44

0.00

1.00

2.00

3.00

4.00

Mu

ltip

lier


Harvesting




Manufacturing


CHART 14: Mean Value-Added Multipliers for Forestry and Wood-Products Industries and All Industries, Central Maryland, 1996



Mean Value-Added Multipliers for All of Eastern Maryland’s Forestry and Wood-Products Are Higher Than Average for All Industries in the Region

2.40

3.08

2.42 2.55 2.39

0.00

1.00

2.00

3.00

4.00

Mu

ltip

lier


Harvesting




Manufacturing


CHART 15: Mean Value-Added Multipliers for Forestry and Wood-Products Industries and All Industries, Eastern Maryland, 1996



The Mean Value-Added Multiplier in Primary Wood Manufacturing Leads the Average of All Industries in Southern Maryland

1.87

2.722.38 2.33 2.40

0.00

1.00

2.00

3.00

4.00

Mu

ltip

lier


Harvesting




Manufacturing


CHART 16: Mean Value-Added Multipliers for Forestry and Wood-Products Industries and All Industries, Southern Maryland, 1996



Primary Wood Manufacturing’s Mean Value-Added Multiplier Leads the Average of Other Sectors in Western Maryland

1.93

2.732.36 2.37 2.43

0.00

1.00

2.00

3.00

4.00

Mu

ltip

lier

TimberManagement &

Harvesting




Manufacturing


CHART 17: Mean Value-Added Multipliers for Forestry and Wood-Products Industries and All Industries, Western Maryland, 1996



Shock Analysis

10% Decline in Primary Wood Manufacturing

10% Growth in Primary Wood Manufacturing

20% Growth in Primary Wood Manufacturing


Shock Analysis for OutputTABLE 4: Change in the value of industrial output as a result of -10%, +10% and +20% shifts in value of output in the primary wood manufacturing sector.

A 10% “shock” in primary wood manufacturing ($72 million) would result in a $156 million shift in the value of all goods and services in the state. Western Maryland, in particular, would feel the greatest impact.

-10% Shift +10% Shift +20% Shift

State -$156,340,021 +$156,340,021 +$312,680,042

Central -$12,838,713 +$12,838,713 +$25,677,426

Eastern -$15,328,185 +$15,328,185 +$30,656,370

Southern -$7,382,306 +$7,382,306 +$14,764,612

Western -$91,495,953 +$91,495,953 +$182,991,906

Data is for 1996; data excludes city of Baltimore.

Source: IMPLAN Pro, copyright Minnesota IMPLAN Group, Inc.

Total Shift in Output ($)


Shock Analysis for EmploymentTABLE 5: Change in the number of jobs as a result of -10%, +10% and +20% shifts in value of output in the primary wood manufacturing industry.

A 10% decline or increase in the value of output in the primary wood manufacturing industry ($72 million) would have a profound impact on jobs. Western Maryland would be most affected.


State -1392 +1,392 +2,784

Central -103 +103 +207

Eastern -143 +143 +287

Southern -68 +68 +136

Western -833 +833 +1,666



Change in Number of Jobs (FTEs)


Shock Analysis for Value-AddedTABLE 6: Change in value-added as a result of -10%, +10% and +20% shifts in value of output in the primary wood manufacturing industry.

Wages, proprietor and property income and indirect taxes would be profoundly impacted by a 10% change in the value of primary wood manufacturing output ($72 million).


State -$76,733,482 +$76,733,482 +$153,466,964

Central -$5,330,504 +$5,330,504 +$10,661,008

Eastern -$6,263,120 +$6,263,120 +$12,526,240

Southern -$3,371,379 +$3,371,379 +$6,742,758

Western -$43,645,473 +$43,645,473 +$87,290,946



Change in Value-Added ($)


Statistical Summary

Forestry and Wood Products Industry: Generates $2 billion in output value Supports 14,000 jobs Contributes $.75 billion in value-added economic activity Has an output multiplier of 2.04 Has an employment multiplier of 3.05 (3.83 for Primary Wood Manufacturing) Has a value-added multiplier of 2.77 (3.24 for Primary Wood Manufacturing)

A 10% decline in Primary Wood Manufacturing Output would: Result in a $156 million loss in value of goods and services in the state Eliminate 1,392 jobs Result in a $77 million loss in value-added economic activity


Appendix: About the IMPLAN Analyses

SUMMARY

IMPLAN is one of a small number of similar interindustry input-output models of local economies. IMPLAN was originally developed by the USDA Forest Service in cooperation with other federal agencies. In order to address the prohibitive cost of extensive primary data collection on local interindustry purchases, IMPLAN and other “nonsurvey” modeling systems combine available data about the national economy with state and county level data to estimate the flow of goods and services through a local economy.

One of IMPLAN’s strengths is the fact that it integrates many sources of data1 at different levels of aggregation into a comprehensive, internally consistent system that can be applied to any county or region in the United States. Although this integration requires numerous assumptions and estimations of data for specific industries in specific counties, great effort is made to make all estimates compatible with the most accurate available measured data. Unfortunately, the agricultural sectors are particularly difficult since there are no employment and earnings data collected on a

1 Major data sources of importance include the population census, County Business Patterns, Regional Economic Information System (REIS) data, and especially the annual BLS ES-202 wage and employment data.

continued


commodity basis, even at the national level. IMPLAN uses specially developed procedures to estimate agricultural employment and income by commodity for all counties at the county level. For these estimates, the key anchoring data bases are the REIS data on total farm employment and income, National Agricultural Statistical Service estimates of value of output by commodity at the state level, and Census of Agriculture estimates of crop acreage by type and of the dollar value of livestock-related commodities. The IMPLAN vendor does offer the sensible caveat that “analysts with better [local] agricultural data are encouraged to use it.” (See the IMPLAN PRO Data Guide, Minnesota IMPLAN Group, Inc., 1996, for more information.)

The overall consistency that is achieved by IMPLAN’s data integration procedures enables a comprehensive analysis of the relationships between all sectors of the economy that is otherwise elusive. The maximum use of county-level data that is available throughout the United States helps makes this modeling approach significantly more defensible than similar estimates based on multipliers “borrowed” from another study or another economy. In particular, multiplier estimates based upon larger state or regional economies typically have multipliers that are too large because they implicitly overestimate local production capabilities.

Up to 528 industry sectors are tracked in the full national IMPLAN model, though local economies typically have only half of these or less present.

continued


MULTIPLIERS

Input-output models can be used to estimate the incremental contribution to a local economy that is attributable to an increase (or decrease) in the purchase and consumption of goods and services. To do this, specific multipliers are calculated for each industry. These multipliers summarize the effects of additional rounds of purchases that are stimulated by the initial increase (decrease) in the demand for the goods and services. The multipliers are then applied to the value of this initial “direct” spending to estimate additional impacts that are “indirect” or “induced.” Indirect impacts focus on the additional interindustry purchases of local production inputs that are stimulated by the initial purchases, i.e, as the industry initially impacted increases orders from its suppliers, who in turn do the same and so on. Indirect impacts do not account for associated local respending of increased returns to factors of production (e.g., workers’ spending of increased wages). Induced impacts, in contrast, are estimates of the additional economic activity stimulated by local respending of, for example, increased incomes.

There are a variety of kinds of multipliers that can be derived for any industry. The two that are often of greatest interest are employment multipliers and output multipliers. Employment multipliers represent the ratio between the total number of jobs that are stimulated economy-wide by an initial “direct” increase in demand for an industry’s product (i.e., including jobs created directly, plus those created through indirect plus induced effects) and only those jobs that are stimulated “directly” by the initial change in demand.2 Output multipliers represent the ratio between the total value of output that is simulated economy-wide and the directly simulated output only. An industry with a large multiplier is one, therefore, with strong linkages to other parts of the local economy. In other words, a large output multiplier indicates that a given increase in the demand for industry output stimulates a change in output that is large throughout the entire economy in relation to the change in output in the industry that is directly affected.

2 By definition then, multipliers must be at least 1.


The most common types of multipliers are Type I, II, and SAM multipliers3. Both SAM and Type II multipliers incorporate impact effects that are more inclusive than are reflected in Type I multipliers. Type I multipliers only reflect interindustry economic transactions. Flows of funds to "institutions" - households, government, capital - are assumed to "leak" permanently from the local economy.

IMPLAN Type II multipliers are based on inclusion of the household sector in the model. Thus, these multipliers reflect the fact that as household incomes rise, some portion of this income is reinjected into the local economy as additional or "induced" spending on local goods and services.

Likewise, SAM multipliers typically include the effects of changes in household income and spending. However, SAM multipliers may focus on the income and spending patterns of other "institutional" sectors such as government and owners of capital. Multipliers that include the respending effects of the institutional sectors are logically larger than those that do not. Both SAM and Type II multipliers will be larger than Type I multipliers. SAM multipliers that incorporate all the institutional sectors are often 4 or larger.

IMPLAN Type II multipliers and SAM multipliers that include only the effects of the household sector are mathematically and conceptually very similar. IMPLAN's Type II multipliers typically refer to the SAM accounts to estimate local resident-only disposable income, accounting for the removal of income taxes and allowing for household saving. It is assumed that increased local household incomes are respent according to the spending patterns reflected in the Personal Consumption Expenditures column. IMPLAN's Type SAM multipliers are very similar, but internalize all SAM information about inter-institutional transfers into the model, in this way for accounting for commuting patterns, social security taxes, household income taxes and savings. Type SAM (household sector) multipliers are typically slightly smaller than Type II multipliers.

3. This report utilizes SAM multipliers.


Subsector Source Data FilesMARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY EMPLOYMENT

STATE CENTRAL EASTERN SOUTHERN WESTERN

TIMBER MANAGEMENT AND HARVESTING

22 Forest Products 178 48 27 27 7524 Forestry Products 758 106 473 92 83

133 Logging Camps and Logging Contractors 439 19 249 35 136 SUBTOTAL 1,375 173 749 154 294

PRIMARY WOOD MANUFACTURING

134 Sawmills and Planing Mills, General 1,039 252 387 216 185135 Hardwood Dimension and Flooring Mills 258 37 12 -- 209139 Veneer and Plywood 4 -- 4 -- --145 Wood Preserving 91 18 38 -- 35146 Reconstituted Wood Products 10 10 -- -- --162 Paper Mills, Except Building Paper 1,832 -- -- 24 1,808163 Paperboard Mills 215 75 -- -- --

SUBTOTAL 3,449 392 441 240 2,237

SECONDARY WOOD MANUFACTURING

137 Millwork 1,293 770 13 332 120138 Wood Kitchen Cabinets 179 69 3 26 55140 Structural Wood Members, N.E.C 362 199 4 20 139141 Wood Containers 21 11 2 1 --142 Wood Pallets and Skids 222 80 17 -- 61144 Prefabricated Wood Buildings 315 73 126 7 109147 Wood Products, N.E.C 406 262 3 43 15148 Wood Household Furniture 404 39 55 57 189152 Wood Tv and Radio Cabinets 1 -- -- -- --154 Wood Office Furniture 276 104 2 20 --157 Wood Partitions and Fixtures 296 78 -- 141 --164 Paperboard Containers and Boxes 4,459 2,334 675 527 243165 Paper Coated & Laminated Packaging 20 13 1 4 --166 Paper Coated & Laminated N.E.C. 160 126 -- 34 --168 Bags, Paper 77 77 -- -- --169 Die-cut Paper and Board 48 23 -- 2 --170 Sanitary Paper Products 10 -- 10 -- --171 Envelopes 423 -- 4 110 --172 Stationery Products 42 35 -- -- --173 Converted Paper Products, N.E.C 60 32 -- -- --

SUBTOTAL 9,074 4,325 915 1,324 931 GRAND TOTAL 13,898 4,890 2,229 1,718 3,462

EMPLOYMENT (FTEs)


MARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY OUTPUT



22 Forest Products 17.13 5.07 4.22 2.00 5.8424 Forestry Products 149.43 20.66 96.18 18.22 13.36

133 Logging Camps and Logging Contractors 63.71 2.78 38.41 5.60 16.93 SUBTOTAL 230.27 28.51 138.81 25.82 36.12


134 Sawmills and Planing Mills, General 153.08 37.04 58.95 30.87 26.22135 Hardwood Dimension and Flooring Mills 16.66 2.39 0.75 -- 13.53139 Veneer and Plywood 0.49 -- 0.49 -- --145 Wood Preserving 24.05 4.82 9.82 -- 9.40146 Reconstituted Wood Products 1.92 1.92 -- -- --162 Paper Mills, Except Building Paper 442.09 -- -- 7.68 434.41163 Paperboard Mills 81.65 28.88 -- -- --

SUBTOTAL 719.93 75.04 70.02 38.55 483.56


137 Millwork 115.11 66.05 0.99 32.94 10.08138 Wood Kitchen Cabinets 13.49 5.47 0.16 2.33 3.68140 Structural Wood Members, N.E.C 39.96 22.63 0.39 2.13 14.82141 Wood Containers 1.28 0.71 0.15 0.07 --142 Wood Pallets and Skids 14.99 5.91 1.07 -- 3.91144 Prefabricated Wood Buildings 38.82 11.29 14.48 0.90 12.16147 Wood Products, N.E.C 28.42 18.74 0.22 2.81 1.02148 Wood Household Furniture 33.37 3.32 4.28 4.94 16.24152 Wood Tv and Radio Cabinets 0.10 -- -- -- --154 Wood Office Furniture 21.99 8.90 0.15 1.42 --157 Wood Partitions and Fixtures 22.07 6.08 -- 10.44 --164 Paperboard Containers and Boxes 774.00 402.81 112.04 99.94 41.62165 Paper Coated & Laminated Packaging 4.13 2.73 0.27 0.85 --166 Paper Coated & Laminated N.E.C. 23.74 18.30 -- 5.44 --168 Bags, Paper 11.85 11.85 -- -- --169 Die-cut Paper and Board 5.60 2.70 -- 0.21 --170 Sanitary Paper Products 5.30 -- 5.30 -- --171 Envelopes 59.65 -- 0.61 16.90 --172 Stationery Products 9.32 7.85 -- -- --173 Converted Paper Products, N.E.C 10.74 6.16 -- -- --

SUBTOTAL 1,233.92 601.49 140.11 181.32 103.52GRAND TOTAL 2,184.12 705.04 348.93 245.68 623.20

OUTPUT (millions)


MARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY VALUE ADDED



22 Forest Products 8.61 2.36 0.87 1.72 3.6624 Forestry Products 73.40 10.14 47.34 8.95 6.47

133 Logging Camps and Logging Contractors 23.94 1.03 15.32 2.33 5.25 SUBTOTAL 105.95 13.53 63.54 13.00 15.38


134 Sawmills and Planing Mills, General 41.66 10.06 17.29 7.83 6.47135 Hardwood Dimension and Flooring Mills 8.19 1.17 0.36 -- 6.66139 Veneer and Plywood 0.19 -- 0.19 -- --145 Wood Preserving 4.55 0.98 1.75 -- 1.83146 Reconstituted Wood Products 0.69 0.69 -- -- --162 Paper Mills, Except Building Paper 172.07 -- -- 3.87 168.20163 Paperboard Mills 21.40 7.80 -- -- --

SUBTOTAL 248.76 20.71 19.59 11.70 183.16


137 Millwork 47.48 26.01 0.35 15.26 3.88138 Wood Kitchen Cabinets 7.19 2.99 0.07 1.34 1.83140 Structural Wood Members, N.E.C 15.04 8.86 0.12 0.77 5.29141 Wood Containers 0.52 0.30 0.07 0.02 --142 Wood Pallets and Skids 6.82 2.90 0.47 -- 1.68144 Prefabricated Wood Buildings 14.31 5.34 4.80 0.32 3.84147 Wood Products, N.E.C 13.25 8.90 0.11 1.22 0.45148 Wood Household Furniture 13.69 1.40 1.63 2.14 6.96152 Wood Tv and Radio Cabinets 0.03 -- -- -- --154 Wood Office Furniture 11.51 4.91 0.08 0.68 --157 Wood Partitions and Fixtures 11.98 3.40 -- 5.66 --164 Paperboard Containers and Boxes 217.69 111.73 28.09 33.66 11.38165 Paper Coated & Laminated Packaging 1.45 1.00 0.07 0.29 --166 Paper Coated & Laminated N.E.C. 7.10 5.26 -- 1.84 --168 Bags, Paper 3.62 3.62 -- -- --169 Die-cut Paper and Board 1.87 0.93 -- 0.08 --170 Sanitary Paper Products 1.81 -- 1.81 -- --171 Envelopes 21.35 -- 0.21 6.84 --172 Stationery Products 3.52 2.98 -- -- --173 Converted Paper Products, N.E.C 4.29 2.61 -- -- --

SUBTOTAL 404.53 193.14 37.87 70.12 35.31GRAND TOTAL 759.23 227.37 121.00 94.83 233.85

VALUE ADDED (millions)


MARYLAND FORESTRY AND WOOD PRODUCTS INDUSTRY EMPLOYMENT MULTIPLIER (SAM)



22 Forest Products 2.39 2.01 2.81 1.93 2.02 24 Forestry Products 4.00 2.93 3.73 3.27 3.13

133 Logging Camps and Logging Contractors 2.46 1.89 2.39 2.38 1.99


134 Sawmills and Planing Mills, General 3.09 2.20 3.16 2.60 2.64 135 Hardwood Dimension and Flooring Mills 2.02 1.66 1.98 -- 1.91 139 Veneer and Plywood 2.69 -- 2.51 -- --145 Wood Preserving 4.52 3.20 4.85 -- 4.11 146 Reconstituted Wood Products 3.62 2.70 --162 Paper Mills, Except Building Paper 4.57 -- 5.08 4.04 163 Paperboard Mills 6.30 4.45 -- --


137 Millwork 2.33 1.86 2.18 2.27 2.14 138 Wood Kitchen Cabinets 2.16 1.82 1.79 2.16 1.93 140 Structural Wood Members, N.E.C 2.57 2.07 2.45 2.26 2.38 141 Wood Containers 1.88 1.62 1.94 1.53 --142 Wood Pallets and Skids 2.08 1.79 2.04 -- 1.92 144 Prefabricated Wood Buildings 2.63 2.49 2.47 2.34 2.32 147 Wood Products, N.E.C 2.07 1.74 2.23 1.80 1.91 148 Wood Household Furniture 2.23 1.88 2.05 2.08 2.19 152 Wood Tv and Radio Cabinets 2.27 -- -- --154 Wood Office Furniture 2.32 2.02 2.14 1.92 --157 Wood Partitions and Fixtures 2.16 1.86 1.97 --164 Paperboard Containers and Boxes 2.89 2.35 2.44 2.83 2.68 165 Paper Coated & Laminated Packaging 3.53 2.85 2.68 2.97 2.18 166 Paper Coated & Laminated N.E.C. 2.76 2.23 2.55 --168 Bags, Paper 2.90 2.37 -- --169 Die-cut Paper and Board 2.38 2.01 2.34 --170 Sanitary Paper Products 7.03 -- 6.11 -- --171 Envelopes 2.82 -- 2.45 2.72 --172 Stationery Products 3.61 2.80 -- --173 Converted Paper Products, N.E.C 3.34 2.73 -- --

MEANS: Timber Management and Harvesting Sectors 2.95 2.28 2.98 2.52 2.38 Primary Wood Manufacturing Sectors 3.83 2.84 3.12 3.84 3.17 Secondary Wood Manufacturing Sectors 2.80 2.15 2.54 2.27 2.18 ALL Forestry and Wood Manufacturing Sectors 3.05 2.61 2.72 2.47 2.47 All Industries in Maryland/Region 3.24 2.56 2.51 2.51 2.69

Multiplier** Type SAM


Source Data for Forestry Output Multipliers

Timber Management and Harvesting Sectors

All Industries

Difference From All

IndustriesState 1.93 2.11 -0.18Central 1.61 1.82 -0.21Eastern 1.72 1.89 -0.17Southern 1.70 1.91 -0.21Western 1.71 1.93 -0.22



Primary Wood Manufacturing Sectors

All Industries

Difference From All

IndustriesState 2.15 2.11 +0.04Central 1.74 1.82 -0.09Eastern 2.14 1.89 +0.25Southern 1.92 1.91 +0.01Western 1.91 1.93 -0.02




Secondary Wood Manufacturing Sectors

All Industries

Difference From All

IndustriesState 2.04 2.11 -0.07Central 1.76 1.82 -0.06Eastern 1.97 1.89 0.08Southern 1.84 1.91 -0.07Western 1.90 1.93 -0.03



ALL Forestry and Wood Manufacturing Sectors

All Industries

Difference From All

IndustriesState 2.05 2.11 -0.06Central 1.74 1.82 -0.08Eastern 1.96 1.89 +0.07Southern 1.82 1.91 -0.09Western 1.86 1.93 -0.07




Source Data for Forestry Value-Added Multipliers

Primary Wood Manufacturing Sectors All Industries

Difference From All Industries

State 3.24 2.84 +0.41Central 2.51 1.44 +1.07Eastern 3.08 2.39 +0.68Southern 2.72 2.40 +0.32Western 2.73 2.43 +0.30



Timber Management and Harvesting Sectors All Industries


State 2.30 2.84 -0.54Central 1.90 1.44 +0.45Eastern 2.40 2.39 +0.01Southern 1.87 2.40 -0.53Western 1.93 2.43 -0.49




Secondary Wood Manufacturing Sectors All Industries


State 2.67 2.84 -0.16Central 2.17 1.44 0.72Eastern 2.42 2.39 0.03Southern 2.38 2.40 -0.02Western 2.36 2.43 -0.07



ALL Forestry and Wood Manufacturing

Sectors All Industries

Difference From All

IndustriesState 2.77 2.84 -0.07Central 2.20 1.44 +0.76Eastern 2.55 2.39 +0.16Southern 2.33 2.40 -0.06Western 2.37 2.43 -0.06




SHOCK ANALYSIS: OUTPUTChange in the value of total state industrial output as a result of 10% and 20% shifts in value of output in the Primary Wood Maufacturing Industry.

State of Maryland Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 71,993,000 31,773,755 52,573,268 156,340,021Primary Wood Manufacturing (20%) 143,986,000 63,547,510 105,146,536 312,680,042

Central Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 7,504,400 2,456,020 2,878,294 12,838,713 Primary Wood Manufacturing (20%) 15,008,800 4,912,040 5,756,588 25,677,426

Eastern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 7,001,700 4,426,708 3,899,778 15,328,185 Primary Wood Manufacturing (20%) 14,003,400 8,853,416 7,799,556 30,656,370

Southern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 3,854,500 1,550,197 1,977,609 7,382,306Primary Wood Manufacturing (20%) 7,709,000 3,100,394 3,955,218 14,764,612

Western Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 48,355,700 16,143,793 26,996,460 91,495,953 Primary Wood Manufacturing (20%) 96,711,400 32,287,586 53,992,920 182,991,906


Source: IMPLAN Pro; copyright Minnesota IMPLAN Group.


SHOCK ANALYSIS: EMPLOYMENTChange in the number of jobs as a result of 10% and 20% shifts in value of outputin the Primary Wood Manufacturing Industry.

State of Maryland Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 345 285 762 1,392 Primary Wood Manufacturing (20%) 690 570 1,524 2,784

Central Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 39 24 41 103 Primary Wood Manufacturing (20%) 78 47 81 207

Eastern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 44 38 61 143 Primary Wood Manufacturing (20%) 88 75 122 287

Southern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 24 14 30 68 Primary Wood Manufacturing (20%) 48 28 60 136

Western Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) 224 171 439 833 Primary Wood Manufacturing (20%) 448 341 878 1,666


SOURCE: IMPLAN Pro, copyright Minnesota IMPLAN Group.


SHOCK ANALYSIS: VALUE-ADDEDChange in value-added as a result of 10% and 20% shifts in value-added in the primary wood maufacturing industry.

State of Maryland Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) $24,875,557.00 $16,652,263.00 $35,205,662.00 $76,733,482.00Primary Wood Manufacturing (20%) $49,751,114.00 $33,304,526.00 $70,411,324.00 $153,466,964.00

Central Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) $2,070,460.00 $1,311,187.00 $1,948,857.00 $5,330,504.00Primary Wood Manufacturing (20%) $4,140,920.00 $2,622,374.00 $3,897,714.00 $10,661,008.00

Eastern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) $1,958,776.00 $1,971,721.00 $2,332,623.00 $6,263,120.00Primary Wood Manufacturing (20%) $3,917,552.00 $3,943,442.00 $4,665,246.00 $12,526,240.00

Southern Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) $1,170,344.00 $790,274.00 $1,410,761.00 $3,371,379.00Primary Wood Manufacturing (20%) $2,340,688.00 $1,580,548.00 $2,821,522.00 $6,742,758.00

Western Region Direct* Indirect* Induced* Total*Primary Wood Manufacturing (10%) $18,315,704.00 $8,332,276.00 $16,997,494.00 $43,645,473.00Primary Wood Manufacturing (20%) $36,631,408.00 $16,664,552.00 $33,994,988.00 $87,290,946.00

Data is for 1996; data excludes city of Baltimore.SOURCE: IMPLAN Pro. Copyright Minnesota IMPLAN Group.


About the Authors

Agricultural & Community Development Services (ACDS) is a specialized consulting firm providing agricultural marketing and economic development consulting services to private, public, and not-for-profit clients nation-wide. ACDS utilizes a network of specialists within agriculture, economics, rural development, management, public policy, banking, business development, and related disciplines to provide an uncompromised level of service. This blend of professional talent and extensive experience allows ACDS to research, develop, administer, and manage agricultural and rural development projects.

Duncan Hilchey and David Kay are the primary authors of this report. Mr. Hilchey and Mr. Kay are faculty members at Cornell University and are nationally respected authorities on rural and farm economies. Mr. Hilchey and Mr. Kay have extensive work experience in designing and conducting regional economic impact studies including Input-Output Modeling using IMPLAN.

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