From lumber to furniture production, Michigan’s forest products are a $26.5 billion industry, according to a report

The production of lumber, wood furniture, paper and other products from more than 20 million acres of forests that cover about half of Michigan represents a growing share of the state’s economy.

The forest products industry contributed more than $26.5 billion directly and indirectly to the economy in 2022, reaching a “new high” of $4 billion above 2019 levels, according to a Michigan Department of Natural Resources report released Friday, July 12.

The total includes direct production of $16.2 billion – the highest amount since the state began reporting in 2015.

Added to that amount are indirect impacts from industries tied to the forest products sector, such as workers spending money at restaurants, grocery stores or on recreational activities, says DNR forestry economist Jagdish Poudel, who authored the report.

The data lags one to two years behind because developing the economic models on which the study is based takes time, he said.

“Michigan’s forests are a sustainable source of building materials, furniture, and paper and paperboard products,” said Jeff Stampfly, chief of the DNR’s Forest Resources Division and state forester, in a statement. “We are always looking for ways to best support industry and respond to the public’s increasing need for sustainability.”

Read more: More UP forests offer carbon credits that offset ecosystems and timber sales

While economic indicators such as average wages, industry productivity and production have all increased by more than 10% compared to pre-COVID figures, the total number of people employed in the industry has fallen by 3.6% compared to 2019, the report said.

In 2022, nearly 40,500 people worked in forestry, wood processing, paper production and other industries that depend on Michigan’s forests, according to the report, with the furniture industry accounting for the largest share.

The average wage in the industry is almost $80,000 and for every direct job in the forestry sector, 1.1 additional jobs are created, according to the figures.

The increase in overall economic output was due to a “strong” forestry industry and its links to other parts of the economy, officials said.

Arauco, the world’s largest particleboard manufacturer, also opened a $450 million manufacturing facility in Grayling in 2019, directly creating about 220 jobs, according to the DNR.

Pulp, paper, board and other paper products represented the industry’s largest direct economic output in 2022, valued at $7.7 billion, the report said. This was followed by primary and secondary solid wood products at $5.6 billion, then wood furniture at $2.4 billion and logging at $470 million.

According to the DNR, the industry also supports about 120 jobs in woody biomass power generation, where materials such as residues from mills, manufacturers and timber harvesting are converted into renewable energy.

The state has also partnered with Michigan State University and Michigan Technological University to promote mass timber, a type of composite wood that can replace concrete and steel as a building material while having a lower impact on the climate.

Read more: A mass timber mill could boost Michigan’s economy using the Great Lakes forests

The government is already using the technology.

According to officials, a new DNR customer service center is currently being built in the eastern Upper Peninsula using solid Michigan red pine materials.