Hardwood logging in Appalachia is 'hanging on by a thread.' China, tariffs and U.S. economics all play a part.

Since American colonial times, Appalachians have logged the region's vast forests and run sawmills to prepare cut wood for use, but the industry has been hampered by multiple economic setbacks and faces an uncertain future, reports Paul Kiernan of The Wall Street Journal. "The industry has been in decline for decades. A series of shocks since 2018 has accelerated the decline: a trade war with China, a collapse in exports due to Covid, China’s real-estate slump, and falling U.S. home building." The downturn has had a domino effect on loggers, sawmill workers, truckers and manufacturers.

Once a robust economic sector in Appalachia, logging businesses have closed due to poor market demand and high operational costs. "Roughly two dozen sawmills in the region have gone out of business in the past year or so. . . .The Eastern U.S.’s hardwood production has fallen to its lowest level in records going back to 1960," Kiernan explains. "Workers’ compensation insurance is too expensive for many sawmills to directly employ loggers."

Where two decades ago harvesting hardwood trees was profitable, trade, particularly with China, has decimated U.S. logging businesses and jobs. "Appalachian hardwoods supported thriving manufacturing facilities in nearby towns and cities," Kiernan writes. "North Carolina’s furniture plants, for instance, employed nearly 80,000 workers in 1999, shortly before China’s accession to the World Trade Organization opened the U.S. to Chinese imports. Within 10 years, that number had fallen to 35,000, with most of the jobs shipped overseas."

While some political agendas support protective tariffs, that may not be an easy solution. "Trump says tariffs will bring back manufacturing jobs. Yet the North Carolina furniture business currently employs under 30,000 workers, 20% fewer than when Trump imposed tariffs on China, including on furniture," Kiernan explains. "A worrisome trend for sawmills in recent years is that China has been reducing its imports of finished lumber from the U.S."

Appalachia already has economic worries and the shrinking hardwood industry has added to them. Kiernan adds, "Closing sawmills will accelerate the decline of communities already faced with aging populations and outward migration."