Recession, restructuring and routine: The case of BC's forest industries 1980-2008

For several decades, BC’s forest industries have been in crisis, experiencing a sequence of booms and busts. Beginning with the 1980s recession, which is widely recognized as a paradigmatic turning point, the industry has undergone extensive restructuring. Simultaneously, harvest levels started to decline, marking entry onto the so-called plateau stage of the resource cycle. This thesis examines the industrial restructuring of BC’s forest industries since 1980. Conceptually, the theoretical framework integrates the industry life-cycle model with the resource cycle thesis to create the RILCM (resource industry life-cycle model). The RILCM recognizes the distinctive trajectories of resource industries as a result of their direct exploitation of nature, vulnerability to economic and non-economic influences, and booming and busting. This thesis argues that the high volatility of BC’s forest economy is not simply demand-driven but results from the combined influences of paradigmatic industrial change, declines in resource availability and increased trade, environmental and cultural conflicts that have initiated a significant re-regulation of BC’s forest economy. Empirically, this thesis applies both qualitative and quantitative research methods; those include time-series analysis, comparative static analysis based on information retrieved from industrial directories, a corporate case study of Canfor, BC’s largest forest firm, and a field survey of surviving sawmills. In evolutionary perspective, BC’s forest industries enjoyed stable growth from 1946 to 1970. Growth rates became more volatile during the 1970s and have leveled off or declined from 1980. In terms of industrial organization, rationalization and consolidation resulted in aggregate job loss, factory closures and the breaking up of the large previously dominant Fordist corporations. Restructuring has led to the evolution of a dual industry structure and re-defined core-periphery relations. Thus commodity production in large sawmills and pulp mills continues in the periphery, a dynamic value-added segment has emerged in Metro Vancouver and other urban cores. More generally this thesis argues the need for understanding how regions and industries respond to prolonged periods of crisis and volatility. Evolutionary approaches to economic geography need to incorporate resource peripheries and crisis and acknowledge the role of non-economic factors in shaping regional transformation.