Changes in Tennessee's Secondary Hardwood Processing and Sawmill Industries from 2005 to 2009

Abstract

Tennessee is in the center of the Eastern hardwood region and has experienced large declines in employment by primary and secondary hardwood processors since 2005 in a pattern similar to the one these processors have experienced nationally. The objective of this article is to examine changes in national hardwood processing industries between 2005 and 2009 and compare these changes with changes in secondary manufacturing employment and hardwood lumber production in Tennessee. The decline in employment in Tennessee's furniture industry was caused by increased imports of wooden furniture from Asia and reduced domestic furniture demand as the result of the 2009 recession. Reduced employment in Tennessee's flooring and kitchen cabinet industry was a function of the decline in home construction, large firms shifting production to other states, and the 2009 recession. Employment in the millwork industry was less affected perhaps because of shifts in production by larger firms from northern and western states to Tennessee. Declines in hardwood lumber consumption caused most large and very large sawmills in Tennessee to downsize and several medium and small mills to go out of business. The short-term outlook for Tennessee's secondary and primary hardwood manufacturers continues to be bleak except for pallets, crossties, and exports.