Victoria’s native forest industry generated a direct $770 million in revenue in 2015-16 and supported more than 2500 jobs, most in regional areas, according to a report from Deloitte Access Economics. The industry’s overall economic impact over 10 years is more than $5 billion. The Deloitte report, ‘The Economic Impact of VicForests on the Victorian Community’, was commissioned by VicForests to assess the economic and social impact of the native forest industry. Source: Philip Hopkins for Timberbiz
It builds on and confirms a previous Deloitte study in 2015 on the industry in the Central Highlands.
In Morwell, in the Latrobe Valley, the native timber industry supplies 1400 jobs, or 19% of total full time jobs in the area, the report says. It also supports 844 secondary processing jobs. Australian Paper, for example, has about 1200 full-time employees.
At Orbost in East Gippsland, the industry contributes 214 jobs or 11% of local employment, and 71 secondary processing jobs.
There are few other jobs available in these towns, the study says. Morwell’s unemployment rate is 18.3% and Orbost’s is 10.9%.
“When this activity is taken away, the impacts on regional towns can be significant,” says the study, citing examples in New South Wales and Western Australia.
The report breaks down the revenue into components: $112 million from VicForests’ native timber sales and the $657.9 million in revenue generated by the customers, such as sawmills, paper mills and firewood retailers. This totals $769.9 million.
The activity of VicForests, its contractors and customers supports 2526 full-time workers, including 506 full time workers directly employed by VicForests and its contractors.
The total “additional value” these enterprises create in Victoria – the ‘flow on’ impacts – amounts to $297.3 million. Specifically, the Victorian economy would be permanently smaller by 0.15% and wages would be 0.14% lower if VicForests did not exist, the report says.
Deloitte says the cumulative added impact of the native forest industry is about $2.23 billion over the 10-year modelling period, or about $233 million a year.
“The economy-wide impact over the modelling period is $5.21 billion, including native forestry and accounting for its interactions and impacts with other industry sectors,” the report says.
The report’s highlights include:
- Despite the importance of regional jobs, most employment in secondary processing tales place in Greater Melbourne.
- Without native timber harvesting, net carbon emissions are estimated to be higher, as harvesting is less carbon intensive compared to substitutes from overseas.
- The carbon footprint from alternative materials such as concrete is substantially higher than native timber.
- Without native timber harvesting, fire fighting would be badly affected by the loss of fire-fighting resources – skilled staff, specialised forest equipment and reduced road maintenance.
- Tourism may benefit, but these benefits are uncertain and would need huge investment to occur.
- The report can be found at www.vicforests.com.au
