The Three Pillars of Sustainability

Economic

The economic health of the U.S. paper and wood products manufacturing industry is vital to its sustainable future. AF&PA advocates for government policies and regulations that allow the industry to remain competitive in order to manufacture products that people use and need. AF&PA believes that market forces should be the primary drivers of sustainability initiatives.

Average wage for a U.S. paper industry employee in 2016

Forest products industry contributions to total U.S. manufacturing Gross Domestic Product (GDP) in 2016

U.S. pulp and paper mills located in rural areas

Contributions to GDP

In 2016, the forest products industry contributed $89 billion to the total U.S. manufacturing Gross Domestic Product (GDP), of which the pulp and paper sector accounted for $59 billion and the wood products sector provided $30 billion. This translates to four percent of the U.S. manufacturing GDP.

Employment

The forest products industry is among the top ten manufacturing sector employers in 45 U.S. states.

In 2017, the industry directly employed 934,000 men and women: 98,500 people were employed at pulp, paper and paperboard mills; 270,100 at paper and paperboard converting plants; 397,000 at lumber and wood panel facilities; and 119,100 at wood kitchen cabinet plants.

In 2016, employee compensation paid was $29.9 billion in the paper industry, $21.0 billion in the wood products industry and $2.3 billion in the logging industry, totaling $53.2 billion.

Paper industry employee earnings averaged $66,900 in 2016, which was 24 percent above the national average earnings of all non-farm private sector employees. In the Southeast, the leading U.S. region for paper production, paper industry employees earned 49 percent more than their private sector counterparts.

Aligns with objectives of UNSDG #8: Decent Work and Economic Growth

Impact on Local Communities

AF&PA member facilities are often located in rural communities where they frequently serve as the largest employer. As a result, local economies can be highly dependent on the economic viability of these facilities.

More than 75 percent of all U.S. pulp and paper mills are located in counties that are more than 80 percent rural.

In addition to employee compensation and $12.4 billion spent on capital expenditures, the forest products industry spent $138 billion on materials and parts, $5.1 billion on purchased electricity and $3.7 billion on purchased fuels in 2016. Many of these expenditures occurred in and benefited local communities.

Aligns with objectives of UNSDG #11: Sustainable Cities and Communities

Member Spotlight

Sappi North America Recognized for Economic and Community Contributions in Cloquet, Minnesota

The state of Minnesota’s Department of Employment and Economic Development honored Sappi for its contributions in Cloquet, where the company employs nearly 700 men and women. Sappi invested $170 million to expand the 120-year-old mill’s kraft pulp operations, adding the ability to produce chemical cellulose. The diversification helps the plant remain viable in a highly competitive international market.

Capital Spending

To help modernize plants and in some cases add to capacity, the forest products industry spent $12.4 billion on capital expenditures in 2016, up from $11.9 billion in 2015. The low point occurred during the Great Recession when the industry’s capital spending fell to $6.2 billion in 2009. The breakdown of 2016 capital spending was paper industry ($7.7 billion) and wood products ($4.8 billion).

Profits

Forest products industry operating profits totaled about $16.4 billion in 2017, which equaled the 2016 level. Industry operating profits for the ten-year period ending in 2017 averaged $13 billion a year. The paper segment of the industry earned $8.8 billion in 2017, while the wood side netted operating profits of $7.5 billion.

Research & Development (R&D) Expenditures

The forest products industry continues to devote significant resources to the development of new and improved products. Forest products companies with U.S. operations spent over a billion dollars on R&D in 2015: spending by the paper industry totaled $864 million, while the wood products sector spent $190 million. More than 90 percent of those expenditures took place in the U.S. During the 2012-2014 period, 18.1 percent of paper companies introduced new goods or services, compared with 9.4 percent of all U.S. companies.

economic-pillar-us-map

Our industry provides jobs and products that contribute to a healthy economy.