Case study | 20 February 2025

WWF-Australia | Forestry transition and regional employment

View our case study on how we helped WWF-Australia to analyse the forestry transition and regional employment.

What was the challenge?

The New South Wales (NSW) native forest sector has been contracting over a long period as publicly provided wood supply has fallen to more sustainable levels. We have previously estimated that direct employment in public native forest logging in NSW to be in the order of 1,070 across the state.

However, despite the relatively small employment contribution public native forestry makes, the businesses and jobs are highly valued in the regional economies.

Today, the construction industry does not widely use public native forest resources (hardwood) to build houses. Where it is used, hardwood is used for high-end decorative purposes such as flooring and veneers.

In fact, demand for woodchip exports to Asia is what drives sector growth. Since the 2019–20 bushfires, approximately 80 per cent of the growth in FCNSW’s harvested volume has been in pulplogs destined for woodchip exports. Australia’s construction sector relies mostly on imported softwood plantation products.

Against this background, WWF-Australia asked us to analyse:

The spatial economic characteristics of the public native forest logging sector in regional NSW, and
A credible evidence base and economic assessment to support the forestry sector transition out of public native forest logging.

▼1,070

declining employment in public native forestry

▲1,200

jobs could be supported through structural adjustment

2 million

hectares of state forest protected

How did we complete the economic modelling and analysis?

To start, we created a spatial representation of the public native forest logging sector. The analysis contained information on state forest logging zones and Forestry Corporation of NSW’s (FCNSW) public native forest timber customers. We also identified the location and scale of FCNSW’s softwood and hardwood plantations and customers.

We found that the public native forest sector is spread across NSW, with areas of relative concentration in the far south and north coasts of the state. See the figure to the left where the red circles represent the location and volume of demand:

The north coast is characterised by approximately 41 hardwood customers, with 80 per cent being supplied less than 15,000m per annum, likely from a mix of native forest and hardwood plantation sources.
In the far south, demand for native forest hardwood is dominated by the Eden timber processing facility, which primarily processes native forest resource into woodchip for export.

Secondly, we conducted an analysis of market trends in public native forestry, finding that the sector is likely that to continue it’s decline. It faces a range of challenges including a reduction in wood supply, climate risks, the establishment of new conservation estates, competition from softwood products, and a substitution of native hardwood for plantation hardwood in international markets.

We note that as a result of the discovery of significant data errors in FCNSW’s biomaterial reports, made after this work was completed, the level of public native forest harvesting activity is significantly lower than previously disclosed.

Thirdly, we analysed the economies of two regions – the Bega Valley Shire, and Port Macquarie-Hastings:

Bega Valley Shire: The transition out of public native forest logging has to a large extent already occurred. Now almost entirely focused on the chipping of pulplogs for export, with sawmilling activity having largely exited. The regional economy appears to have shown the capacity to adapt to these changes over time.
Port Macquarie-Hastings: Public native forest logging predominately supports sawmilling activity, complemented by hardwood plantations. The region’s economic diversification and historic growth profile suggest it is well placed to adapt to change.

In both regions, forestry-related jobs make up a small share of employment—around 0.5 per cent in Wood Product Manufacturing and 0.2–0.8 per cent in Forestry and Logging. Public native forest logging employment is a subset of this.

What were the results?

Jailene Santana, Forest Futures Specialist, WWF–Australia said:

A plan to support employment in bush economies is a crucial step towards ending the destruction caused by native forest logging. Native forest logging runs at a loss, is a burden on taxpayers, and the jobs associated with it are not secure.

Our analysis, including stakeholder input, identified structural adjustment interventions to enhance supply chain resilience and value-added potential amid a transition out of public native forest logging:

Developing alternative sources of hardwood supply, including through hardwood plantation and agroforestry to support medium to longer term supply and supported by sustainable imported resource in the short term,
Incentivising alternative modes of manufacture, such as in more sophisticated wood processing technologies that can utilise lower-grade timber resources to manufacture structural and appearance grade wood products, and
Conservation and restoration activities required to transition approximately 2 million hectares of forests to protected areas.

We estimated the direct employment potential that could be supported by a successful but conservative version of these structural adjustment interventions. Estimating that around 1,200 positions in NSW could be supported over the medium to longer term.

Our full report contains more information on our analysis and recommendations below.

DOWNLOAD THE REPORT