Forestry Forecast: Experts Discuss Changing Industry

The forestry industry is currently experiencing change on a number of fronts. Tight labour markets, evolving environmental expectations, and new market opportunities are forcing companies to assess and adapt on an ongoing basis. We consulted a panel of industry experts in order to get their observations and advice in three general areas: hiring, company management, and innovation. 

Jerry Doman CEO & President of Centurion Lumber.
Julie WongDirector of Human Resources at CanWel Building Materials Ltd.
Mark Gloutney Director of Regional Operations – Eastern Canada and BC at Ducks Unlimited Canada.
Orlando Rojas Professor and Canada Excellence Research Chair, UBC Departments of Chemical & Biological Engineering | Chemistry | Wood Science.


Section One- Hiring: Big Demand but Thin Supply 

Labour Shortage

Labour shortages are being felt across industries; forestry is no exception. 

“In our mill operations and on the administration side we need more employees and it’s hard to recruit them. A lot of people are staying where they are or just collecting these government programs and saying ‘I’m happy to stay home right now,’ so that’s frustrating. People aren’t gravitating toward the forestry industry with all the downsizing it’s had over the last 20 years or so. The resumes are thin and it’s been hard finding the right fit” -Jerry Doman

Hesitancy to Switch Positions

Canwel ‘s Julie Wong and Ducks Unlimited Canada’s Mark Gloutney sense an aversion to risk on the part of potential candidates. 

“For the passive job seeker, those that are currently employed, it’s very difficult for them to quit a job and go to a new one, because there’s so much uncertainty.” -Julie Wong 

“It’s been surprisingly challenging. We’ve been struggling to get people to even apply. We’ve had a couple of examples where we’ve made offers to folks and they’ve essentially just reconsidered and said, ‘under these conditions, I’m just not willing to take the risk to make a change’. Having said that, we recruited 16 summer students in British Columbia in the last month or so and I think that’s more students than we’ve ever had in BC.” -Mark Gloutney

Recruiting Strong Candidates 

Although CanWel is experiencing a need for employees from coast to coast and from office to warehouse, Wong explains that candidate quality is more important than quantity. 

“We’ve had a lot of applicants, but it’s the qualified candidates that we’re looking for. We use what we call our core CanWel expectations as benchmarks for hiring new employees. We’re talking about professionalism, behaviour, mentality, and emotional outlook. Maybe that’s why it’s hard for us to find employees, because we’re looking for the cream of the crop.” 

Compensation Calculations

“We review our compensation program on an annual basis and even more frequently when market conditions change. I always look at four categories. External equity considers what other companies are paying while internal equity seeks to maintain fairness and hierarchy within the company. The company’s ability to pay, as well as the skill and performance of the person in question are also important considerations.

We do have to remain fiscally responsible with compensation. This means that we cannot pay outrageous salaries when the economy is really good, because what happens when the economy is poor? We can’t reduce wages.” -JW 

One of CanWel’s secret weapons is a robust referral program which was recently boosted to $1700 for employees who recruit a successful applicant. 

“What’s the best referral for a company? It’s your own employees. We’d be happy to pay this money over and over again if it can help us find employees.” -JW 

Remote and Hybrid Work

Like businesses in other industries, forestry companies are considering the future of their work models. Wong describes CanWel’s challenges with remote work technology, while Gloutney sees challenges with employee onboarding. 

“We have a small call centre in each one of our locations. It’s difficult at this point to do those jobs remotely, because of internet availability and the speed of Wi-Fi, so we haven’t yet made the decision as to what to do moving forward.” -JW

“I think the reality of leaving where you are and going into a new environment where everybody’s working from home makes it a challenge to integrate into the company. How do you integrate with your colleagues when you’re working in an at home environment? That’s causing hesitancy as well with people that are thinking about moving.” -MG 

Section Two- Management: Loyalty, Partnerships, and Leveraging Reputation 

Management concerns for those on our panel include retention, loyalty, succession planning, and partnership management. 

Leveraging Company Reputation for Recruitment and Retention

“What we rely upon is our reputation. One of the key things you look for when considering a move is whether or not the company is going to be around in a year? Why do I want to risk leaving my current job, where I’m stable, to go somewhere else? Candidates check out our website and see all the different things we do. We’re not a fly by night operation. We’ve been around for more than 30 years. We’re solid and growing.” -JW

CanWel provides employees with generous perks, including parking and bus subsidies, as well as tuition reimbursement and scholarships for employees and their families. In addition, the company was named one of BC’s Top Employers for 2020. Wong describes that application process as rewarding and informative. 

“The process really gave us a chance to review what we currently offered our employees and also to change or enhance what we were doing. It was a wonderful acknowledgement that we were doing a great job in taking care of our employees.” -JW

Lack of Employee Loyalty

Jerry Doman has seen an erosion of employee loyalty, as well as a shift in overall attitudes toward employment in general. 

“In 43 years, I don’t remember this level of turnover.  We invest a lot of time in training people; our pay scales seem to be fair and we’re not hard on staff, yet people decide they want to go do something else. If you talk to people in Vancouver and Victoria, they’re all facing the same thing. They say that a lot of the CPA grads are leaving as soon as they get their ticket. When I was growing up, your job was one of your main ‘things’ but now people are looking for short work-weeks or to work from home. People tend to move around every 3-5 years, they’re not looking to spend a career at one business any more.’-JD

Succession Planning

Doman’s three adult children are fully integrated into the company, making succession planning top of mind for the veteran CEO. As a third generation family-run operation, it’s an aspect of business that Doman considers essential. 

“They’re all unique in their personalities and their abilities. My sons can be working in their office one day but, if we’re short staffed, they’re driving forklifts, unloading loading tills, doing whatever needs to be done. My daughter works on the admin side, but she knows how to get her hands dirty too.” -JD 

Keeping the Team in Tact

While the pandemic forced Ducks Unlimited Canada to make adjustments with their fundraising and education groups, they were able to keep the core of their conservation team intact.

“We were able to sustain the core of our conservation group, which is the core of our main business. As a result of that, we were able to deliver all the work that we said we’d do, and to fully fulfill our grant requirements and grant obligations, so that it was a pretty good year that way.” -MG

Leveraging Partnerships 

Gloutney observes an increased emphasis being placed on partnerships in the conservation community, a trend he finds favourable. 

“Nobody works alone anymore, everything is done in partnerships. I think that’s one of the things that Canada can be pretty proud of; there’s a really strong commitment to partnerships between government, industry, and ENGOs. I think that’s a good thing. We all end up having more cumulative impact on the environment when those kinds of things happen.” -MG

Section Three- Innovation: Expanding Mindset and Opportunity

Adding Value and Attracting Investments

Orlando Rojas sees the opportunity to add value through innovation and expansion. As companies look to the future with an eye on long term profitability, this is welcome news, provided they’re willing to pivot. 

“Compared to other countries in the boreal belt, the forestry sectort here in Canada is very much reliant on the primary production segment,including lumber, pulp and paper. My mission here is to bring this up to the next level, to add value to those forest-based products.” -Orlando Rojas 

A Sustainable Alternative to Plastic

Much has been made about the non-biodegradable nature of polymer plastics. Rojas sees this as an opportunity. 

“The solution is fiber based. These fibers may come from wood, but could also be from any plant, be it woody or, – non-woody as well as residual,-, biomass” -OR 

Single use plastics which would include face masks in the present times, represent another opportunity, according to Rojas. 

“We use petroleum-derived polymers for making face masks but there are issues with their disposal and persistence in the environment and even with the feel on our skin. In Canada, there are several developments in this area, for instance, considering wood fibers for air filtration. Such materials would look like just a piece of paper, but there’s much more to it. The performance should be such that the material is breathable but efficient to stop small particles, such as droplets that carry the virus.” -OR 

Fiber-based food packaging materials are generating interest as well. 

“They are designed to have given properties, according to their use, which include water and grease repellency, antimicrobial activity, and strength. They should fold properly and present good barrier performance (air and water vapor). out. Nowadays we talk about active and intelligent packaging, with additional sets of properties. It’s a highly technological industry that involves cross-cutting fields, such as those associated with chemical and mechanical engineers, material scientists, biologists and designers.” -OR

Incentivizing Innovation

Rojas, who also cites wood fibers as source for next generation textiles, where there are already ongoing investments or repurposing bark and forest residues in promising areas, believes that market forces alone will not be sufficient to prompt large-scale innovation.

“There are many barriers that would probably need to be addressed through government incentives. Pivoting is not easy and requires economies of scale to be successful. When we think about forest, pulp, and paper, we’re talking about an established industry that would need to have a very good justification to invest in new capital and new operations to create new bioproducts. Typical plastic bags and similar materials, for instance, are produced by using thermal processing. Hence, different routes need to be in place to replace the typical petrochemical streams with fiber-based alternatives. This means new installations, which add to capital costs. I think we need to think not in terms of replacing plastics, but rather to propose new bioproducts that take advantage of the inherent properties of plant fibers. In considering green processing and sustainable products, one needs to remove some obstacles, a process that can be accelerated by government interventions, for instance, via incentives, tax measures, codes and regulations, including those related to carbon footprint, and so on. But I’m talking about some sectors, not all.” -OR

Despite this, Rojas believes that private equity is eager to participate. 

“They want to invest in products that are sustainable, green and environmentally-friendly, compostable or recyclable.” -OR

Promoting Sustainability in Forestry

Innovation for Ducks Unlimited Canada involves collaboration. 

“There’s lots of examples where Ducks has been working extensively with the forest sector to try to find solutions to some of their operational realities. 

We’ve collaborated to develop best management practices for building roads through wetlands which allowed for hydrological connection between the two sides of the road. These types of practices allow harvests to happen in a more sustainable fashion in order to mitigate or alleviate environmental impact.” -MG

Training is another important piece that DU brings to the table. 

“We launched some boreal wetland 101 courses in order to help forest managers build a better understanding of some of the natural features that exist within their land holdings and identify some of the things they need to think about as they’re operating around and near these features. Those kinds of things are helpful, I hope.” -MG 

In working with industry, Gloutney appreciates the need to balance economic and environmental concerns. 

“One of the big challenges is really finding that sweet spot where you can implement actions and solutions that balance economic prosperity and environmental sustainability. How do you find that sweet spot?

We strive to find solutions that allow foresters to operate in such a way that it supports our environment and provides for clean water, provides for clean air, provides habitat for all the animals that use those landscapes, and improves situations for species at risk.” -MG

Looking to the Future

Innovation, of course, is an ongoing process. Rojas sees a need to look beyond day to day operations in search of answers that will work for the future. 

“In general, they need to be looking into options, not for today, not to keep the status quo and operations as usual, but rather to create new opportunities, becoming disruptive and competitive today and tomorrow, with attention to the long term horizon. This is a huge opportunity for many segments of the industry, especially those that operate in the bioeconomy space, including the forest products sector. There is a huge demand for creating new bio products, which requires a different mindset as far as our relation with the planet and our role in ensuring a sustainable future” -OR 

Cited Sources
Personal communication with Jerry Doman, Julie Wong, Mark Gloutney, and Orlando Rojas