The U.S. forest products industry makes a strong contribution to the national economy, producing 2.7% of the U.S. GDP in 1999. The industry employed 1.1 million people in 2001, with average hourly production wages of $17.68 in the pulp and paper sector and $12.30 in lumber and wood products [DOC 2001]. The industries are highly cyclical, being dependent on commodity prices and strong consumer markets. Following a prolonged downcycle in the economic recession of the early 1990s, a time of significant downsizing and industry restructuring, the paper industry posted strong production gains in the robust economy of the mid 1990s. In 1999, total paper and board production was showing flat-to-fractional growth and wood pulp production was below 1998 by 2.5% [Miller Freeman 1999]. To stay competitive and to develop the products and processes that will be required to comply with environmental regulations, the pulp and paper sector directs about 1% of its sales annually toward R&D on new/improved products and processes. R&D spending for the pulp and paper sector alone was close to $1.6 billion in 1998 [AF&PA 2002].

Source: DOC 2001, DOC 1994, ITA 2001, NSF 1997