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The impact of the forest industry on economic development in the central interior of British Columbia Vance, Eric Carter 1981

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IMPACT OF THE FOREST INDUSTRY ON ECONOMIC DEVELOPMENT IN  THE CENTRAL INTERIOR OF BRITISH COLUMBIA by ERIC CARTER VANCE  B.A., The U n i v e r s i t y of B r i t i s h Columbia, 1975 A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE  REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS in  THE  FACULTY OF GRADUATE STUDIES Department of Geography  We accept t h i s  t h e s i s as conforming  to the r e q u i r e d  THE  standard  UNIVERSITY OF BRITISH COLUMBIA A p r i l , 1981 ©  Eric  C a r t e r Vance, 1981  In p r e s e n t i n g  this  thesis  in partial  f u l f i l m e n t of the  r e q u i r e m e n t s f o r an a d v a n c e d d e g r e e a t t h e of B r i t i s h Columbia, I agree that it  freely  the L i b r a r y s h a l l  a v a i l a b l e f o r r e f e r e n c e and s t u d y .  agree that p e r m i s s i o n f o r extensive for  University  s c h o l a r l y p u r p o s e s may  for  financial  shall  of  Geography  The U n i v e r s i t y o f B r i t i s h 2075 W e s b r o o k P l a c e V a n c o u v e r , Canada V6T 1W5 Date  DE-6  (2/79)  April,  1981  Columbia  my  It is thesis  n o t be a l l o w e d w i t h o u t my  permission.  Department  thesis  be g r a n t e d by t h e h e a d o f  copying or p u b l i c a t i o n of this  gain  further  copying of t h i s  d e p a r t m e n t o r by h i s o r h e r r e p r e s e n t a t i v e s . understood that  I  make  written  i ABSTRACT  There are very in  detail  the  subprovincial cited  is  published  economic level  that  appropriate  few  techniques  handling  economic data than are of  this  study  that  examination of the regional  or  conducted  local  with  of  the  forest  i n B r i t i s h Columbia.  the  for  impact  s t u d i e s that have i n v e s t i g a t e d  such  The  analysis  an  undertaking  data  economic impact scale  some  and  do  that  widely  viewed  exist  an  and  often most  require  more  hypothesis  allow  forest  such  utilized  to  a  as  I t i s the  of the  at  reason most  of  e a s i l y obtainable.  sufficient  industry  a  close  industry  analysis  at  can  relatively  a be  simple  techniques of measurement.  The  chosen as  because of i t s heavy dependence upon  the  study r e g i o n  c e n t r a l i n t e r i o r of B.C.  the f o r e s t i n d u s t r y f o r i t s economic The  thesis  development of concentrates  begins  the  with  upon the  economic  had  of  the  historical  i n the c e n t r a l i n t e r i o r .  factors  that  r a t e of growth and  have  affected  It the  the impact that  this  on o v e r a l l r e g i o n a l development.  Analysis i n d u s t r y and two  well-being.  discussion  forest industry  i n d u s t r y ' s d i r e c t i o n and has  a  has been  forms  method  and  forms  of  of  the  Economic  the  Minimum  measurement  particularly  relationship  the r e g i o n a l economy i s i n p a r t  of  theoretical  present  and  Base  Analysis  Requirements are  empirical  research  the  forest  accomplished  the  Location  technique.  reviewed,  i n regards to the  of North America.  -  between  Quotient  Both  highlighting  using  of  the  these major  involving their application,  forest industry  Using S t a t i s t i c s Canada labour  i n other  regions  f o r c e data,  the  a n a l y s i s has concluded that an employment m u l t i p l i e r of 2 . 1 3 i s j u s t i f i a b l e f o r the c e n t r a l i n t e r i o r of B.C. The l a t t e r p o r t i o n of the t h e s i s attempts a dynamic approach to t r a c i n g the l i n k a g e s between the f o r e s t i n d u s t r y and the r e s t of the r e g i o n a l economy.  Applying  types  of data  - employment,  study  reveals  the complexity  within  the  significant exhibits  earnings, of  economic  the  and unemployment interindustrial  system.  Several  of  - the  linkages the more  f i n d i n g s are that the nonbasic s e c t o r of the economy surprising  fluctuations overlooked  regional  s t a t i s t i c a l a n a l y s i s to three  and effect  resilience  that that  the  to  short-term  unemployment  must  be  rate  carefully  employment is  an  considered  determining the a c t u a l r a t e of development w i t h i n a r e g i o n .  often in  iii TABLE OF  CONTENTS Page  ABSTRACT  i  L I S T OF TABLES  iv  L I S T OF FIGURES  v  ACKNOWLEDGEMENTS CHAPTER  vi  1 - INTRODUCTION  1  Footnotes  7  CHAPTER 2 - THE DEVELOPMENT OF THE FOREST INDUSTRY I N CENTRAL B R I T I S H COLUMBIA 2.1 2.2  The E a r l y Y e a r s o f D e v e l o p m e n t : 1 9 0 7 - 1 9 5 3 Rapid Development i n t h e Region: 1 9 5 4 - 1 9 7 5 Footnotes  CHAPTER 3 - ECONOMIC BASE ANALYSIS AND I T S APPLICATION THE CENTRAL INTERIOR REGION 3.1 3.2 3.3 3.4 3.5 3.6  A Review o f Economic Base A n a l y s i s The A s s u m p t i o n s A p p r o a c h The L o c a t i o n Q u o t i e n t M e t h o d The Minimum R e q u i r e m e n t s T e c h n i q u e E m p i r i c a l Economic Base A n a l y s i s I n v o l v i n g the F o r e s t I n d u s t r y The A p p l i c a t i o n o f E c o n o m i c B a s e A n a l y s i s to the Central I n t e r i o r Footnotes  8 ....  TO  8 19  37  39 41 44 45 48 51 57 69  CHAPTER 4 - ANALYSIS OF EMPLOYMENT, EARNINGS, AND UNEMPLOYMENT I N THE CENTRAL INTERIOR, 4.1 4.2 4.3  1973-1976  73  A n a l y s i s o f Employment Analysis of Earnings A n a l y s i s o f Unemployment Footnotes  73 80 87 95  CHAPTER 5 - CONCLUSIONS BIBLIOGRAPHY  96 100  iv L I S T OF  TABLES Page  I  C o a s t and  Interior  Lumber  Production,  1951-1976  22  of C e n t e r s i n Economic Region 7  24  II  Population  III  Number and S i z e o f M i l l s i n t h e C e n t r a l Interior Summary o f M u l t i p l i e r s C a l c u l a t e d by E m p i r i c a l S t u d i e s of the F o r e s t I n d u s t r y  56  Labour Force i n the C e n t r a l I n t e r i o r f o r 1971  58  IV V  by  26  Industry  VI  B a s i c - N o n b a s i c Employment R a t i o s C a l c u l a t e d u s i n g Economic Base A n a l y s i s  60  VII  B a s i o - N o n b a s i c Employment i n t h e C e n t r a l I n t e r i o r as C a l c u l a t e d by t h e Minimum Requirements Technique  63  VIII  Mean Employment by  Industry  and  Region,  1975-76  75  IX  F l u c t u a t i o n i n Employment, 1 9 7 5 - 7 6  77  X  Mean W e e k l y E a r n i n g s by  Industry  and  Region,  1973-76  81  XI  F l u c t u a t i o n i n Mean W e e k l y E a r n i n g s ,  XII  Unemployment i n t h e  Central  Interior,  1973-76 1973-76  85 88  LIST OF FIGURES Page 1  Location  2  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s I n t e r i o r o f B.C. - 1926  3  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s i n the C e n t r a l I n t e r i o r of B.C. - 1936  15  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s I n t e r i o r of B.C. - 1948  17  4  4  of Study Region i n the C e n t r a l  i n the C e n t r a l  13  5  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s i n the C e n t r a l I n t e r i o r of B.C. - 1954  21  6  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s i n the C e n t r a l I n t e r i o r o f B.C. - 1965  27  7  Number of Sawmills i n B r i t i s h Columbia,  8  B r i t i s h Columbia Sawmill C a p a c i t y ,  9  M i l l L o c a t i o n s and D a i l y C a p a c i t i e s I n t e r i o r of B.C. - 1973  1960-1973  1960-1973 i n the C e n t r a l  28 30 32  ACKNOWLEDGEMENTS  My  thanks  Department  to Dr. Bob North  of Geography  e a r l i e r d r a f t s of t h i s Thanks a l s o  for their  and Dr. B e r t comments  Farley  of the  and suggestions on  thesis.  to my a d v i s o r , Dr. Ken Denike, who was always  encouraging and never l o s t f a i t h that someday a f i n a l t h e s i s d r a f t would  c r o s s h i s desk.  I t has been a p l e a s u r e working with and  l e a r n i n g from Ken i n pursuing both my academic  and p r o f e s s i o n a l  areas of i n t e r e s t . Thanks most o f a l l t o my w i f e , P a t r i c i a , who d i d the t y p i n g and  who has somehow managed  t o endure  a l l the l a t e  l o s t weekends I d e d i c a t e d to f i n i s h i n g my degree.  n i g h t s and  1  CHAPTER 1 INTRODUCTION  The  importance of the f o r e s t i n d u s t r y w i t h i n the economy of 1  B r i t i s h Columbia has However, most of  been w e l l documented by  these s t u d i e s have concentrated  the economic impact of the it  i s at  most  the  felt,  regional  often  situation  is  linkages  made  sector.  upon  analyzing  i n d u s t r y at the p r o v i n c i a l l e v e l ,  and  community  through  the  more  between the  of goods and  numerous s t u d i e s .  loss  scales or  complex  addition  by  basic sector,  that  the  the of  f o r e s t r y , and  impact  jobs.  highly  yet is The  interrelated  the  wide  array  s e r v i c e producing i n d u s t r i e s which form the nonbasic  This  complexity  within  the  economic  system,  when  combined with the r e l a t i v e l a c k of data a v a i l a b l e at the r e g i o n a l and  local  l e v e l s , has  tended to cause a n a l y s t s  to shy  away from  attempting s t u d i e s which i n v e s t i g a t e i n d e t a i l the r e l a t i o n s h i p s between the f o r e s t i n d u s t r y and community or It exist forest  is  the t o t a l economy w i t h i n a s i n g l e  region. the  to allow industry  hypothesis a close  of  this  analysis  study  of  the  that  sufficient  economic  at a s u b p r o v i n c i a l l e v e l and,  impact  data  of  furthermore,  the that  such an a n a l y s i s can be accomplished using e x i s t i n g techniques of measurement, utilized  several  emphasis  which  have  been  by geographers f o r many years.  to suggest that any extremely  of  intricate here  relationship  is  a n a l y s i s could workings to  analyze  between the  of  and and  and  widely  I t would be i n j u d i c i o u s  f u l l y o u t l i n e and the  industry  advanced  economic identify the  explain  system as  other  much sectors  the  but  the  of  the  of  the  2 economy w i t h i n a r e g i o n the data.  as  i s p o s s i b l e given  In a d d i t i o n , there  is l i t t l e  the  constraints  evidence to suggest  of  that  more time-consuming or complex techniques of measurement, such as imput-output  could  do a more  c r e d i b l e job of e x p l a i n i n g the workings of the system.  T h i s view  would  seem  economists better  a n a l y s i s or  to  be  and  econometric modelling,  supported  others  understanding  by  despite of  the  the  the  lack  of  intense  r o l e of  the  such  concern  studies  by  shown f o r  a  forest industry  within  the p r o v i n c i a l economy. The  impetus f o r t h i s t h e s i s was  an  interest in empirically  t e s t i n g some of the b a s i c concepts of c e n t r a l place theory a  group  of  communities  the  a  activity.  In attempting to research  individual  information Even  at  the  superficial  heavily  central  Columbia,  the  region  in  oommunities,  from  regional  of  little  individuals  revealed  from  that no one  the  the  upon  of  British  forest  related  economic s t r u c t u r e s  discovered is  that  virtually  exists  economio  conducted by government agencies. with  was  sources  scale,  treatments  dependent  it  published  interior  beyond  development,  Discussions  government  can  affect  economic  nonexistent. some most  identify  with  a  industry  might  a f f e c t other  degree  while such i n f o r m a t i o n  of  could  certainty economic  how  sources  undertaking.  of  private  nor  of  A better  data  them  industry  trends  sectors.  a basic  could  anyone  within  Most  felt  the that  prove u s e f u l , the complexity of  system does not allow a n a l y s i s using what they p e r c e i v e existing  rather  of the s i t u a t i o n  and  development  and  methods  understanding  of  of the  of  detailed  seems to have a c l e a r p i c t u r e of how  industry  using  handling  the  to be  the  such  an  economic f o r c e s  at  3  work  within  a  region  with  strong  dependence  upon  a  single  e x t r a c t i v e i n d u s t r y would seem to be b e n e f i c i a l to community and regional would  planning  be  groups  particularly  as w e l l  as to p r i v a t e  industry.  u s e f u l i n d e v i s i n g long term development  s t r a t e g i e s as attempts a r e made to p r e d i c t and a d j u s t in  the  basic  interrelated  by  of  empirically  i t s heavy  employment  7  Region testing  thirteen  to  the  resulting  dependence  upon  1),  (see F i g u r e  the hypothesis  communities  were  i n the woods and m i l l s .  number of cases study.  and  effect  upon  forest - related  the c e n t r a l i n t e r i o r of B r i t i s h Columbia, as d e l i m i t e d  Economic  region,  industry  to changes  industrial sectors.  Because activity,  It  has  of t h i s  been  study.  determined  chosen f o r Within  this  as having  These provide  a  high  sufficient  f o r t e s t i n g the methods of a n a l y s i s used i n t h i s  The r e g i o n not only r e p r e s e n t s  a convenient  statistical  u n i t , thus f a c i l i t a t i n g data c o m p i l a t i o n and a n a l y s i s , but  also  forms a r e l a t i v e l y cohesive f u n c t i o n a l r e g i o n w i t h i n which P r i n c e George  serves  important  as the h i g h e s t  order  center.  British this  historical  development  study.  Discussion  i n d u s t r y i s necessary  region. of  of the h i s t o r i c a l  of how the i n d u s t r y operates  Chapters 3 and 4 .  i n order  century of development between  industry  within  development  i n conjunction  begins  o f the  the reader with a f i r m  to c l e a r l y  Chapter 2  industry.  i s o u t l i n e d i n Chapter 2 of  because i t provides  T h i s i s needed  forest  o f the f o r e s t  Columbia's c e n t r a l i n t e r i o r  knowledge  provides  goods and s e r v i c e s to many o f the o u t l y i n g communities  and a c t s as the f o c a l p o i n t o f the region's The  The c i t y  with the  f o l l o w the analyses  with  the f i r s t  half-  1 9 0 7 and 1 9 5 3 , when the r e g i o n was  1  0°  ,  20°  ^Created in 1968.  Miles  FIGURE  1:  LOCATION  OF STUDY  AREA.  5 still  v e r y much a p a r t  discussion of  the  railway  s y s t e m and  influenced  industry.  By  1953,  discussion  the  is  to  examine  and  understanding  locational  pattern  part  detail  how  had  pattern  economy  of  the  the  defined.  i n d u s t r y and  development  the  internal  of  become w e l l  development  of  have  their  emphasized t h a t the i n t e n t here  the  this  construction  o f C h a p t e r 2 c o n c e n t r a t e s upon  I t must be  in  rather  communities  spatial  the  The  advancements, t h a t  h o r i z o n t a l i n t e g r a t i o n of the  implications.  but  present  latter  spatial  itself  technological  the  i n the  t h e v e r t i c a l and  not  province's resource f r o n t i e r .  f o c u s s e s upon t h o s e f a c t o r s , s u c h as  strongly  The  of the  of  has  region.  workings  the  affected  A  of  the  industry the  comprehensive  industry  in  the  p  region  can  In  be  o b t a i n e d f r o m D.  Chapter  3,  the  Mullins*  discussion  Analysis  and  i t s a p p l i c a t i o n to  region.  The  first  and  investigates  major  focuses  techniques  s t r e n g t h s and  of  upon  a number o f  s e c t i o n r e v i e w s the  the  study.  communities  development of the  weaknesses of  measurement.  This  is  e m p i r i c a l f i n d i n g s o f a v a r i e t y o f C a n a d i a n and which  have  analyzing section the  the  of  Economic  interior's The  economic r e s u l t s of  or  several  this  as  theory of i t s  American  studies  the  of  are  the  it  The  in  final  analysis  i t relates  analysis  the  by  forest industry.  structure  in  followed  variants  f i n d i n g s of  Base  to  of the  compared  to  f o u r t h c h a p t e r , a more c o m p l e x method o f a n a l y s i s  is  It involves  to  studies.  In the presented.  Analysis  c h a p t e r p r e s e n t s the  industry.  other  Base  economic impact of the  the  central  forest the  used  Economic  the  a p p l i c a t i o n of a dynamic approach  6  tracing  linkages  economy. fully light  upon and  interrelate. which  the  industry  and  the  rest  the system but the i n t e n t here i s to shed  how  the  regional  to suggest  the  how  economy some  i s tied  of the more  to  further  the  forest  salient  forces  The chapter i s d i v i d e d i n t o three s e c t i o n s , each of  analyzes  and  employment, earnings,  discusses  different  types  of  of t h i s t h e s i s .  data  and unemployment.  Chapter 5 presents a summary of the f i n d i n g s and  conclusions  Based upon the f i n d i n g s reached here, some areas  of a n a l y s i s which seem worthy of f u r t h e r outlined.  of  As p r e v i o u s l y mentioned, no a n a l y s i s can be expected to  explain  industry  between  research  are  briefly  7  CHAPTER 1 Footnotes 1.  For detailed information on the forest industry's c o n t r i b u t i o n to the p r o v i n c i a l and f e d e r a l economies, see F.L.C. Reed and A s s o c i a t e s , The B r i t i s h Columbia F o r e s t Industry - I t s D i r e c t and I n d i r e c t Impact on the Economy ( V i c t o r i a : Province o f B r i t i s h Columbia, Department o f Lands, F o r e s t s and Water Resources, 1 9 7 3 ) . A second e d i t i o n o f the Reed r e p o r t was p u b l i s h e d i n 1 9 7 5 which c o n t a i n s more recent s t a t i s t i c s on some aspects of the i n d u s t r y . See a l s o Peter H. Pearse, Timber Rights and F o r e s t Polioy in B r i t i s h Columbia ( V i c t o r i a : Report o f the Royal Commission on F o r e s t Resources, September, 1 9 7 6 ) .  2.  Doreen K. M u l l i n s , Changes i n L o c a t i o n and S t r u c t u r e i n the F o r e s t Industry of North C e n t r a l B r i t i s h Columbia, 1 9 0 9 - 1 9 6 6 (Unpublished M.A. Thesis, Department of Geography, U n i v e r s i t y of B r i t i s h Columbia, September, 1 9 6 7 ) .  8 CHAPTER 2 THE  DEVELOPMENT  OF  THE  FOREST  INDUSTRY  IN  CENTRAL  BRITISH  COLUMBIA  In order  to gain an understanding of the c u r r e n t  of the f o r e s t i n d u s t r y relationship  to  the  i n the c e n t r a l i n t e r i o r , overall  economy  of  as w e l l  the  i n d u s t r y ' s h i s t o r i c a l trends  a l s o allows  as  region,  necessary to examine i t s development i n some d e t a i l . the  structure its  i t is  Analysis of  some s p e c u l a t i o n as  to f u t u r e d i r e c t i o n s which the i n d u s t r y may take and how t h i s i n turn  may  affect  other  sectors  of the economy.  The task i s  accomplished through a review of r e l e v a n t l i t e r a t u r e and data on the  region  designed and  and with the a i d of a s e r i e s of maps which have been  to t r a c e  function  the changes  of the wood  emphasis  throughout  important  part  region's 2.1  the  i n the l o c a t i o n a l p a t t e r n ,  processing chapter  m i l l s through  i s upon  size,  time.  demonstrating  The the  which the f o r e s t i n d u s t r y has had i n shaping the  economic development.  The E a r l y Years of Development:  1907-1953  In p i n p o i n t i n g the s i n g l e g r e a t e s t impetus behind the growth of the c e n t r a l i n t e r i o r ' s f o r e s t i n d u s t r y , identified with  as the c o n s t r u c t i o n  the Grand  National  Trunk  Pacific  Railway) and l a t e r  Great E a s t e r n P r i n c e George.  i t can most l i k e l y be  of the r a i l w a y (soon  with  system,  beginning  taken over by the Canadian  the completion  of the P a c i i c  (renamed the B r i t i s h Columbia Railway) through to The improved a c c e s s i b i l i t y which these r a i l  lines  gave to the r e g i o n d i d not c r e a t e an i n s t a n t demand f o r the vast stands  o f timber  a v a i l a b l e , but i t d i d allow  existing  forest  9 companies  and  consider  entrepreneurs  the  possibility  with  of  placing  p r e v i o u s l y remote area of the Prior  venture  capital  milling  to  at  operations  in  a  province.  to the b u i l d i n g of the G.T.P. between 1907  the only f o r e s t  least  and  1914,  i n d u s t r y i n the area c o n s i s t e d of a small number  of m i l l s , no more than a dozen at most, l o c a t e d i n a few s c a t t e r e d communities and and  producing  shakes f o r l o c a l use.  of the p r o v i n c e ' s was  rough-sawn dimension lumber, s h i n g l e s , The  frontier.  still  In the northern  very much a part  p o r t i o n the economy  based on f u r t r a p p i n g , mineral e x p l o r a t i o n , and s m a l l pockets  of a g r i c u l t u r e , the l a t t e r the  Fraser,  was  confined  beginnings only  r e g i o n was  Nechako, and to  a  few  many years  l o c a t e d mainly along Bulkley  small  Fraser  were founded  having  been  towns,  before  a minimum of goods and i n 1806  established  Rivers.  of  by  and  had  still  their offered  F o r t S t . James and  F o r t George i n 1807,  Simon  Fraser  and  around Quesnel and  c a t t l e ranching. during the  other  little  was  but  Lake, there  Gold  gone,  worked  Rush of the  most out  of  claims  the  1860's but  settlers  and  nearly  reminder of the b r i e f p r o s p e r i t y of the Meanwhile, decades  old  exceeding brought  by  on  and  100  was  T h i s area had a l r e a d y experienced  the Cariboo  gold  Williams  Northwest  the  firmly M.B.F.  water  from  coast  the  daily along  farming  and  a boom p e r i o d  away,  deserted  industry  Dozens 1  capacity, the  the  when  leaving  towns  as  a  region.  forest  entrenched.  To  afterwards,  moved  Fort  a l l three  Company o f f i c i a l s d u r i n g t h e i r e x p l o r a t i o n of the r e g i o n . south,  of  settlement  which  as t r a d i n g posts  and  terraces  Clustered  some  services.  the  coast  were of  of  was  already  sawmills,  some  processing  logs  the  mainland  and  10 Vancouver more  Island.  were  One  under  pulp  mill  construction.  i n production  W.G.  Hardwick's  province's  coastal  horizontal  i n t e g r a t i o n o f t h e wood p r o c e s s i n g  their  forest  was  industry  emphasizes  c e n t r a l i z a t i o n i n the S t r a i t  and  several  study  the  of  the  vertical  and  u n i t s , as w e l l  of Georgia  region,  which  as was  p  occurring the  by t h e e a r l y  timber  companies this  supply  had  1900's.  in  remote  upon  cheap  companies  coast,  truck  The through  industry.  was  of logs  announcement the c e n t r a l  i n the r e g i o n  i t s proposed  being  a  that would  providing  ties,  route.  proximity  the  G.T.P.  and  had  s p r u n g up.  material,  the  development  Ironically,  upon  years on  rail  and  shipping. of  sparked  Investors  the a  took  t o where t h e r a i l  forest industry  sawmills cedar  raw  reliance  proceed  d e v e l o p m e n t had expanded c o n s i d e r a b l y .  New  i t s heavy  construction  By t h e c o m p l e t i o n o f t h e l i n e  sporadic.  with  G.T.P.  flurry a  of  sudden  and h u n d r e d s o f a p p l i c a t i o n were made f o r  in close  o f an e x p o r t o r i e n t e d  followed.  the in  l e d to  the l o c a t i o n a l p a t t e r n  t h a n upon  1907  interior  interest  be b u i l t . ^  rather in  along  situated  to duplicate  difference  activity  timber  of  forest  the major  transport  transport  interior  interior  the  water  product  which  had been e s t a b l i s h e d ,  interest  later  forest  of scale  little  of  the  which u l t i m a t e l y  showed  potential the  an  decisions  the economies  Once t h e l o c a t i o n a l p a t t e r n  coastal  locations,  made d e l i b e r a t e  c e n t r a l i z a t i o n and  dependence  Rather than p l a c i n g the m i l l s at  were  poles,  catering  T h i s marked  other  t o t h e needs  construction  T h e s e s a w m i l l s were o r i e n t e d  to and  the beginning  alongside  of the  was  population  but t h e g r o w t h was  located  and  i n 1914,  line  the  s l o w and railway,  material  communities  towards the  to  which eastern  11 s i d e of the r e g i o n , on George and existed.  Valemount  t h a t s e c t i o n of the l i n e  where some a g r i c u l t u r e  The area contained prime timber,  and was  economic  precarious. decreased  stability  Once demand  the for  were simply  businesses,  some of  stops  along  the  railway ties  communities  of  these was  and  line.  served After  lumber.  products.  Thus,  employing year.  The  and  operating  mills.  of  was  the  purpose  sudden  with  a new  a  than  initial  few rail  growth,  i t the need f o r lumber  or  three months  each  m i l l s changed hands o f t e n , as w e l l as s u f f e r i n g  from  frequent f i r e s which completely J.H.  Many  greater  of  there  remained  men  majority  very  mills  few  the  was  of r e s i d e n c e s and  their  development slowed c o n s i d e r a b l y and  mills  completed,  no  already-  Provinces.  early  small c l u s t e r s  which  settlement  including Douglas-fir,  c l o s e to the market i n the P r a i r i e  The  between P r i n c e  the  only  two  destroyed s e v e r a l o p e r a t i o n s .  Kenney c i t e s four major reasons Besides  the l i m i t e d  small,  f o r the f a i l u r e of the  l o c a l demand, the m i l l s  were faced  with the high c o s t of s h i p p i n g , the d i s t a n c e from l a r g e consuming markets,  and  a t t r a c t new resulted  severely  of  jobs  Two  and  Demand was  One. some  and  facilities  major events  curtailing  from the c e n t r a l  of World War  had  lack  settlers.  in  products  ceased  a  the  interior.  took  The  existing  settlers  left  Panama  Canal.  first  forest The  to  region  market was  join  to  which  for  the  The P r a i r i e market c o l l a p s e d as new  f u r t h e r reduced  interior  the  place i n 1914  export  wood  outbreak  settlement  the  military.  by crop f a i l u r e s a year e a r l i e r which  f i n a n c i a l l y hurt many of the farmers.  fledging  in  industry  coastal  was  industry  The second blow to the the was  completion able  to  of  take  the full  12 advantage of the c a n a l to s e r v i c e the E a s t e r n U.S. seaboard and the United Kingdom, the two major A t l a n t i c markets. mills  couldn't  complete  with  the much  lower  The i n t e r i o r  costs  that  water  shipment a f f o r d e d . Despite  the adverse  faced,  some m i l l s  became  a  economic c o n d i t i o n s which the i n d u s t r y  continued  permanent  c r e a t e d and helped  part  to operate  intermittently  of the r e g i o n a l  economy.  and they They had  s u s t a i n many s m a l l towns, some of which  still  bear the names of the o r i g i n a l f o r e s t companies.  East of P r i n c e  George,  intervals  located  at  regular  15  to  20  mile  are  communities such as Lamming M i l l s , C o r n e l l M i l l s , S i n c l a i r M i l l s , 5 and  Hutton M i l l s . A f t e r the war ended i n 1918, the economy of the r e g i o n began  to  pick up.  A good market had opened f o r p i t props i n B r i t a i n and  there was some demand again, although P r a i r i e Provinces.  r a t h e r u n s t a b l e , from the  P o p u l a t i o n was on the i n c r e a s e as hundreds of  s e t t l e r s , many of them a s s i s t e d by the S o l d i e r Settlement moved i n to the area, p a r t i c u l a r l y west of P r i n c e George.^ established  themselves  i n agriculture  1921, the r e g i o n  gained  Most  but part-time work i n the  woods and m i l l s became a common means o f supplementing In  Board,  i t s second  railway  incomes. with the  completion of the P a c i f i c Great E a s t e r n l i n e from Squamish on the 7 south coast through development industry.  Mile  offer  i n i t s early  T h i s new l i n k s t i m u l a t e d  years,  particularly  i n the  little forest  As F i g u r e 2 i n d i c a t e s , there was not a s i n g l e m i l l o f  significant 100  to Quesnel.  size  House.  l o c a t e d along The c e n t r a l  the route interior  as i n c e n t i v e to companies  from Quesnel south to  seemingly  contemplating  had l i t t l e  expansion.  to The  13  Mill T y p e & Daily C a p a c i t y •  10-20  #  21-50  O  51-100  Sawmills (MBJJ  o  40  80  120 I  160 I  Miles  Q  101-500 over 500  A  Pulp & Paper  •  Plywood  FIGURE 2. MILL LOCATIONS AND DALY CAPACITIES IN THE CENTRAL INTERIOR OF B.C. - 1926  14  1930's,  which  brought  economic  country,  further  continued  i t s dominance o f t h e f o r e s t  stated very  f a r from  perpetually  will  their  very  fighting  until  market a r e s u c h to u t i l i z e  to  region's  report  of the  The  F.D.  of long  that  rail-haul  increase  coast  Mulholland  "The s a w m i l l s  markets  conditions  that i tw i l l  economy.  that,  t h a t any g r e a t  economic  a l l parts  industry.  competitive  the handicap  It i s unlikely  occur  the  1 9 3 7 government  in a  charges.  depressed  hardship  a r e so  they  and  are  freight  in utilization  affecting  the world  pulp  be p o s s i b l e t o c o n s t r u c t a p u l p - m i l l  some o f t h e s p r u c e ,  or u n t i l  greatly  i n c r e a s e d demand  q  develops in  on t h e P r a i r i e s . "  the r e g i o n ,  previously  by  even  Without no s o u r c e  the Depression  fewer  3),  (see F i g u r e  employer. virtually  with  Despite  work  the small s c a l e of f o r e s t r y i n 1936  mills  t h e i n d u s t r y was in  the  o f income  economy.  woods  than  still  or  ten  an  important  mills,  there  f o r many o f t h e s e t t l e r s  Mulholland  describes  years  was  h i t hard  the only  other  10  industrial  payrolls  construction  as  being  the  railway  and m a i n t e n a n c e o f government  (C.N.R.)  and  the  roads. 11  A  interesting  technological This  level  observation  from  poor  was  markets,  resource  exploitation  entrepreneurs stands best  were  dictated  w i t h i n a few m i l e s  timber  depressed  was  often  demand.  on  To  by  a  lack  restricting  the  t h e low  the  sites  location  of  push  utilized  back  into  which  capital  sawmills  mill  r a d i u s of the r a i l w a y .  not being  of  This severely limited  and by  caused  thus  l o c a t i o n s p r o x i m a t e t o t h e C.N.R. of  by M u l l i n s  o f t h e i n d u s t r y i n t h e r e g i o n up u n t i l 1 9 3 9 .  c o n d i t i o n , she m a i n t a i n s ,  resulting  i s made  the area  chosen prime  to  by  timber  Therefore, the i n turn  the p l a t e a u  further  districts,  Mill Type & Daily •  10-20  •  21-50  © Q  51-100  Capacity  Sawmills CMBJJ  o  i_  101-500 over 500  / \  Pulp & Paper  •  Plywood  40 _L_  80 I Miles  120 _l  160 I  FIGURE 3: MILL LOCATIONS AND DAILY CAPACITIES IN THE CENTRAL INTERIOR OF B.C. - 1936  16  logging  operations  difficult  needed  and expensive  to  construct  undertaking  adequate  roads,  which few companies  a  seemed  able or w i l l i n g t o a f f o r d . Stimulated World  War as l a r g e  Prairies other  development came with the beginning o f the Second quantities  and elsewhere  military  o f lumber  were  f o r the c o n s t r u c t i o n  installations.  The demand  required of a i r  on the  bases and  f o r lumber  further  increased  a f t e r the war ended and housing s t a r t s jumped.  triggered  tremendous expansion  mills  rushing  indicates,  into  companies s t i l l  daily.  The l a r g e  the  central  interior,  although p o r t a b l e ,  majority  but the road o f the m i l l s ,  established George  As F i g u r e  limited  established  thus  4  i n terms o f  forest  area  were s t i l l  network  product  tied  the  small  These s m a l l e r  to l o c a t i o n s  adjacent  A few were u t i l i z i n g  was q u i t e  truck  rudimentary.  The  i n c l u d i n g the l a r g e r u n i t s , were i n the  o f development  t o Valemount  i t was  t o b u i l d the i n d u s t r y .  to e i t h e r the B.C.R. or C.N.R. l i n e s . transport  demand.  were not w i l l i n g t o commit themselves to p l a c i n g  entrepreneurs who continued mills,  to meet  with new  c a p a c i t y with most capable of only ten t o twenty  M.B.F. o f lumber  in  production  many o f these m i l l s were q u i t e  d a i l y production  mills  i n the f o r e s t i n d u s t r y  This  but s e v e r a l  along dozen  the C.N.R. from smaller  Prince  operations  had  l o c a t e d i n the v i c i n i t y o f Quesnel and Williams  Lake t o the south  and  Expansion  along  industry wishing  the l i n e into  these  west  of Prince  latter  to l o c a t e near  areas  George.  was necessary  both good timber and r a i l  o f the  f o r new m i l l s service  since  the f o r e s t s i n the eastern s e c t o r were a l r e a d y l a r g e l y a l l o c a t e d .  17  Mill Type & Daily Capacity •  10-20  #  21-50  H)  51-100  Q  Sawmills GVLBJJ  o  101-500  O  over 500  / \  Pulp & Paper  •  Plywood  40 _L_  80 l Miles  120 I  160 —J  FIGURE 4. MILL LOCATIONS AND DALY CAPACITIES IN THE CENTRAL INTERIOR OF B.C. - 1948  18  Considerable around Grand  Prince Trunk  George  as  the  under  significant while  it  rest  of  the  importance  the  mills thus  town  located  The  for  and  the  had  responsible  long  delayed  over  brought  s h i p p i n g on t h e  the  lower  rapid  that  a lack to  railway  and  central  number  and  coastal  of  George a  large  industry, allowed  locational  reliable  large which  Prince  services  the  size  agglomeration  of  as  services  services  Figure  growth 5).  development.  B.C.R.  line  pattern  and a s k i l l e d  and  sufficient  As w e l l ,  to  the  Two  major  The  first  from Quesnel  northern section  coast.  in  of  by t h e  greater  (see  the  the  a  timber.  even  this  giving  set  town,  requiring a  miles  a dispersed  access  industry for  as  processed  completion of  1953,  example  the  George  A sizeable  of  in  Its  government  dozen  recognized  limited  forest  dominate  availability  savings  raw and  were  in  several  Prince  developed.  many  Prince  fluctuations  headquarters.  such problems  1950's  interior's  George  from  as  the  the  along  order businesses  well  within  economic  force  transport  as  regional  mills  presented  labour  interior  F o l l o w i n g the  interior  substantial  to  a  benefitting  which  central  gave  economic to  when  a n d a b u i l d i n g boom  growth  continued  and  use  reached  site  in  opertions  settlements  same  many h i g h e r  as  force.  the  would  its  line  the  of  other  it  population  had  labour the  the  attracted  threshold used  region,  as  burst  over  experienced  in  it  of  place  importance  that  rail  heavily  early  advantage  and  the  taking  gained  announced  time  This  had  was  headquarters  invested  way.  town  Railway  the  had  development  The  regional  By  speculators  location  George.  Pacific  province.  was  post-war  of  the  central factors was  the  to  Prince  region  access  many g o o d s a n d  services  r e q u i r e d by the i n d u s t r y c o u l d now be obtained more r e a d i l y and o f t e n a t a lower post-war and  cost.  technology  created better  The second  which allowed  f a c t o r was the much f o r easier  improved  road c o n s t r u c t i o n  l o g g i n g and t r a n s p o r t equipment.  Harvesting  o p e r a t i o n s began moving i n t o remote areas with good timber which  had p r e v i o u s l y been  transport to m i l l  economically  stands  u n f e a s i b l e to l o g  and  locations.  The completion o f the B.C.R. l i n e to P r i n c e George has been 12 viewed  by some a n a l y s t s ,  important  stimulus  interior.  to  including  resource  P. Gamble,  development  The C.N.R. had f o r many  years  as the most i n the  enjoyed  central  a  virtual  t r a n s p o r t a t i o n monopoly on the export o f wood products from the region  y e t had done  Lawrence  cites  attitude  towards  empty  from  charging  little  t o encourage  industrial  the r a i l w a y f o r i t s p a r t i c u l a r l y the lumbermen.  the P r a i r i e s  the m i l l s  C.N. r a i l  to the m i l l s  f o r the c o s t  uncooperative  cars  to take  o f running  growth.  would  travel  on lumber,  the oars  i n both  directions.  As w e l l , the C.N.R. made v i r t u a l l y no attempt  development  o f the i n d u s t r y by promoting  products Rupert. that,  through  i t s western  terminus  the export  a t the port  thus  to a i d  o f wood of Prince  Harold Moffat, ex-mayor o f P r i n c e George, s t a t e d i n 1972  "...the  P.G.E. has been  the main  impetus  t o our growth.  Although the Grand Trunk P a c i f i c and l a t e r the Canadian N a t i o n a l were here  f o r many years  prior,  they  did l i t t l e  or nothing to  s t i m u l a t e growth mostly due t o the r a t e s t r u c t u r e that i s managed 13  from  Montreal."  2.2  Rapid Development i n the Region; The  1954-1975  l o c a t i o n of new m i l l s coming i n t o o p e r a t i o n a f t e r 1954  20 tended to r e i n f o r c e the p a t t e r n p r e v i o u s l y e s t a b l i s h e d .  Many o f  the new m i l l s were small i n comparison to c o a s t a l u n i t s and were capable  of producing  less  than  50 M.B.F.  of lumber  per day.  However, what they lacked i n s i z e they made up f o r i n numbers and interior  lumber  production  production  (see Table I ) .  was q u i c k l y  catching  up to c o a s t a l  The s m a l l e r m i l l s were mostly p o r t a b l e  and s t a t i o n e d themselves i n the woods a t the l o g g i n g s i t e s .  They  were t a k i n g advantage o f the growing road system f o r the t r u c k i n g of t h e i r products, u s u a l l y rough-cut lumber, to c o l l e c t i o n p o i n t s along the r a i l l i n e s f o r f u r t h e r p r o c e s s i n g and export by r a i l to market  or to the coast  placing smaller m i l l s continued  over  penetrated  f o r t r a n s f e r to s h i p s .  This  system o f  i n the woods was r a t h e r s h o r t - l i v e d but i t  the next  decade as timber  f u r t h e r i n t o the p l a t e a u  harvesting  operations  areas.  Along the B.C.R. and C.N.R. l i n e s , the l a r g e r m i l l i n g u n i t s were  agglomerating  i n or near  centers  which  had a l r e a d y  i n v o l v e d i n f o r e s t r e l a t e d a c t i v i t y f o r many years. notable mills  i n Figure  5 i s the c o l l e c t i o n  i n the v i c i n i t y  handling  a l l stages  Particularly  of approximately  of P r i n c e George.  sixty  Some o f the m i l l s were  of p r o c e s s i n g while others were planer  mills  which s p e c i a l i z e d i n the l a t t e r stages of lumber p r o d u c t i o n . same  type  especially  o f development Smithers,  Each was g a i n i n g  Burns  was  taking  Lake,  been  place  Quesnel,  c o n t r o l over a l o g supply  i n other  The  centers,  and W i l l i a m s  Lake.  r e g i o n , the s i z e of  which was d i c t a t e d by t r a n s p o r t d i s t a n c e and c o s t as w e l l as the p r o c e s s i n g c a p a b i l i t i e s of the m i l l s i n each c e n t e r . sawmills Prince  were l o c a t e d George.  This  i n the upper F r a s e r was  the area  where  River  The l a r g e s t  valley  the r e g i o n ' s  east o f forest  Mill T y p e & Daily C a p a c i t y  •  10-20  #  21-50  Q  51-100  Sawmills  (MJBIJ  Q  O  i_  P u ,  P  &  500 Paper  Plywood  40  80 i  120 I  160 I  Miles  101-500 over  A  o  FIGURE 5. MILL LOCATIONS AND DALY CAPACITIES IN THE CENTRAL INTERIOR OF B.C. - 1954  TABLE I - COAST AND INTERIOR LUMBER PRODUCTION, 1951-1976 Year  Coast  Interior* (Thousands  B.C.  Total  o f Board F e e t )  1951 1952  2,519,528  1,294,349  3,723,877  2,275,508  1,420,951  1953 1954  2,571,631  1,474,093 1,695,046  3,696,459 4,045,724  1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976  2,683,649 2,756,096  2,158,189  2,454,177 2,352,481  2,280,793 2,059,906  2,565,492  2,284,473  4,849,965  2,345,656  2,602,929  2,849,803 2,955,950  2,455,315  4,948,585 5,305,118  2,019,555 3,395,952  2,984,303 3,338, 1 19  3,492,091 3,649,485  3,603,191 3,800,000  3,680,245 3,912,894  3,638,863 3,196,900  4,144,306  3,666,833 3,784,848  7,811,139 7,695,606  3,867,078  3,910,758  4,914,285 4,734,970 4,412,387  2,663,747  5,619,697 6,003,858 6,734,071 7,095,282 7,449,485 7,319,108 7,109,794  3,789,609 4,184,918  4,752,488  4,027,086  5,478,952  7,656,687 8,937,406 9,506,038  4,401,675 3,403,100 2,500,600  6,021,906  10,423,581  5,338,795 4,944,695 6,638,610  8,741,895 7,445,295 10,626,116  3,987,506  *The i n t e r i o r lumber p r o d u c t i o n f i g u r e s districts  4,378,695  include a l l forest  i n the i n t e r i o r o f B . C . , not j u s t  interior  region.  Source:  Statistics  i n the c e n t r a l  Canada, Canadian F o r e s t r y  C a t a l o g u e 25-202 ( A n n u a l ) .  Statistics,  23 industry Years  had  o r i g i n a t e d and  before,  harvest  and  they  now  had  the  secured  mills  were f i r m l y  large tracts  to r e t a i n t h e i r h i s t o r i c a l the exception The the  1910's and  centers. the  made up  longer c r e a t i n g new  the  C.N.R. with  of  around  i n or near  were c o n t r o l l e d by,  mills  towns but  owned  by  the  different  or  to concentrate  interest  in  the  alien  operators The  who  conjunction  with  the  was  on  the  upon  an  together  upon c o a s t a l f o r e s t r y To  and  commence equipment  c a r e f u l l y developed system of  processing. growth of  growth of the p o p u l a t i o n , activity  one  l a r g e companies  central interior.  to t h e i r  h a r v e s t i n g , t r a n s p o r t i n g and  milling  existing  dependence was  i n d u s t r y of the r e g i o n .  continued  which were l a r g e l y  rapid  in  milling  dependent upon,  o p e r a t i o n s i n the r e g i o n meant a d j u s t i n g to methods and  In  i t had  communities could not be l a b e l l e d company towns i n  the f o r e s t  little  towns as  grew up  towards l o c a t i n g  They were m i l l s  on the coast showed  no  trend was  sense t h a t they  assortment  road.  towns the m i l l s tended  l i n e a r p a t t e r n along  1920's when communities  The  The  company.  them by  for  of the newer m i l l s near Valemount.  i n d u s t r y was  operations.  of good timber  the companies were a b l e to access  However, r a t h e r than c l u s t e r i n g i n t o a few  established.  the  especially  increase  forest i n the  (see Table  George, the p o p u l a t i o n t r i p l e d between 1951  and  industry centers  II). 1961  was  where  In  Prince  with much of  the i n c r e a s e o c c u r r i n g i n the e a r l y 1950's around the time of the completion experienced  of  the  the  Equally  significant  i n Quesnel, W i l l i a m s Lake, Smithers,  With each succeeding to  B.C.R.  point  increases and  were  Vanderhoof.  census, more c e n t e r s had grown i n p o p u l a t i o n  where they  gained  the  s t a t u s of  individual  census  TABLE II - POPULATION OF CENTERS IN ECONOMIC REGION 7* 1956  1961  1966  1971  24,471 113 652 656  33,101 2,332 658 693  CENSUS DIVISION 14  1921  1931  1941  1951  P r i n c e George MacKenzie McBride Valemount  2,053  2,479  2,027  4,703  10,563  13,877  237  489  582  590  218  801  1,016 615  759  1,204  350  644  1,962 580 1,085  1,041 1,081 699 2,487 576 1,460  1,290 1,213 699 3,135 668 1,507  1,367 1,483 2,232 3,864 712 1,653  653 540  1,587 913  4,384 1,790  4,673 2,120  5,725 3,169 829  6,252 4,072 1,120  CENSUS DIVISION 2 Burns Lake F o r t S t . James Houston Smithers Telkwa Vanderhoof CENSUS DIVISION 4 Quesnel W i l l i a m s Lake 100 M i l e House  *A11 of the centers l i s t e d were i n existence p r i o r to 1921 with the exception of MacKenzie which was incorporated i n 1966. Any center without a p o p u l a t i o n f i g u r e before 1966 was too small to be considered a separate census s u b d i v i s i o n or enumeration area. Source: S t a t i s t i c s Canada, Censuses of Canada,  1921-1971. 4="  25  subdivisions. can  I t would be m i s l e a d i n g  to i n f e r  that  a l l be a t t r i b u t e d to the f o r e s t i n d u s t r y .  development, period, Fraser  particularly  some of which Lake  responsible  mining, was t a k i n g  eventually  and G r a n i s l e .  dominated  However,  this  Other place  industrial  during  communities  the f o r e s t  f o r a l a r g e measure o f the p o p u l a t i o n  growth  this  such as  industry  was  growth through  e i t h e r d i r e c t employment or i n d i r e c t l y by s t i m u l a t i n g development of s e r v i c e i n d u s t r i e s . In the eleven  year p e r i o d between 1 9 5 4 and 1 9 6 5 , the number  of r e g i s t e r e d m i l l s Table I I I ) .  i n the r e g i o n  increased  from 1 6 8 t o 2 3 5 (see  The e a r l y 1 9 6 0 ' s marked the high p o i n t i n the growth  of m i l l i n g o p e r a t i o n s  and by the l a t t e r part o f the decade, t h e i r  numbers were q u i c k l y d e c l i n i n g while the average d a i l y capacity  of each m i l l  was i n c r e a s i n g .  production  Of the m i l l s  shown i n  F i g u r e 6 , over one h a l f were u n i t s capable of l e s s than 2 0 M.B.F. of lumber d a i l y . to move g r e a t e r evidence and  distances  of the i n c r e a s e d  logging  mills  As t h e i r l o c a t i o n s i n d i c a t e , they had continued  road  network.  complexity However,  lines  indicated i n Figure  operation  declined  addition,  Table  sawmills  throughout  I I I shows  the l a r g e  i n the c e n t r a l  to 6 4 with most  disappearing.  interior  of the m i l l s  roads,  secondary  number of small  to be c o n t r a d i c t o r y  7 where the number of u n i t s i n  the province  that  and major  of the r e g i o n ' s  i n d i c a t e d on the map appears a t f i r s t  to the trend  235  from the r a i l  by  i n the 1 9 6 0 ' s .  1 9 7 3 the t o t a l  had d e c l i n e d  number o f  drastically  i n the 1 0 - 2 0 M.B.F.  Van S c o f i e l d of the Northern  In  from  category  I n t e r i o r C o u n c i l of  F o r e s t I n d u s t r i e s suggested that although each of the m i l l s would have  been  registered  with  the p r o v i n c i a l F o r e s t  Service,  many  TABLE I I I - NUMBER AND SIZE OF MILLS IN THE CENTRAL  D a i l y Capacity  Year  10-20  21-50  51-100  (M.B.F.)  101-500  INTERIOR  Total Daily  T o t a l Number  Maximum Capacity *  of M i l l s  Over 500  1926  4  13  2  930  19  1936  2  9  2  690  13  1948  61  14  4  2,320  79  1954  135  27  4  2  5,457  168  1965  125  76  29  5  11,700  235  1973  16  20  5  21  13,320  64  *Based on upper value of each d a i l y Source:  c a p a c i t y category.  The "ABC" B r i t i s h Columbia Lumber Trade D i r e c t o r y and Year Book (Vancouver: Progress P u b l i s h i n g Company).  ON  27  Mill T y p e & Daily •  10-20  •  21-50 51-100  (P  Capacity  Sawmills (MBJJ  0  l_  over 500  80  120 I  160 I  Miles  101-500  Q  40  FIGURE 6. MILL LOCATIONS AND DALY CAPACITIES  / \  Pulp & Paper  •  PlvWOOd 7  ( T h o u s a n d ft. - 3/8 i n j  IN THE CENTRAL INTERIOR OF B.C. - 1965  FIGURE 7 - NUMBER OF SAWMILLS IN BRITISH COLUMBIA, 1960-1973  00 H M S3  2500  -  2000  -  1500  Operating  1000  Non-operating  500  1960  1961  1962  T961  1961  T965  V9U  TWf  f968  T9E9  i"970  Source: Derived from annual s t a t i s t i c s of the B.C. F o r e s t S e r v i c e Reports Government of B r i t i s h Columbia).  f971  1972  1973  (Victoria:  IV)  00  29 were no  longer  o p e r a t i n g by  1965,  not  even  on  an i n t e r m i t t e n t  basis.^ ^ The  decrease  indicates  the  operations.  in  trend The  the  number  of the  of  mills  during  i n d u s t r y towards  the  1960's  large, centralized  small operators could not economically  compete  with the growing number of m i l l s capable of producing hundreds of thousands of board l o c a t e d adjacent  f e e t of lumber d a i l y .  to r a i l  s e r v i c e i n order to supply  markets of E a s t e r n Canada and of lumber was  These l a r g e complexes  the United S t a t e s .  a l s o moving south  the B.C.R. to Vancouver  f o r water  markets.  The h a r v e s t i n g , p r o c e s s i n g , and marketing  become  highly  complex  small operators found rose.  to Asian  and  growing  A l a r g e amount  Squamish  a  shipment  on  the  and  western U.S.  and  seaboard  of lumber had  s o p h i s t i c a t e d business  which  themselves incapable of h a n d l i n g as  the  costs  Lumber p r o d u c t i o n d i d not s u f f e r with the disappearence  these s m a l l e r m i l l s because each of the l a r g e m i l l s was as much as the combined t o t a l  of  producing  of a dozen or more of the s m a l l e r  o p e r a t i o n s (see F i g u r e 8 ) . I n t e r i o r lumber p r o d u c t i o n kept pace with the c o a s t a l f o r e s t i n d u s t r y and the  point  i n 1970  where  much lumber  in  1975  (see Table  industry's equipment  i t permanently moved ahead of the coast  declining in  its  the I).  interior  produced  of  with  share  mills.  lay  Some  operations  they  were  required extensive renovations.  quickly  large,  prime  that  production  while  of  timber  becoming d e p l e t e d .  as  f o r the c o a s t a l  unfeasible  stands  twice  Much of the reason  economically others  nearly  to  The  located mills  shut  along  had down  the  aging  become  so  permanently  Furthermore, the  coast  the were  were f o r c e d to a d j u s t  to  FIGURE 8 - BRITISH COLUMBIA SAWMILL CAPACITY*, 1960-1973 30  -p CD CD CM  25  X)  ca  o CM  o  20  w c o  15  E-i l-H  o <:  10  PL,  Non-Operating  1960  T961  T9o2  T9B3  T90I  19O1>  T96"6*  T967  * C a p a c i t y r e f e r s here to the volume of lumber a m i l l Source: Derived from annual s t a t i s t i c s  T9615  T9T9  ^970  T9T1  can produce i n an 8 hour  1972  T973  shift.  of the B.C. F o r e s t S e r v i c e Reports, o p . c i t .  00 o  31 smaller  second  both  which  the  of  generation decreased  advantage  of  smaller  Spruce,  Lodgepole  trees  logging be  and  diameter Pine,  the  i n much o f  harvested  in less  Vertical the  and  plants  veneer  these in  the  for  sawmilling  and  some  residue  veneer  production  leaves  the  exception  of  converts within  the  the  into  pulp  Forest  leave As  the  with  highly  to  the  will  of  one  the  to  White  diameter  of  mechanized timber  in  could  further  paper pulp higher  and  and  other  expect  follow  the  coast  the  coast  more  that  so  have  of  Co.  products  more  thus  pulp  recently  of  had  pulp  with  the which  common pulp  to  processing  of  on  the  few the  of to  coast.  years, pulp more  plywood  some  from  the  is  creating  and  than  a  chips  mill  it  further  and  industry,  are  unprocessed  within  sawmilling  producers,  of  paper that  Most  Paper  sell  percentage  unsuitable  corewood  Although  to  utilization  as  of  sawmills  manufacturing  products. industry  and  the  plywood  the  mills  bolts  in  and  Roundwood  pulping.  Pulp  mills with  pulp  The  form,  the  Spruce,  more  supply  another. to  any  paper  road  processed  on  in  Together  a  efficient  counterparts  a  9).  George  analysts  region  had  designed  accelerated  and  used  without Prince  industry  mills.  also  newsprint  mills  been  highly  that  pulp  system  the  is  industry  interior  a  from  provincial  there  of  directly  pulp  markets,  so  quality,  industry  The s m a l l e r  permitted  the  sent  are  the  its  of  complement  region  interior  Englemann  interior  Figure  formed  is  lesser  time.  (see  mills  as  terrain  a  w h i c h had  such  central  of  The  F i r , and B a l s a m .  construction  operations  which  logs  integration  1960's w i t h  wood  equipment  gentler the  and  production.  much n e w e r  process  the  timber  mills  their  the will jobs. are older  extensively  32  Mill Type & Daily Capacity •  10-20  •  21-50  O  51-100  Q  Sawmills CMBJJ  0  101-500  40 i  80 _1_ Miles  120 I  160 I  FIGURE 9.  over 500  MILL LOCATIONS AND DALY CAPACITIES / \ Pulp & Paper •  (Tons)  P l y w o o d CThousand  IN THE CENTRAL INTERIOR OF B.C. - 1973  33  update  their  maintain  a  operations. relatively  Thus,  interior  competitive  mills  position  on  are  able  world  to  markets  d e s p i t e the o f t e n longer t r a n s p o r t a t i o n d i s t a n c e s . The  present  locational  pattern  of the i n d u s t r y has  had  a  s i g n i f i c a n t e f f e c t upon the development of c e n t e r s i n the r e g i o n . Those communities c o n t a i n i n g the h e a v i e s t c o n c e n t r a t i o n of f o r e s t r e l a t e d a c t i v i t y have grown s t e a d i l y Prince  George,  Quesnel, W i l l i a m s  Burns Lake a r e a .  i n p o p u l a t i o n , most  Lake,  and  notably  the Vanderhoof  to  In terms of a b s o l u t e numbers, P r i n c e George i s  by f a r the dominant center as a r e s u l t of the l a r g e labour f o r c e employed  i n i t s numerous sawmills  employment  has  stimulated  industries,  particularly  fabrication,  assembly,  and  hundreds  three  mills.  This  in related  service  t r a n s p o r t a t i o n , machining, and  product  and  of jobs  pulp  repair.  As  will  be  discussed  in  Chapter 3 , the number of i n d i r e c t jobs which t h i s employment has induced  i s even g r e a t e r than  i n the i n d u s t r y .  Houston  complexes early  other communities, Houston and MacKenzie,  i s the  site  of  one  of  the  largest  i n the p r o v i n c e , a p r o j e c t which was  1970's.  employed  l a r g e p o p u l a t i o n i n c r e a s e s s i n c e 1 9 6 6 (see Table  have experienced II).  Two  the labour f o r c e d i r e c t l y  Capable of producing  i n excess  sawmilling  completed i n the of 6 0 0 M.B.F. of  lumber per day, the o p e r a t i o n has c r e a t e d hundreds of d i r e c t jobs and boosted population  the s e r v i c e i n d u s t r i e s , between  1 9 6 6 and  1971.  h e l p i n g to t r i p l e MacKenzie  i s of  i n t e r e s t because i t provides a r a r e modern example of a in  the  province  created  specifically  by  and  Houston's particular community  f o r the  forest  industry. The D i s t r i c t  of MacKenzie,  i n c o r p o r a t e d i n 1 9 6 6 , was  built  34  as  a  joint  accomodate  venture  two  pulp  by  three  mills  and  forest  product  several  sawmills  companies  to  on the edge of  15 W i l l i s t o n Lake. far  as F o r t  The B.C.R., which had c o n s t r u c t e d  S t . John  i n 1958,  built  a 23  mile  i t s l i n e as  extension  into  MacKenzie f o r the movement of pulp and lumber to e i t h e r Vancouver or  120 miles  Unique  to  south  the  to P r i n c e George  region  f o r t r a n s f e r to the C.N.R.  i s MacKenzie's  heavy  useage  of  water  t r a n s p o r t on W i l l i s t o n Lake f o r the shipment of a p o r t i o n of the timber  cut north  worth  mentioning  company  town  but  of  the community.  in detail also  not  The  only  because  MacKenzie  because  i t indicates  project i s  i t is a that  modern  the c e n t r a l  i n t e r i o r f o r e s t i n d u s t r y has not reached a " p l a t e a u " i n terms of possible forest part  f u t u r e development.  product of  the  region  necessarily population in  indicates  centers. i s B.C.  coastal  This forest  tied  Forest prior  points product  to  now  that  relative  the  interior.  central  interior,  development  other  to  development  present  it  Products,  mill  the  coastal  has  possibilities  a major  to i t s involvement growing  companies  development to  that  in  production  Given been  present  suggested  involve  the  amongst  new  is  some for  the  decline  conditions  i n the  by  on  regions  analysts  construction  p r o c e s s i n g f a c i l i t i e s i n or near e x i s t i n g communities.  St.  employer  i n the c e n t r a l  1  development  and  company on the  interest  seeking  i s not  sites  As w e l l , the l a r g e s t producer and  f o r many years  interior.  the d e c i s i o n by the  to l o c a t e i n a p r e v i o u s l y undeveloped  inextricably  MacKenzie  coast  companies  For example,  of  that wood  fi  However,  i n the S t u a r t and Takla Lakes area northwest of F o r t  James may  be s t i m u l a t e d  i f and  when the B.C.R.  continues  35 with  the  construction  Driftwood, future  its  north-west of  consideration  given  to  the  i t will  by  the  industry  of  the  central  a  few  communities,  centers  of  forest and  established, particular  forest  interior  most  of  has  force.  and  Once  smaller much  who  greater  i f such the and,  developed  the  into  a  m i l l s have grouped  thus  and  production  important  concentrating  the  l o c a t i o n a l pattern  processing  located  so  system.  was  operations, as  to  in  maximize  i n t e g r a l part  The s m a l l , independent  s t a r t e d the i n d u s t r y were g r a d u a l l y taken over by a  number  economic  industry  economy o f  historically  the  wood  plywood,  The  them  activity,  more advanced  pulping  of the wood supply  Any  been to demonstrate how  on the c o a s t .  related  labour  the  the  b e n e f i t s from economies of s c a l e , thus becoming an  operators  James.  c e n t r a l i z e d system i n much the same manner  p r e v i o u s l y occurred  population  boost  at  community.  purpose of t h i s chapter has  h i g h l y i n t e g r a t e d and  into  Fort St.  stops  through the c r e a t i o n of hundreds of jobs  perhaps, the l o c a t i n g of a new The  area  presently  e n t a i l s more than adequate t r a n s p o r t a t i o n but  region considerably  as had  which  miles  development does take p l a c e ,  forest  line  150  obviously  about  of  of  large  scale.  development  companies  The in  result the  capable has  region  of  been has  involvement that  much  involved  the  at  of  a  the  forest  i n d u s t r y and c r e a t e d a dependence i n many of the communities upon this  s i n g l e resource.  Thus, a s i t u a t i o n has  evolved  where  the  economy of the c e n t r a l i n t e r i o r i s h e a v i l y t i e d i n t o the s t a t e of the  f o r e s t i n d u s t r y and  either  v o l u n t a r i l y or  interrelationship  any  as  between  a  f u t u r e d i r e c t i o n which i t may r e s u l t of the  forest  market  conditions.  industry  and  the  take, This centers  36 that i t dominates forms the t o p i c of Chapter 3>  37 CHAPTER 2 Footnotes 1.  M.B.F. i s a term commonly used denote one thousand board f e e t .  2.  Walter G. Hardwick, Geography of the F o r e s t Industry of C o a s t a l B r i t i s h Columbia ( O c c a s i o n a l Papers i n Geography, No. 5, Canadian Association of Geographers, B.C. Division, Department of Geography, U n i v e r s i t y of B r i t i s h Columbia,  i n the  forest  industry  to  1963).  3.  Joseph C o l l i n s Lawrence, Markets and C a p i t a l ; A H i s t o r y of the Lumber Industry of" British Columbia (1778-1952) (Unpublished M.A. T h e s i s , Department of H i s t o r y , U n i v e r s i t y of B r i t i s h Columbia, September, 1957), pp. 54-55.  4.  J.H. Kenney, A Regional Survey of the Hazelton-Vanderhoof, B.C. Area (Graduating Essay, Department of Geography, U n i v e r s i t y o f B r i t i s h Columbia, 1948), p. 63.  5.  James F. Gilmour, The F o r e s t Industry as a Determinant of Settlement i n B r i t i s h Columbia; The Case f o r I n t e g r a t i o n Through Regional P l a n n i n g (Unpublished M.Sc. T h e s i s , School of Community and Regional P l a n n i n g , U n i v e r s i t y of B r i t i s h Columbia, A p r i l , 1965), p. 104.  6.  For a d e t a i l e d h i s t o r y of s e t t l e m e n t i n the Nechako R i v e r s area, see Kenney, o p . c i t .  7.  A thorough account of the development of the P.G.E. i s contained i n Paul E. Gamble, The B r i t i s h Columbia Railway and Regional Development (Unpublished M.A. T h e s i s , School of Community and Regional P l a n n i n g , U n i v e r s i t y of British Columbia, A p r i l , 1972).  8.  Data on the m i l l l o c a t i o n s and s i z e s were taken from The "ABC" B r i t i s h Columbia Lumber Trade D i r e c t o r y and Year Book (Vancouver, Progress P u b l i s h i n g Company).  9.  F.D. M u l h o l l a n d , The ( V i c t o r i a : Department p. 108.  Bulkley  and  F o r e s t Resources of B r i t i s h Columbia of Lands, B.C. F o r e s t S e r v i c e , 1937),  10. The Grand Trunk P a c i f i c Railway was taken over by Canadian N a t i o n a l Railway s h o r t l y a f t e r World War One.  the  11. Doreen K. M u l l i n s , Changes i n L o c a t i o n and S t r u c t u r e i n the F o r e s t Industry of North C e n t r a l B r i t i s h Columbia, 1909-1966" (Unpublished M.A. Thesis, Department of Geography, U n i v e r s i t y of B r i t i s h Columbia, September, 1967). 12. Gamble, o p . c i t . , p.  46.  JL  38  13.  I b i d . , p. 5 8 .  1 4 . From statements made i n George, February, 1 9 7 8 .  a  personal  interview  in  Prince  1 5 . MacKenzie I n d u s t r i a l , Community, and Commercial Survey (Prince George: F r a s e r - F o r t George Regional Development Commission, March, 1 9 7 7 ) . 16.  The C e n t r a l Report - 7 6 ( V i c t o r i a : Department of Economic Development, Government of B r i t i s h Columbia, 1 9 7 6 ) , pp. 4 0 48.  39  CHAPTER 3 ECONOMIC  BASE  ANALYSIS  AND  ITS  APPLICATION  TO  THE  CENTRAL  INTERIOR REGION  Having industry  demonstrated  has  interior's and  i n the previous chapter how  historically  economic  dominated  development, the  q u a n t i f y t h i s dependency.  measurement  purporting  developed  urban  by  to  and  much  of  intent  accomplish  regional  this  analysts,  the  here  A wide v a r i e t y  the  forest central  i s to analyze  of techniques task  have  beginning  of  been  with  some  i  simple  attempts  nonbasic  ratios  subsequently such  by  methods  been v a s t l y  world"  J  and of  Hoyt  cities.  refined  and  sophisticated  econometric  analysis  have  1930's  i n the  i n American  relatively  analysis  H.  The  early  basic-  methods  have  expanded upon to encompass  techniques  modelling. been  to q u a n t i f y  widely  as  While advocated  input-output these as  advanced  more  "real  and a c c u r a t e i n t h e i r r e s u l t s , they are not a p p l i c a b l e to  a l l r e g i o n s or s i t u a t i o n s , p a r t i c u l a r l y because of t h e i r need f o r l a r g e q u a n t i t i e s of r e l a t i v e l y d e t a i l e d data. When i n i t i a l l y g a t h e r i n g i n f o r m a t i o n f o r t h i s p o r t i o n of the thesis,  i t became evident that  i f a method of a n a l y s i s such  as  input-output was to be used, c o n s i d e r a b l y more economic data were required  on  firm  the  approach  Discussions companies,  communities  and  forest  i n d u s t r y of the  central  A t r i p was made by the author to the r e g i o n i n 1 9 7 7 to  interior. ascertain  the  feasibility and/or  with  of g a t h e r i n g data  unpublished  officials  the Northern  of  Interior  local several  through  government large  a  statistics.  forest  C o u n c i l of F o r e s t  firm-by-  product  Industries,  40 the  Regional  Prince  District  George  available  of  Fraser-Fort  indicated  beyond  that  S t a t i s t i c s Canada.  that  there  already  necessary to  Furthermore, i t was  to  the  centers.  although  criticism  it  is  a  economic  sources  suggested  the  three The  of data  such  as  that a firm-byand  from some of the  of  three  trip the  did  allow  region's  towns not  the  thirteen  visited  were,  Valemount.  constraints  Economic Base A n a l y s i s was study  by  City  time-consuming undertaking  data,  a l l but  F o r t S t . James, McBride, and Given  little  the  Despite the u n s u c c e s s f u l attempt  economic  visit  population  and  l i k e l i h o o d of c o o p e r a t i o n  further  opportunity largest  little  information sources.  gather  was  published  f i r m survey would be an extremely that there was  George,  of  time  chosen as form  from some a n a l y s t s .  of Two  and  data  availability,  most a p p r o p r i a t e  analysis  prone  for  to  this  continued  forms of E.B.A., the L o c a t i o n  Quotient method and the Minimum Requirements technique, have been applied  i n an attempt to i n c r e a s e the degree of accuracy  a n a l y s i s and  results.  weaknesses, thus  literature  Economic  Base  E.B.A.  and to  interior.  i t s own  i t i s necessary  existing  presents  Each has  and  The  the  p a r t i c u l a r strengths  and  to begin  relevant  Analysis.  of  with  empirical  latter  a review  research  portion  of  force  T h i s chapter  data  on  communities  in  the  involving  the  d i s c u s s e s the r e s u l t s of a p p l y i n g the two  labour  of  the  chapter forms of central  i s t h e r e f o r e intended not only to provide  a b e t t e r understanding  of some of the i n t e r r e l a t i o n s h i p s between  the  and  forest  contribute approach.  industry to  the  the  empirical  regional research  economy utilizing  but the  also  to  E.B.A.  41 3.1 A Review o f Economic Base A n a l y s i s Essentially, community's services  economic  which  boundaries. community  the  economic  growth  base  theory  states  comes from the export of goods  i t produces  locally  but  sells  outside  and  the  forest industry.  the  community  that  i s termed the b a s i c  sector,  in this  supply goods and s e r v i c e s  for local  the process  from one  In the l a t t e r ,  boundaries and  no  u s u a l l y be at a r e l a t i v e l y This  would  being  be e s p e c i a l l y  investigated  highly  simplified  which  trade  while  exists  takes  on a  place  development  may  within s a l e or  Obviously,  or r e g i o n  subsistence  outside occur,  slower r a t e than i f trade t r u e at the l o c a l  here.  case  A key phrase here i s "economic  growth" because t h i s i s what d i s t i n g u i s h e s a community  area's  and  of i t s  The r e s t of the business a c t i v i t i e s  use are r e f e r r e d to as nonbasic.  economy.  a  T h i s c r e a t e s the income upon which the r e s t of the  depends  undergoing  that  of the  i t would occurred.  and r e g i o n a l  the theory  view of an urban or r e g i o n a l  levels  i s based  on  a  economic system  and i t ignores c e r t a i n important and observable economic  factors.  However, i t serves as a u s e f u l base upon which many models  have  been f a s h i o n e d , i n c l u d i n g the widely u t i l i z e d Lowry model. While the b a s i c - n o n b a s i c e a r l y as 1921  and f i r s t  concept was  vaguely recognized as  a p p l i e d to a s p e c i f i c c i t y i n 1932 by R.  Hartshorne i n h i s study of M i n n e a p o l i s - S t . P a u l , ^ advancement 7 the  methodology  measuring  basic  i s credited activity  l a c k of a b e t t e r t i t l e . people  employed  national  which  to  was  He proposed a method f o r termed  h i s " s i x steps" f o r  I t i n v o l v e d comparing the percentage of  i n various  percentage  to Hoyt.  of  activities  determine  i n a community  which  activities  with had  the more  42 workers excess the  at  the  local  employment  level  was  than  considered  the  national  averages.  to be the b a s i c  The  employment of  community and whatever i t was that they produced was taken as  goods  or s e r v i c e s  destined  f o r export.  I t i s from t h i s  early  work by Hoyt that the L o c a t i o n Quotient method d i s c u s s e d l a t e r i n t h i s chapter was any  detail  derived.  the concept of b a s i c - n o n b a s i c  because of l i m i t e d ratio  to  be  research,  Hoyt was a l s o the f i r s t  1:1  data and  Hoyt's  initial  the r a t i o interest  ratios.  Originally,  he assumed the employment  for a l l centers.  he concluded that  community.  testing,  to examine i n  Through  later  actually  varied  i n the  empirical  economic  f o r each base  through h i s work with the F e d e r a l Housing A d m i n i s t r a t i o n  was  i n the  United S t a t e s where he found the method u s e f u l as an i n d i c a t o r of local  housing market demand.  greater a p p l i c a t i o n s . the  economic  base  R.  idea  He soon r e a l i z e d  that  i t had even  Andrews s t a t e s t h a t , "Hoyt considered  to be a t o o l  that  might  be employed  in  a n a l y z i n g the economic background of c i t i e s with the o b j e c t i v e of Q  f o r e c a s t i n g the f u t u r e of the e n t i r e The American  1940's cities.  produced Some  dozens  concept.  of  followed  measurement, but many provided However, academic  city." economic  the  new  base  existing  ideas on how  interest  i n methodology  on  techniques  of  to u t i l i z e  i n the s u b j e c t  have receded i f judged by the number of r e l e v a n t many of the advances  studies  appears to  articles,  went l a r g e l y  the  thus  unpublicized.  q  The s e r i e s renewed J. how  of a r t i c l e s  by Andrews  i n the e a r l y  1950's sparked  i n t e r e s t , p a r t i c u l a r l y amongst geographers. Alexander p u b l i s h e d  geographers could  best  a 1954  paper  approach  i n which  economic  base  he suggested theory.  He  43 states,  "This concept  has  merit  f o r urban geography  c l a s s i f i e s economic base f u n c t i o n s fundamentally  because i t  on the b a s i s of  s p a c e - r e l a t i o n s h i p s , i t r e v e a l s one group of economic t i e s which bind  a city  to other  comparative  analysis  additional  of  i t permits  10  paper, Alexander nonbasic  a classification  settlements,  method of c l a s s i f y i n g  within a c i t y . "  of  areas,  and  individual  it  of  and  provides  an  economic  ' From an e m p i r i c a l study presented found  activities i n the same  t h a t as a community grows, i t s p r o p o r t i o n  employment  grows  as  well.  There  were  also  i n d i c a t i o n s that a somewhat constant r e l a t i o n s h i p e x i s t s between the s i z e of the labour f o r c e and it  supports.  I f such  the s i z e of the p o p u l a t i o n which  relationships  can  be  shown to e x i s t  for  communities i n the c e n t r a l i n t e r i o r , they c o u l d be b e n e f i c i a l  as  a  or  planning  decreases  tool in  population Alexander study, type  the  and raised  forest  center,  with the s i z e and Given  the  to  understand  how  labour  force  related in  the  rest  some questions which he does  settlement, to  helping  employment  including:  of  center  in  the  are  and  of  felt  basic-nonbasic  the  does  nonbasic the  increases  the  vary  activities ratio  of  this  chapter  and  a v a i l a b l e f o r E.B.A., there are e s s e n t i a l l y  the  further with  similar vary  type but a l s o with the l o c a t i o n of intent  upon  community.  warranted  ratio  employment  impact  not  the from only  settlement?  type  of  data  three techniques  of  measurement which could be p o t e n t i a l l y u t i l i z e d - the Assumptions Approach,  the  Requirements techniques  Location  technique.  r a t h e r than  Quotient The  the  method,  d e c i s i o n to  Assumptions  the f o l l o w i n g three s e c t i o n s .  and  apply  Approach  the the  Minimum  latter  two  i s outlined in  44 3.2 The Assumptions Approach In and  the Assumptions  commercial  activities,  f i r m s a r e assumed  others  the remainder  Approach  industries  to be wholly  employment  a r e c o n s i d e r e d wholly  a r e a combination  The major problem  to E.B.A., c e r t a i n basic  service  o r i e n t e d , and  or "mix" of b a s i c  and nonbasic.  i s i n determining how each economic a c t i v i t y i s 11  to be c a t e g o r i z e d . Wichita,  Kansas  W. I s a r d 12 study  makes e x t e n s i v e mention of a 1952 as  an  empirical  example  of  the  Assumptions Approach and i t serves to e x p l a i n why the technique is  not a p p r o p r i a t e  for application  communities i n the c e n t r a l  to employment  data  on the  interior.  The W i c h i t a study presented employment data broken down i n t o twenty-one economic a c t i v i t i e s , of manufacturing.  This  including  eleven s u b - c a t e g o r i e s  i s i n c o n t r a s t to the employment  a v a i l a b l e f o r use i n t h i s study which a r e broken twelve To  sectors,  including  aid in allocating  just  one category  employment  data  down i n t o only  f o r manufacturing.  to wholly  basic  or  non-basic  status,  the W i c h i t a study was able to make use of " . . . a v a i l a b l e 13 e m p i r i c a l data on s a l e s , markets, e t c . " To determine the b a s i c - n o n b a s i c r a t i o f o r mixed i n d u s t r i e s , the L o c a t i o n Quotient 14 J  technique was a p p l i e d . of  the S t a t i s t i c s  Wichita  study  empirical twelve  Canada  and that  evidence  data  there  unsuitable.  i t i s obvious Hence,  Requirement  i s much  exists  to suggest  industrial activities  nonbasic,  Minimum  Given that the l e v e l of d i s a g g r e g r a t i o n less  a dearth  than  that  either technique  the  will  Assumptions  have  s e c t o r of the  as e n t i r e l y  the L o c a t i o n  of the  of comprehensive  that any p a r t i c u l a r can be viewed  that  b a s i c or  Approach  Quotient  method  to be r e l i e d  is or  upon to  45 determine the r a t i o . 3.3 The L o c a t i o n  Quotient Method 15  The L o c a t i o n  Quotient formula, as given by C. Tiebout  x  for x  who  i s considered  export  and thus  the economic base,  of other  communities i n the country  have s i m i l a r demands. cultural  differences  However,  exist  between  i f , f o r example, B.C.  national  figures  metropolitan population, employment forest  I t i s obvious  were  areas,  used,  some  employment the  studied  i n that  i t will  strong  economic and  regions  data would s t r o n g l y labour  force,  reflect thus  of  Canada.  figures rather  Vancouver  influence.  those  being  and  with approximately t h r e e - q u a r t e r s  would exert a strong  industry  that  by  Requirements  The method assumes that the community  typical  industry  Quotient  particularly  a n a l y s t s who have chosen i n s t e a d to use the Minimum  is  be  becomes  has been l e v e l e d a t the L o c a t i o n  of examining  technique.  would  sector.  Strong c r i t i c i s m method  of people  I f the a c t u a l employment i n that  the r e s i d u a l  p a r t of the b a s i c  the number  employment  i n the community i f i t had j u s t enough to  i t s own needs.  exceeds x,  total national  yields  employed i n i n d u s t r y i supply  i  n a t i o n a l employment i n i n d u s t r y  t o t a l l o c a l employment " Solving  is:  than  Victoria of B.C.'s  As w e l l , p r o v i n c i a l  the high  numbers  the number  i n the  calculated  as  r e q u i r e d a t the l o c a l l e v e l to meet the demands of the community (nonbasic  employment)  course, even when using method  assumes  would  be  f a r i n excess  of r e a l i t y .  Of  the n a t i o n a l l e v e l as the benchmark, the  self-sufficiency  when  in fact  trade  i s taking  H6  place  with other c o u n t r i e s .  T h i s i s a problem  no  matter  what  benchmark i s used and, as Yeates and Garner s t a t e , " U l t i m a t e l y i f 1 ft the world i s taken as u n i t then a l l a c t i v i t i e s are nonbasic." Productivity critics. the  per  employee  It i s possible  national  average,  that  most  applicable  virtually  productivity central any,  in  impossible  the  Such  to  concern  m e t r o p o l i t a n or p r o v i n c i a l  of  ratios  employees  than  should  percentages based  Leigh  such  the  size  of  seem  to  basic  the  sector,  case.  calculate  of  constitute  thus  versus L.Q.  the  variation exists of  in  i n the  little,  centers valid  if  being  at  the  the  creating  higher  compared  export  derived figures  In every case the  for basic  percentage  industries.  employment.  identify  the economic base of  of He  sales  outside  then c a l c u l a t e d  method and data from the  Production.  q u o t i e n t s do not c l e a r l y  is  L.Q. R.  of u n d e r e s t i m a t i o n i n h i s study of  the r e s u l t s would be u s i n g the L.Q. Census  more  It  1  He obtained data from which he was  Vancouver area f o r f i f t e e n  Canadian  the  Tiebout  below the survey f i g u r e  accurately  should  tends to underestimate  on survey r e s u l t s  economy.  a  seem to be  would  d i s c u s s e s the problem 18  Vancouver's  i s above  employment  industry.  f o r s i x l a r g e c i t i e s i n the United S t a t e s . estimate was  of  level.  i n the be  the  or communities  I t has been found that the L.Q. number  a community  if  i t would of  concern  Tiebout notes that t h i s c r i t i c i s m 17  ascertain  because a  from  another  manufacturing  However,  significance  analyzed.  output  between manufacturers  interior.  been  t h e r e f o r e more of  belong to the export category. is  has  Leigh  concluded,  city.  For  these  the what 1958  "Location  or rank those i n d u s t r i e s the  able  that  reasons,  47  estimates tend  of basic  employment  to be underestimates  derived  from  ( i n comparison  location to s a l e s  quotients proportion  based e s t i m a t e s ) and the b a s i c - n o n b a s i c employment r a t i o s  based  1 9  on them would be m i s l e a d i n g . "  In defense of the method, i t can  be argued that i f indeed L.Q. produced estimates a r e i n a c c u r a t e , it  should  be  to  approximately  T h e r e f o r e , they can s t i l l are  still  the  same  degree  f o r each.  be used to t e s t most r e l a t i o n s h i p s and  a c c e p t a b l e when used i n r e l a t i v e  comparisons.  20 E. Ullman e t a l . on  the  topic  underestimate example, sector  exports,  both  from  practically  i n the country,  f o r average  always  Thus,  internal  will  the L.Q.  this  city  measuring  tends  to  i n a given  average needs  includes  and  average will  produce a s m a l l e r export than measuring  from  of excess result.  above  from  For  the average  I f an excess above  (instead  Since  i t overestimates the m u l t i p l i e r .  a city.  minimum.  multiplier  accuracy.  has the same percentage employed  as the average  exports  export  L.Q.  i f a city  production  the  of  provide further discussion of relevance  the average  i s taken as the  the minimum),  Ullman  noted  that  a much higher this  would  be  p a r t i c u l a r l y t r u e the g r e a t e r the degree o f a g g r e g a t i o n ( i e . the l e s s the breakdown of i n d u s t r i a l  categories).  An advantage of the L.Q. i s that i t i s capable of measuring i n d i r e c t as w e l l as d i r e c t exports. produces  a  semi-finished  good  which  For example, i t then  i f an i n d u s t r y  sells  locally  to  another i n d u s t r y which uses i t to produce a f i n i s h e d product f o r export, the L.Q. method w i l l i n d i c a t e both goods as export r a t h e r than j u s t the l a t t e r . the  forest  T h i s i s p a r t i c u l a r l y r e l e v a n t i n examining  i n d u s t r y where a p i e c e of timber may undergo  several  48 stages or more of p r o c e s s i n g by  different  manufacturers  in i t s  journey from the woods to market. 3.4  The Minimum Requirements  Technique  The Minimum Requirements technique of measuring base  has  been  favoured  by  some  analysts  method, i t c o n t a i n s some weaknesses.  but,  the economic  like  A succinct  the  L.Q.  definition  of  21 the technique i s provided by T i e b o u t .  For each community, the  percentage of the t o t a l labour f o r c e employed i n each i n d u s t r y i s calculated.  The percentages f o r a given i n d u s t r y are then ranked  i n d e c r e a s i n g order of magnitude. the communities  f o r the  The  lowest percentage  i n d u s t r y i s presumed to be  r e q u i r e d to s a t i s f y the community's needs.  of a l l  the minimum  A l l other employment  i s c o n s i d e r e d export and t h e r e f o r e b a s i c . 22 H. Brodsky and D. S a r f a t y ,  as w e l l as p o i n t i n g out some of  the p r e v i o u s l y d i s c u s s e d problems with the L.Q. the  M.R.  technique  because  i t i s derived  method, advance  from  central  place  theory and i s l o g i c a l l y grounded i n the concept of urban economic thresholds.  However,  technique... the defects,  perhaps  they  minimum  do  allow  requirements  that,  "As  an  indirect  method  is  not  without  the most s e r i o u s of which  i s that  a l l cities  w i t h i n the same p o p u l a t i o n range are regarded as having i d e n t i c a l 2? nonbasic components." In reality, variations in local J  consumption, nonbasic  d i s t a n c e from  competing  centers a f f e c t  activity.  Ullman reliable  income, and  et  a l . defend  indicator,  the  although  approach no  more  as than  "...a an  surprisingly approximation,  a n d . . . i t i s the best s h o r t cut method f o r e s t i m a t i n g , e s p e c i a l l y 24 f o r aggregate groupings." Using the M.R. approach, they found  49 that the l a r g e r a c i t y , that confirms one For  a town of  was  calculated  ratio  was  are  to  be  and  1:0.5.  For  i t climbed  These r a t i o s are  lower  than  investigated  those  by  i t i s , a finding  of the b a s i c premises of c e n t r a l p l a c e  10,000 persons, the  1:1  millions.  the more s e l f contained  to  nonbasic  a population  to  over  1:2  of  for  studies  for  much  discussed  employment  250,000,  cities  somewhat q u e s t i o n a b l e  calculated  the  basic  the  the  in  i n that  smaller  in  theory.  the they  communities  section  which  follows. In  defense  of  the  L.Q.  approach  compared  to  the  technique, Ullman et a l . observed that the method could awkward  when  especially  applied  to  i n a small  minor  industry  might  still  s e l l s most or  i n d i v i d u a l , disaggregated  be  Minimum Requirement  be  be  a l l of  to  i t s output  zero  yet  locally.  less  industries,  town where the expected  M.R.  the  They  for a  industry  concluded,  "At b e s t , . . . a t  extreme d i s a g g r e g a t i o n , . . . i t i s about a s t a n d o f f -  the  quotient  location  average...,  or  suffers  conversely,  the  from  measuring  minimum may  an  provide  irrelevant a false  low  2S minimum." the  L.Q.  They f e l t  that the M.R.  technique was  superior  approach because the minimum g i v e s more n e a r l y  f i g u r e while the L.Q. A consistent  a gross  gives a net f i g u r e .  criticism  t a k i n g the minimum can  to  of the M.R.  technique has  been that  o f t e n r e s u l t i n " f l u k e s " so that some of  the minimums determined to be necessary to s a t i s f y the needs of a community should  be  in the  various case.  industrial G.  sectors  Alexandersson  are and  much I.  lower  Morrissett '  attempted i n separate s t u d i e s to get around t h i s problem by the  than  5 p e r c e n t i l e (K f a c t o r ) , an approach which drops the  using bottom  50 one  or  more  minimums  requirements. there the  are  from  Ullman and  equally  the  M.  Dacey  good reasons  with fewer i n d u s t r i a l s e c t o r s . the  of  responded by  f o r being  a c t u a l minimum, e s p e c i a l l y at  becomes f i n e r ,  calculation  the  arguing  consistent  higher  and  l e v e l s of  Ullman  standard  Dacey's  but  argument,  the  K  that f o r  that i s h i g h l y c r i t i c a l  the  necessary.  factor  p r a c t i c e i n most a p p l i c a t i o n s of the M.R.  In an a r t i c l e  taking  They admit that as the breakdown  chances of f l u k e s i n c r e a s e s  and  that  aggregation  14 i n d u s t r i a l types which they used, a K f a c t o r i s not Despite  mimimum  has  become  'technique.  of the M.R.  approach,  29 R.  Pratt  technique  summarizes is inferior  his to  the  discussion L.Q.  by  method  stating  because  that  the  averages  are  more meaningful then minimums, both techniques r e q u i r e  the  assumptions, and  M.R.  improper  disaggregation.  P r a t t ' s c r i t i c i s m s served  arguments f o r and but best  i s subject  against  Ullman, Dacey and  to g r e a t e r  e r r o r from  same  only to spark f u r t h e r  both methods of Economic Base A n a l y s i s  Brodsky provide  what would seem to be  the  compromise: " I t might be argued t h a t , j u s t as the l o c a t i o n  quotient,  or n a t i o n a l average approach,  component,  since  i t would  include  gives  too  high  average exports,  the  a  local  minimum  would give too low a l o c a l f i g u r e , because some of the employment or production above the minimum could represent production f o r the l o c a l market (import substitution). Thus, some f i g u r e between  the  minimum  and  the  average  ( l o c a t i o n quotient)  might  30 give  a better  general  measure."  mind that the d e c i s i o n was and  I t i s with  this  thought  in  made to use both the L o c a t i o n Quotient  Minimum Requirements methods of E.B.A. i n the a n a l y s i s which  f o l l o w s the next s e c t i o n .  51 3.5  Empirical  Economic  Base  Analysis  Involving  the  Forest  Industry Various the  last  forms of E.B.A. have been u t i l i z e d  t e n to f i f t e e n  analyzing  the  communities  years  economic  or r e g i o n s  i n studies  impact  of  i n both  the  that  have  forest  the United  Most o f the s t u d i e s have r e l i e d  extensively i n involved  industry  States  on  and Canada.  upon employment data as opposed  to income or p r o d u c t i o n f i g u r e s because the former are g e n e r a l l y more r e a d i l y o b t a i n a b l e and allow g r e a t e r ease i n c a l c u l a t i o n of basic-nonbasic findings they  ratios  and  and c o n c l u s i o n s  multipliers.  o f these  studies  Discussion  o f the  i s important  because  provide a u s e f u l comparison i n determining  E.B.A. d e r i v e d  ratios  and m u l t i p l i e r s  the accuracy of  f o r communities  in this  thesis. 31 A 1969 study on a l l aspects of the O n t a r i o f o r e s t industry-^ devoted impact  considerable  to a d i s c u s s i o n o f the employment  of the i n d u s t r y .  communities, considered related  space  Dryden,  typical  activity.  An  analysis  Kapuskasing,  of centers The study  town i n c r e a s e s , the basic-nonbasic indication The  that  finding  resource  also  self-sufficiency confirms  and  with  found  was  made  Hearst,  a large  amount  using  three  which  were  of f o r e s t -  that as the remoteness of a ratio  would  tends also  the w i d e l y - h e l d  to decrease,  tend  to  belief  an  decrease.  that  remote  based communities a r e l a c k i n g i n many of the goods and  s e r v i c e s which would help to c r e a t e a more s t a b l e labour f o r c e . A l o c a l community m u l t i p l i e r of 2 ( i e . , a r a t i o o f 1:1) was found by  the study  figure.  to be f u l l y  justified  The r e p o r t s t a t e s , "...both  and i n f a c t theory  a conservative  and e m p i r i c a l work  52 i n d i c a t e s that a m u l t i p l i e r as high as 2.5 assumed  for  whether  in  basic  employment  the  forest  manufacturing and  Ontario  i n Southern  industry  or  Ontario  in  service  communities,  related  secondary  J  on Manitoba's wood-using i n d u s t r y  employment m u l t i p l i e r s based upon the r e s u l t s of  report.  The  be  32 industry."  A Canadian study i n 1972 calculated  or even more could  Manitoba  study  was  able  to  J  the  determine  m u l t i p l i e r s f o r s e v e r a l d i f f e r e n t s e c t o r s of the f o r e s t i n d u s t r y although  the  figures  are  multiplier  was  for  sawmilling  was  slightly  explain  the  multiplier generally sawmill. the  the  The  reason  i n much  provincial scale.  and  lower  i t i s most  located  a  pulp  possible  but  on  paper  at  2.  for  likely larger  industry No  a  at  attempt  higher  because  industry  than  paper  the  are  average  Pacific  have  been  Northwest  d e c l i n e of the service  transportation,  able  by  to  use  D.  Flora  more  However, the study was  equipment  J  could  especially manufacturing  the  sophisticated amounts of data  A research  used  1:1.26.  forest industry  activity,  and  measure of such an  estimated a  S t a t e s , s t u d i e s on the economic impact of  determine a b a s i c to s e r v i c e r a t i o of  non-local  and  to  1.97.  a v a i l a b l e at the r e g i o n a l or community s c a l e s .  the  made  operations  techniques of measurement because of the g r e a t e r  the  while  authors of the r e p o r t conducted a s i m i l a r study i n  In the United  that  was  same year on Saskatchewan's f o r e s t i n d u s t r y and  forest  highest  2.05  pulp  such  communities  s l i g h t l y lower p r o v i n c i a l m u l t i p l i e r of  on  The  sales  paper  data  F l o r a points have an in and  to out  e f f e c t on  wholesaling, servicing.  unable to o b t a i n an adequate q u a n t i t a t i v e  effect.  53  u s e d i n a 1968 p a p e r w h i c h  I n p u t - o u t p u t a n a l y s i s was at  Pennsylvania's  indirect of  forest  income, the  study  existed  analyzing  $1.88  by  p a r t i c u l a r county. every  industry.  dollar  of  Based  found t h a t the  a  total  export  by  In another county w i t h  goods  economic a c t i v i t y .  sold  was  export m u l t i p l i e r paper  firms  to  a  $2.24  in  et a l . s t a t e  "The  higher  because a v e r a g e income i s l o w e r i n s e r v i c e i n d u s t r i e s t h a n  logging  and  multiplier  multipliers  from  economy,  produce  t h i s study, Hedlin  employment  and  that,  in  related  direct  a sawmilling  estimated  Commenting on  on  looked  manufacturing."-^  would  be  in  the  They  order  of  be  suggest  2.26.  when compared t o a 1 9 7 0 r e p o r t  conservative  would  The on  slightly  that  such  figures  the r o l e of  a  seem forest  37 lands  in  the  compiled  from  Washington  state  input-output  economy.  tables  Income m u l t i p l i e r s  1  produced  figures  from 2 . 2  for  paper m i l l s to 4 . 1 9 f o r l o g g i n g .  However, i t must be k e p t i n m i n d  that  the  c a l c u l a t i n g m u l t i p l i e r s at  into account trade a c t i v i t y outside Therefore  i t  should  be  m u l t i p l i e r ( s ) w o u l d be A their  instead  of  the  of  income  employment  figures  output  tables  employment products 3.5  An  was  that  utilized  from  Dominion at  a  the  f u r n i t u r e ) and  K.  taking  counties.  state-level  Bureau  1.4 3.2  Runyon e t  industry.  study  provincial from  by  forest  m u l t i p l i e r s , the  m u l t i p l i e r s ranged  f o r p u l p and  w o u l d be  t h e c o m m u n i t i e s and  expected  Nova S c o t i a  available  (excluding  level  higher.  s i m i l a r methodology analysis  state  was of  However, to  derive  Statistics  input-  1960.  The  miscellaneous  wood  scale for  able  a l . in  for  for sawmilling  through  to  paper.  i n t e r e s t i n g a t t e m p t was  made t o i d e n t i f y b a s i c  employment  54 in  t h e timber  California divided  patterns.  Maki  et  areas,  employment that  growing  a l . as  i n each  into  commuting  city  i n each  The  study  fifteen  d i s t a n c e s and  o f t h e economic  p a r t o f an a r e a .  The g r o w t h c e n t e r and  form  area  an  calculated  excess  as p r o d u c i n g  by  economic  industrial  The  economic  characterized  internal  the study  sector.  categorized  being  and  on  region  Northern  as t h e growth c e n t e r s i n c e i t t y p i c a l l y i s  communities  interdependence these  essentially  and  technique.  Douglas-fir  The l a r g e s t  was i d e n t i f i e d  surrounding  county  based  t h e most r a p i d l y  Northwest  the Location Quotient  forty-one areas  shopping areas  using  a  economic  i n d u s t r y o f the P a c i f i c  described  a  high  linkages.  L.Q.'s  employment  degree  local  W. of  F o r each  by c o m p a r i n g  sector with  by  of  national  employment i n  above  the  norm  was  f o r e x p o r t m a r k e t s and t h e r e f o r e b a s i c .  T h i s method o f a n a l y s i s d e r i v e d an employment m u l t i p l i e r o f 2.26. The forest  only published study  o f r e l e v a n c e on B r i t i s h  i n d u s t r y h a s been a w i d e l y d i s t r i b u t e d  Columbia's  r e p o r t p r e p a r e d by Lin  F.L.C. report but  Reed  and A s s o c i a t e s f o r t h e B.C. F o r e s t S e r v i c e .  made a number o f a s s u m p t i o n s  i t produced  employment  e q u i v a l e n t t o those found some  o f which  "conservative"  Prince  be  to determine  community,  George  to  3,  approximately  discussed here,  For the province  to nonbasic  ratio  although  base  as a  a s 1:2 and t h e  labelled  as  a  estimate.  I n an a t t e m p t individual  i n many o f t h e a r t i c l e s  the basic  therefore  t h e economic  and m u l t i p l i e r s  t h e r e p o r t acknowledged.  w h o l e , Reed c a l c u l a t e d multiplier  ratios  concerning  The  area.  a  survey  The  t h e impact was  boundaries  o f t h e i n d u s t r y on an  conducted  by  Reed  of the survey  i n the  area  were  55 delimited  as  containing most  within all in  a  twenty  54,000 p e o p l e .  logging  logging  within  operations  employees  radius  Prince  George,  I t i s important to note that  although  l a y outside  were  the survey area.  mile  considered  from  of as  the  boundaries,  maintaining  households  A s i m i l a r a s s u m p t i o n h a s been made f o r  the communities i n the a n a l y s i s which f o l l o w s . Reed's  allied  study  was  that  i n d u s t r i e s , and  Twenty-five (other  percent  than  industrial  groups  a l l t h e wood  forest  services  o f employment  forest  most  products),  i n the s e r v i c e  Also  industries, were  basic  assumed  paper  activities.  i n a g r i c u l t u r e , manufacturing construction, sector  was  The r e s u l t s y i e l d e d a m u l t i p l i e r o f 2.43.  and  the  considered  Applying  five basic.  t h e same t y p e  o f a n a l y s i s t o an employment s u r v e y o f t h e Okanagan r e g i o n contains  the  major  forest  product  centers  of  IV  provides  a  summary  of  the  type  and  m u l t i p l i e r s c a l c u l a t e d by t h e e m p i r i c a l s t u d i e s d i s c u s s e d section. the  The t a b l e p r o v i d e s a c l e a r i n d i c a t i o n t h a t  multiplier  including  varies  the type  size of the region  depending  of data  used,  upon  a  number  the geographical  and  2.49. size  of  i n this  the s i z e of of  factors,  l o c a t i o n and  a n a l y z e d , and t h e method o f a n a l y s i s  The employment m u l t i p l i e r s r a n g e f r o m 1.4  which  Penticton  K e l o w n a , Reed p r o d u c e d an a l m o s t i d e n t i c a l m u l t i p l i e r o f Table  and  applied.  f o r m i s c e l l a n e o u s wood  products  i n Nova S c o t i a t o 3.5  Scotia.  The two employment m u l t i p l i e r s o f most r e l e v a n c e t o t h i s  study and  are those c a l c u l a t e d  2.49  f o r Prince  George.  f o r p u l p and p a p e r , a l s o  by Reed o f 3 - 0 - f o r \  British  i n Nova  Columbia  TABLE IV - SUMMARY OF MULTIPLIERS CALCULATED BY EMPIRICAL STUDIES OF THE FOREST INDUSTRY Region Pacific  Northwest  Author(s) and Year  Income  Maki et al,1968  2.26  Employment  Gamble,  1.88 - 2.24 2.26  Income Employment  H e d l i n and Menzies, 1969  2 - 2.5  Employment  Government Report, 1970  2.2 (Paper Products) 4.19 (Logging)  Income  Runyon et al,1972  1.4 (Misc. Products) 3.2 (Sawmill) 3.5 (Pulp & Paper)  Employment  B r i t i s h Columbia and P r i n c e George  Reed et a l , 1973  3 2.49  Employment Employment  Manitoba  Teskey and Smith, 1975  2 - 2.05  Employment  Saskatchewan  Teskey and Smith, 1975  1 .97  Employment  Pennsylvania Ontario  1965  Jjrpe  2.26  P a c i f i c Northwest and Northern C a l i f o r n i a  Flora,  Multiplier  1968  Washington S t a t e Nova S c o t i a  57 3.6  The  Application  of  Economic  Base  Analysis  to  the  Central  Interior The  labour f o r c e data f o r t h i s a n a l y s i s came from  Census of Canada p u b l i s h e d by S t a t i s t i c s Canada. centers but  i n the  one,  Fraser  involvement  in  because most types  central  of  interior  Lake, the  of  were  forest  identified  industry.  data  rejected  because  Of the f o u r t e e n  having  i s i n the  were  i t would  as  Fraser  not  be  -  significant  Lake  mining  available  Occupation and Labour Force by I n d u s t r y . was  1971  f o r which data were given, a l l  i t s employment  employment  the  was  omitted  sector.  Labour  Two  Force  by  O c c u p a t i o n a l employment p o s s i b l e to  identify  the  t o t a l number employed i n a given i n d u s t r i a l s e c t o r .  For example,  those  in virtually  persons  listed  as c l e r i c a l  c o u l d be employed  any business a c t i v i t y from a grocery s t o r e through paper  company.  Table  V  shows  the  to a pulp  industry divisions  and  and the  t o t a l numbers employed i n each f o r the three census d i v i s i o n s (2, 4,  and  14)  within  L.Q.'s  and  M.R.'s,  category  study  the  i n Table V was  the twelve other The  the  region.  "industry  In  calculating  unspecified  or  both  the  undefined"  assumed to be evenly d i v i d e d up amongst  industries.  b a s i c - n o n b a s i c r a t i o s which were d e r i v e d u s i n g the  method are much higher  than  should  be  expected  L.Q.  f o r communities  which range i n p o p u l a t i o n from only 658 to 33,101 (see Table V I ) . This i s p a r t i a l l y an  exporter  expected 1:1.86  and  accentuated national  by the f a c t  figures  that Canada i s i t s e l f  were used  nonbasic needs of the communities. (a m u l t i p l i e r  of 2.86)  in calculating The  the  lowest r a t i o i s  f o r MacKenzie, a community  had only been i n e x i s t e n c e f o r f i v e years p r i o r to  1971  which  and  was  TABLE V - LABOUR FORCE IN THE CENTRAL INTERIOR BY INDUSTRY FOR 1971 1.  Agriculture  1,905  2.  Forestry  3,890  3.  F i s h i n g and Trapping  4.  Mines, Quarries and O i l Wells  5.  Manufacturing*  6.  Construction  3,810  7.  T r a n s p o r t a t i o n , Communications, and U t i l i t i e s  5,365  8.  Trade  6,940  9.  Finance, Insurance and Real E s t a t e  1,410  10.  Community, Business, and Personal S e r v i c e s  45 1,215 10,080  11,535  *Includes sawmilling and pulp and paper as w e l l as m i s c e l l a n e o u s wood u s i n g i n d u s t r i e s . Source: S t a t i s t i c s Canada, 1971 Census - Experienced Labour Force by I n d u s t r y (Cat. 94-780)  CO  59 still  developing  i t s nonbasic  ratio  is  for  1:7.02  second l a r g e s t r a t i o but  George,  The  the  The  largest  s e t t l e m e n t , Quesnel, does have the  the order a f t e r that point  s i z e of the  L.Q.  Prince  i n d u s t r i a l sector.  highest  center.  The  second h i g h e s t  does not match the decending  centers.  relationship  between the  d e r i v e d m u l t i p l i e r was  tested  s i z e of by  the  community and  electronic  its  computer using  the subprogram Pearson Product Moment C o r r e l a t i o n C o e f f i c i e n t s , a  41 form  of  bivariate  The  resulting  relationship  correlation  r  of  value  analysis  was  +.51  available  (s  =  i n S.P.S.S.  .003),  only moderate s t r e n g t h .  In  indicating  simpler  terms,  c o r r e l a t i o n confirms what i s f a i r l y obvious from a c a r e f u l of  Table  VI  community However,  -  is one  only  a  not  in  take  particular  indicative into  thousand  been e m p i r i c a l l y  and  thirteen  Calculation  of  technique y i e l d e d  Economic  of  fact  that  the  ratio.  with  the  c e n t e r s vary  Base A n a l y s i s  has  usually  communities,  the  the  analysis  really  tens  population cannot  of  basic-nonbasic  other  ratios  using  the  studies.  For  each  M.R.  industry,  1:1.29 with an average  The  the the  taken as being the minimum to 4^  of the f l u k e s which Alexandersson and M o r r i s s e t t exist.  be  relationship.  r e s u l t s that are much more oompatable with  results  might  study  employment  With suoh a l i m i t e d range of  second lowest ranked percentage was  suggested  the  size  p o p u l a t i o n s of the  expected to produce a near p e r f e c t  a v o i d any  the  the  the  t e s t e d u s i n g c i t i e s with p o p u l a t i o n s i n the 42  of thousands or more.  empirical  case,  of  account  P r i n c e George, the  few  amongst the  this  always  must  exception of by  that  a  ratios  range  between  employment m u l t i p l i e r of 2.09.  J  both  1:0.78 While  and the  TABLE VI - BASIC-NONBASIC EMPLOYMENT RATIOS CALCULATED USING ECONOMIC BASE ANALYSIS 1971  Population  1971 Labour Force  L.Q. Method**  M.R. Method***  1 :7.02  1:1.17  2,640  1:5.9  1:1.15  4,072  1,945  1:4.36  1:1.07  Smithers  3,864  1,475  1:3-15  1:1.07  MacKenzie  2,332  1,085  1:1.86  1:1.03  Houston  2,232  890  1:2.94  1:1.12  Vanderhoof  1,653  695  1:4.34  1:1.14  F o r t S t . James  1,483  550  1:2.37  1:1.11  Burns Lake  1,367  550  1:3-47  1:1.13  100 M i l e House  1 ,120  545  1:5.0  1:1.16  P r i n c e George and South F o r t George* Quesnel Williams  Lake  33,101  14,930  6,252  Telkwa  712  225  1:2.56  1:1.04  Valemont  693  245  1:2.7  1:0.78  McBride  658  250  1:3.7  1:1.29  *South F o r t George was combined with P r i n c e George because i t i s l o c a t e d w i t h i n two to three miles of the c i t y . **The L.Q. derived r a t i o s were c a l c u l a t e d using n a t i o n a l versus l o c a l employment by i n d u s t r y as d i s c u s s e d i n S e c t i o n 3.3. ***The M.R. derived r a t i o s were c a l c u l a t e d using the second lowest ranked percentage (K f a c t o r ) as discussed i n S e c t i o n s 3.4 and 3.6. Source of p o p u l a t i o n and labour f o r c e f i g u r e s : S t a t i s t i c s Canada, 1971 Census of Canada.  61 multiplier  is in line,  p o p u l a t i o n s and poor r  M.R.  a  test  of  generated  value of +.04  the  relationship  multipliers  (s = 0.247).  between  y i e l d e d an  the  extremely  The weak r e l a t i o n s h i p i s not  p a r t i c u l a r l y s u r p r i s i n g nor i n d i c a t i v e of the r e l a t i o n s h i p which might be found  i f , as mentioned, c e n t e r s with a much wider range  of p o p u l a t i o n s i n the province were subjected to s i m i l a r  testing.  S t a t i s t i c a l t e s t i n g was done on the r e l a t i o n s h i p between the. s i z e of the p o p u l a t i o n and it  had  been  suggested  relationship exists. an  almost  labour f o r c e i n each community s i n c e  by  The  r  perfect positive  one would expect  with  caution  a  would  linear  relationship,  in population. of  +.99  the  constant  (s = .001),  thus  in  found  in  theory  i n the labour f o r c e T h i s f i n d i n g must  small  size  of  the  i t cannot be assumed t h a t such  be  where the number and  somewhat  value produced was  because  under i n v e s t i g a t i o n and relationship  that  a constant r i s e or decrease  as a s i m i l a r change occurs viewed  analysts  a l l circumstances,  be  centers a strong  expecially  s i z e of the communities i s much g r e a t e r .  44 Alexander  raised  the  question  upon the b a s i c - n o n b a s i c r a t i o s . proximity concept not  of one  which has  suggest  what  center  of  the  He thought  to another  may  effect  of  location  i t p o s s i b l e that the  i n f l u e n c e the r a t i o s ,  a  i t s r o o t s i n c e n t r a l p l a c e theory, but he d i d consequences  might  be  expected.  Although 45 C  evidence that  was  presented  remoteness tends  i n the  Ontario  to decrease  f i r m c o n c l u s i o n . c a n be drawn here. higher House  the  of  the  region,  while  industry  basic-nonbasic  The L.Q.  f o r the more densely populated portion  forest  study  ratio,  r a t i o s are somewhat  P r i n c e George to 100 at  the  no  relatively  Mile  remote  communities of MacKenzie, F o r t S t . James, and Valemount they  are  62 lower.  However, the accuracy of the L.Q.  r a t i o s i s q u i t e open t o  q u e s t i o n , thus to t e s t the e f f e c t of l o c a t i o n on the r a t i o s , M.R.  generated  the  f i g u r e s would be more a c c e p t a b l e but they a l s o  do  not produce a d i s c e r n a b l e p a t t e r n . Comparing M.R.  the  technique,  ratios  the  the  produced  latter  nonbasic  by  clearly  the  L.Q.  provides  employment  method a  more  generated  by  and  the  accurate  indicator  of  the  basic  industrial  s e c t o r , most of i t i n v o l v e d i n wood p r o c e s s i n g .  The  employment m u l t i p l i e r of 2.17  f o r P r i n c e George, f o r example, i s  fairly  of  close  to  the  figure  2.43  calculated  by  Reed  and  46 Associates  i n t h e i r survey of the c i t y .  generated by the L.Q. without use. small  i n c r e a s e d nonbasic The  the m u l t i p l i e r s are f a r too high f o r such  they  do  reflect  the  to  a  moderate  degree  the  i n d u s t r i a l s e c t o r as the p o p u l a t i o n i n c r e a s e s .  i n f e r e n c e i s t h a t when  terms,  ratios  method should not be dismissed as e n t i r e l y  Although  communities,  However, the  relationships  discussing multipliers  revealed  by  the  L.Q.  in  method  relative can  have  validity. In  Table  calculated  by  communities  VII, the  to  the  M.R.  present  characteristics.  basic  and  technique, a  nonbasic has  composite  of  The minimum percentage  been the  employment, totalled  as  for  the  r e g i o n a l employment  assumed as necessary i n  each i n d u s t r y to supply the needs of the r e g i o n (as represented by the t h i r t e e n communities) i s a p p l i e d a g a i n s t the t o t a l force  of  26,024,  workers should nonbasic  be  yielding expected.  employment  b a s i c employment.  a  while  figure  which  T h i s number  anything  indicates  or  i n excess  anything of  the  how  labour many  lower  is  figure  is  TABLE VII - BASIC/NONBASIC  EMPLOYMENT IN THE CENTRAL  INTERIOR AS CALCULATED BY THE  MINIMUM REQUIREMENTS TECHNIQUE  Industry  Labour Force  M.R.{%)  Basic  Nonbasic  95  0  95  0  1430  3.9  419  1011  20  0  20  0  210  0  210  0  Manufacturing  4530  7.9  2475  2055  Construction  1935  2.4  1300  635  Transportation  3045  6.6  1323  1722  Trade  4250  8.9  1935  2315  Finance  1035  1.8  569  466  Community Business  6095  13.6  2556  3539  Public  1285  1.7  848  437  2094  6.3  443  1651  12,193  13,831  Agriculture Forestry Fishing Mining  Administration  Unspecified Totals  26,024  64 One of the problems  associated  with  obvious when comparing the basic-nonbasic industries. in  the M.R.  approach i s  f i g u r e s i n many of the  For example, the r e g i o n does not r e q u i r e 1011 people  f o r e s t r y to supply  the i n t e r n a l p o p u l a t i o n ,  workers to take care o f the export market.  l e a v i n g only 419  On the other hand, i n  the f i n a n c e s e c t o r i t i s u n r e a l i s t i c to b e l i e v e that over h a l f of the labour central the  f o r c e i s engaged i n p r o v i d i n g s e r v i c e s o u t s i d e  interior.  The assumption  communities  can  be  calculated  percentage employed i n a given when d e a l i n g with an area  of  the  the minimum r e q u i r e d by from  the  second  lowest  i n d u s t r y i s somewhat unreasonable  where much of the b a s i c employment i s  engaged i n the same a c t i v i t y . percentage  that  of the  labour  The r e s u l t i s that f a r too high a force  is  relegated  to  nonbasic  employment because even the second lowest percentage i s too high. The  opposite  industries  holds  where  true  in  the minimum  some  requirement  b a s i c employment i s exaggerated. of the s m a l l e r towns being  in  This  the  service  oriented  i s too low thus the  i s cause i n part by some  i n c l o s e proximity  such as P r i n c e George, t h e r e f o r e to supply  of  to a l a r g e r center,  r e l y i n g upon the l a r g e r  center  c e r t a i n s e r v i c e s which otherwise would l i k e l y be found  the s m a l l e r  individual  places.  The  basic-nonbasic  ratios  f o r the  i n d u s t r i e s t h e r e f o r e cannot be accepted as a c c u r a t e l y  i n d i c a t i n g the economic s t r u c t u r e w i t h i n the r e g i o n . The  net r e s u l t of the M.R. induced basic-nonbasic  employment  r a t i o s i s a r e g i o n a l employment m u l t i p l i e r of 2.13, meaning that each  job i n b a s i c  nonbasic  industry  sector.  inaccuracies  amongst  The  i s responsible multiplier  f o r 1.13 jobs  works  out  i n the  despite  some of the i n d i v i d u a l i n d u s t r i a l  the  ratios  65 b e c a u s e t h e o v e r and the  net  result  compared t o t h e the  forest  still for  is  a  multiplier  m u l t i p l i e r s found  industry  tend to b a l a n c e out that  seems  i n other  (summarized  empirical  i n Table  P r i n c e G e o r g e c a l c u l a t e d by f i g u r e s i n Table VII  Reed and  IV).  studies  begin to reveal  such  as  of  i t is  and  2.49  Associates. the  t h e y r a i s e as t h r o u g h what t h e y s e r v e t o e x p l a i n . inconsistencies,  that when  However,  r e g i o n a l economy, as much t h r o u g h some o f t h e  obvious  so  reasonable  l o w e r t h a n t h e employment m u l t i p l i e r o f 3 f o r B.C.  The the  underestimations  the  complexity  of  questions  that  There are  some  supposed  lack  of  an  a g r i c u l t u r a l i n d u s t r y f o r i n t e r n a l consumption, a s i t u a t i o n which results  from  agricultural  communities. matter  how  outside  the  of  within  study  present  the  region  to  be  forestry  the  and  yet  case,  becomes r a t h e r It defines involved locally  is  contributing T a k i n g as an  boundary  outside  something  included.  However, t h e  l a r g e l y of  manufacturing  i s alway  far  more shown  the  division  the  fact  as  that  basic  between  left  The  basic  labour  force  pulp,  and  some o f  the  employment  basic  No  industrial  (sawmilling,  the  the  delimitation.  i s defined  composed  of  and  than  nonbasic  unclear. to  industry  i n the but  of  even a c c e p t i n g  essential  basic  be  be  i n d u s t r i e s have  should  problem  being  some i n t e r e s t i n g c h a r a c t e r i s t i c s .  i s assumed  paper) c a t e g o r i e s other  is a  i t which could  categories industry  This  employment  export  sells to  recall  as  that  of  g o o d s and  outside  economic  example the  that  of  the  portion  the  growth  economic  of  the  services region's  under  base  economy which  theory that  i t produces  boundaries,  normal  is  thus  circumstances.  transportation industry, i t i s possible  to  construct  complexity  a  of  the  theoretical system.  situation  Much  of  to  the  demonstrate  transport  the  function  i n v o l v e d i n t h e movement o f f o r e s t p r o d u c t s by r o a d and r a i l w i t h i n and o u t s i d e sophisticated created.  transport  The  obviously  of the region, network  employment  in  the r e s u l t being and  the  that a  infrastructure  transportation  is  both fairly  has  been  sector  will  a t t r a c t a demand f o r more l o c a l s e r v i c e s b u t t h a t  does  n o t make i t a b a s i c e m p l o y e r b e c a u s e i t i s n o t s t i m u l a t i n g e x p o r t orientated  business,  only  adding  to  However, t h e good  transport  industry  i n an e x p o r t o r i e n t e d  involved  the  a v a i l a b l e could  internal  attract a  goods  foot-loose  producing  w h i c h can l o c a t e anywhere w i t h adequate t r a n s p o r t a t i o n . i n d u s t r y w o u l d be a b a s i c e m p l o y e r b u t i n r e a l i t y or  independent i n r e l a t i o n  to the r e s t  system.  service This  i s i t dependent  o f t h e economy?  f o r e s t i n d u s t r y was t o s u f f e r a s h a r p and p e r m a n e n t  I f the  decline,  this  w o u l d a f f e c t t h e s e r v i c e s o f f e r e d by t h e t r a n s p o r t i n d u s t r y it  will  have  lost  w o u l d be t h a t i s no l o n g e r  i t s major  source of  the f o o t - l o o s e  income.  i n d u s t r y may  find  The that  end  since result  i t slocation  a s i d e a l a s when t h e f o r e s t i n d u s t r y was  f o r c i n g a move o r r e d u c t i o n  new  prospering,  i n employees. 47  Many purpose  such  t h e o r e t i c a l examples  can  i s merely to demonstrate that  be  created,  industrial  linkages  w h i c h a r e so i n t e r w o v e n t h a t what on t h e s u r f a c e may reproducable to a simple a  much more  complex  explanation  system.  or theory  but  the  exist  a p p e a r t o be  i s i n f a c t part of  Sayer's c r i t i c i s m  of  the  Lowery  48 model, hits  with home  causation  the  i t s foundations point  between  that  the major  the  partly model  i n economic cannot  base  measure  elements of a system  theory, two-way  ( f o r example,  67  basic versus nonbasic). model not  i s not e n t i r e l y  purport  certainly  anything  the techniques it.  because t h e a n a l y s i s  but a s t a t i c  e m p l o y e d up t o t h i s  industry.  central  interior  employment,  To  even  suggest  much f u r t h e r  i s the case.  otherwise along  It is still  insight  results Base into  unanswered.  of applying  Analysis  the  t h e economic The a n a l y s i s  economic  system  through  compared  to other  Although  i t is  multipliers  (2.13)  empirical  lower  development extractive  and M.R.  techniques  interior  b u t many  provide  questions  between t h e f o r e s t I t cannot  some remain  e x p l a i n the workings of  identification  t o t h e problem  than  approach  which  seems  studies Reed  f o r P r i n c e George ( 2 . 4 9 )  of  o f how t h e b a s i c and  and  time.  An a t t e m p t a t  i s made i n C h a p t e r has most  4.  provided  the  acceptable  when  the forest Associates'  and B r i t i s h  As d i s c u s s e d e a r l i e r , a f i e l d  a f i r m - b y - f i r m approach  of  i n d u s t r y and t h e  industry. employment  Columbia  b o t h o f them a r e somewhat h i g h e r t h a n most o f t h e o t h e r multipliers.  the  industrial sector.  t h e L.Q.  Requirements  multiplier  placing  c a n go o n l y s o f a r a s t o i d e n t i f y t h e  p r o v i d i n g a dynamic approach  employment  be  v e r y much a r e s o u r c e  n o n b a s i c s e c t o r s i n t e r a c t and c h a n g e t h r o u g h  Minimum  b a s i c and  r e l i e s upon t h e  i n i t s economic  structure  i n d u s t r i a l employers.  The  appear  would  to the central  strength of the r e l a t i o n s h i p nonbasic  and  point i n the study  i f i t may  economy b a s e d e s s e n t i a l l y upon a s i n g l e  Economic  does  relationship  when m e a s u r e d i n c e r t a i n w a y s , s t i l l  forest  The  c o n c e r n w i t h t h e Lowry  What must be e m p h s i z e d i s t h a t u l t i m a t e l y much  the region's  independent  than  a p p l i c a b l e here  t o measure  do n o t p e r m i t of  However, S a v e r ' s  (3.0),  studies'  survey  i n t h e form o f  w o u l d be i d e a l b u t , g i v e n  circumstances,  not  a workable s o l u t i o n  hypothesis an  of this  Since  that s u f f i c i e n t  e m p i r i c a l a n a l y s i s of the region's  E.B.A., t h e n one  may  2.3  is  t h e a n a l y s i s has a c h i e v e d  justifiably accurate.  implement be  study  a t the time.  question The  d a t a does e x i s t economic  i n the  to allow  structure  using  a degree o f s u c c e s s .  What  i s whether  problem  i t was a r g u e d  i s to  or not a m u l t i p l i e r find  and  of  successfully  some form o f e c o n o m i c a n a l y s i s on t h e r e g i o n w h i c h c a n  p r o v e n t o be more  accurate.  69 CHAPTER 3 Footnotes 1.  Arthur M. Weimer and Homer Hoyt, P r i n c i p l e s E s t a t e (New York: Ronald Press, 19391^  2.  See W. ' L e o n t i e f et a l . , S t u d i e s i n the S t r u c t u r e of the American Economy: T h e o r e t i c a l and E m p i r i c a l E x p l a n a t i o n s i n Input-Output A n a l y s i s (London: Oxford Press, 1953), f o r some e a r l y examples of the a p p l i c a t i o n of input-output a n a l y s i s . See a l s o Chapter 8 of W. I s a r d et a l . , Methods of Regional A n a l y s i s : An I n t r o d u c t i o n to Regional Science (Cambridge, Massachusetts: The M. I .T. Press, 1960). A~~ more recent d i s c u s s i o n of input-output can be found i n Chapter 7 of W. I s a r d , I n t r o d u c t i o n to R e g i o n a l Science (Englewood C l i f f s , New J e r s e y : P r e n t i c e - H a l l , 1975). A good i n t r o d u c t i o n to econometric modelling is found in Gerhard Tintner, Econometrics (New York: John Wiley and Sons, 1952).  3.  For example, see Maurice H. Yeates and Barry J . Garner, The North American C i t y (New York: Harper and Row, 1971), p. 130.  4.  For a d i s c u s s i o n and c r i t i c a l a n a l y s i s of the Lowry model, see R. Andrew Sayer, A C r i t i q u e of Urban M o d e l l i n g - From Regional Science to Urban and Regional P o l i t i c a l Economies, Volume 6, Part 3, pp. 195-201.  5.  M. Aurousseau, "The C o n s t r u c t i v e Problem", 1921, pp. 563-592.  6.  Richard Hartshorne, "The Twin City District", G e o g r a p h i c a l Review, V o l . 22, 1932, pp. 431-442.  7.  Weimer and Hoyt,  8.  Richard B. Andrews, "Mechanics of the Urban Economic Base", Land Economics, V o l . 29, 1953, p. 163. T h i s i s the f i r s t of a s e r i e s o f twelve a r t i c l e s by Andrews which appeared i n c o n s e c u t i v e i s s u e s of the j o u r n a l from May, 1953 to February, 1956.  9.  Ibid.  10. John W. Economic 260.  of Urban  Real  Distribution of Population : A The G e o g r a p h i c a l Review, V o l . 11, The  op.cit.  Alexander, "The Basic-Nonbasic Concept of Urban F u n c t i o n s " , Economic Geography, V o l . 30, 1954, p.  11. I s a r d , Methods of Regional A n a l y s i s : Regional S c i e n c e, o p . c i t . , pp. 189-198.  An  Introduction  12. F e d e r a l Reserve Bank of Kansas City, "The M u l t i p l i e r i n W i c h i t a " , Monthly Review, V o l . 37, 1952.  to  Employment September,  70 13. I s a r d , Methods of Regional A n a l y s i s ; Regional S c i e n c e, o p . c i t . . p. 196.  An "  Introduction  to  14. The W i c h i t a study u t i l i z e d the L o c a t i o n Q u o t i e n t i n two ways: (1) comparing W i c h i t a ' s percentage share of each i n d u s t r y with i t s percentage share o f U.S. p o p u l a t i o n , and (2) d i v i d i n g W i c h i t a ' s per c a p i t a employment i n each i n d u s t r y by per c a p i t a employment i n the U.S. 15. Charles M. Tiebout, The Community Economic Base Study York: Committee f o r Economic Development, 1962), p~. 47. 16.  Yeates and Garner, o p . c i t . , p.  17.  Tiebout,  (New  122.  op.cit.  18. Roger L e i g h , "The Use of L o c a t i o n Quotients i n Urban Economic Base S t u d i e s " , Land Economics, V o l . 46, 1970, pp. 202-205. 19. I b i d , p. 205. 20. Edward L. Ullman, M i c h a e l F. Dacey, and Harold Brodsky, The Economic Base of the 101 Largest U.S. C i t i e s and Minimum Requirements f o r 1967) ( S e a t t l e : U n i v e r s i t y of Washington, 1968), p. 17. 21. T i e b o u t ,  op.cit.  22. Harold Brodsky and David E. S a r f a t y , "Measuring the Urban • Economic Base i n a Developing Country", Land Economics, V o l . 53, No. 4, November, 1977. 23.  I b i d , p. 447.  24. Ullman, Dacey, and Brodsky, o p . c i t . , p. 17. 25. I b i d , pp.  19-20  26. Gunnar Alexandersson, The I n d u s t r i a l S t r u c t u r e of American C i t i e s ( L i n c o l n : U n i v e r s i t y of Nebraska Press, 1956). 27. I r v i n g Morrissett, "The Economic Structure of American C i t i e s " , Papers and Proceedings o f the R e g i o n a l Science A s s o c i a t i o n , V o l . 4, 1958, pp. 239-256. 28. Edward L. Ullman and M i c h a e l F. Dacey, "The Minimum Requirements Approach to the Urban Economic Base", Papers and Proceedings of the Regional Science A s s o c i a t i o n ^ V o l . 6~7 1960, pp. 175-194. 29. Richard T. P r a t t , "An A p p r a i s a l of the Minimum Requirements Technique", Economic Geography, V o l . 44, 1968, pp. 117-124. 30. Ullman, Dacey, and Brodsky, o p . c i t . , p. 51.  71  31.  H e d l i n , Menzies, and A s s o c i a t e s , The O n t a r i o F o r e s t Industry -Its Direct and Indirect Contribution to the Economy (Province of O n t a r i o , Department of Lands and F o r e s t s , 1 9 6 9 ) .  32.  I b i d , p.  33.  A.G. Teskey and J.H. Smyth, Employment, Income, Products, and Costs i n Manitoba's Primary Wood-Using Industry (Edmonton: Northern F o r e s t Research Centre, Canadian F o r e s t r y S e r v i c e , Environment Canada. Information Report NOR-X-138, November, 1 9 7 5 ) and Saskatchewan's F o r e s t Industry and I t s Economic Importance (Edmonton: Northern F o r e s t Research Centre, Canadian F o r e s t r y S e r v i c e , Environment Canada. Information Report NOR-X-140, November, 1 9 7 5 ) .  34.  Donald F. F l o r a , "Economic E v a l u a t i o n of P o t e n t i a l European Pine Shoot Moth Damage i n Ponderosa Pine Region" (U.S. F o r e s t Service, Pacific Northwest Forest and Range Experiment S t a t i o n , Research Paper PNW 2 2 , May, 1 9 6 5 ) .  35.  Hays B. Gamble, "The Regional Economic Role of F o r e s t Product I n d u s t r i e s " , J o u r n a l of F o r e s t r y , V o l . 6 6 , 1 9 6 8 , pp. 4 6 2 - 4 6 6 .  36.  O p . c i t . , p. 71 •  37.  Business-Economics Advisory and Research, Inc., The Role of F o r e s t Lands i n the Washington Economy (Washington F o r e s t P r o t e c t i o n A s s o c i a t i o n , December, 1 9 7 0 ) .  72.  38. K.L. Runyon et a l . , A n a l y s i s of the Economic Impact of Sawmills and Pulp and Paper Mills in Nova Scotia (Fredericton: Maritimes F o r e s t Research Centre, Canadian F o r e s t r y S e r v i c e , Department of the Environment. I n f o r m a t i o n Report M - X - 3 3 , J u l y , 1 9 7 2 ) . 39.  Wilbur R. Maki et a l . , "Importance of Timber-Based Employment to the Economic Base of the D o u g l a s - F i r Region of Oregon, Washington, and Northern C a l i f o r n i a " ( P o r t l a n d , Oregon: U.S. F o r e s t S e r v i c e , F o r e s t and Range Experiment S t a t i o n , Research Paper PNW 76, A p r i l , 1968) .  40.  F.L.C. Reed and A s s o c i a t e s , The B r i t i s h Columbia F o r e s t Industry - I t s D i r e c t and I n d i r e c t Impact on the Economy ( V i c t o r i a : Province of B r i t i s h Columbia, Department of Lands, F o r e s t s and Water Resources, 1 9 7 3 ) -  41.  Norman H. Nie et a l . , S t a t i s t i c a l Package f o r the S o c i a l S c i e n c e s (Toronto: McGraw-Hill Book Company, Second E d i t i o n , 1975), pp. 2 8 0 - 2 8 8 . A l l t e s t i n g was done at the U n i v e r s i t y of B r i t i s h Columbia using an I.B.M. 3 7 0 / 1 6 8 computer.  42.  For example, Alexandersson , o p . c i t . , analyzed only the 8 6 4 American c i t i e s with 1 9 5 0 p o p u l a t i o n s of 1 0 , 0 0 0 or more. The major problem with a p p l y i n g either the L.Q. or M.R. techniques to c e n t e r s with p o p u l a t i o n s of a few hundred or  72  thousand employment  is in obtaining data, especially in  Alexandersson,  44.  Alexander,  45.  Hedlin  46.  Reed  47.  See, f o r example, I s a r d , Methods of R e g i o n a l A n a l y s i s : I n t r o d u c t i o n t o R e g i o n a l S c i e n c e , o p . c i t . , p p . 197-198.  48.  Sayer,  et  and M o r r i s s e t t ,  disaggregated  43.  et  op.cit.  sufficiently Canada. op.cit.  op.cit. a l . ,  a l . ,  op.cit.  op.cit.  op.cit.  p.  51. An  73 CHAPTER 4 ANALYSIS OF EMPLOYMENT, EARNINGS, AND UNEMPLOYMENT IN THE CENTRAL 1973-1976  INTERIOR,  The  analysis  i n the previous  chapter  i s limited  i n that i t  d e a l s w i t h d a t a o b t a i n e d f o r , and r e p r e s e n t i n g , a s i n g l e p o i n t i n time An  analysis  would  they  they  of the l a s t  o f a dynamic n a t u r e explanatory  change.  Such  some  unemployment  incompatible  analysis  -  with  also  linkages  produce  of  which  the others  so  l e t alone  utilizes that  results  Economic  i n t o t h r e e s e c t i o n s -employment, each  determine  i f any, t o w h i c h  which  of suggesting,  the types of  3 to  i n Chapter  could  census.  a p e r i o d o f time  trace  t r u e and t h e e x t e n t ,  capable  i s divided  over  i t could  suggested  inter-industrial  i s n o t even  chapter  an  major Canadian  using data  because  continuously hold  Analysis  and  the date  and r e l a t i o n s h i p s  indicating  The  1971,  be more  conditions if  1,  - July  a  testing. earnings,  form  separate  Base  of  analyses  data are  required. 4.1  A n a l y s i s o f Employment Employment  data  were  provided  by t h e M i n i s t r y  o f Labour,  i  Government o f B r i t i s h  Columbia  and c o v e r  1975-1976  on a m o n t h l y  basis.  7  (the central  interior),  Region  Columbia,  thus  characteristics provincial.  allowing at  Included  a r e data  Prince  comparison  three  t h e two y e a r  levels  of -  George,  employment urban,  period of  f o r Economic and  British  trends  regional,  and and  T h i s d i s a g g r e g a t i o n was n o t a v a i l a b l e p r i o r t o 1 9 7 5 ,  t h e r e f o r e t h e employment a n a l y s i s c o v e r s a s h o r t e r p e r i o d o f t i m e than  f o r the earnings  and unemployment  data.  Table  VIII  employment  reveals  structure  of  some  interesting s t a t i s t i c s  on  both  Prince  central  George  and  the  the  i n t e r i o r but before discussing them in d e t a i l , the reader must be cautioned  against  industrial Prince  taking  category  George  as  the  being  obviously  number absolute  does not  of  totals.  have  every  transportation sector of the region nor those  working  Canada's  in  finance.  sampling  establishments  The  employing  during the year were surveyed.  or  For  each  example, the  does i t have 98.3%  of  employee  lies  whereby  twenty  in  in  problem  technique  employees  with  Statistics  only  industrial  more persons  at  any  time  Since Prince George i s the center  of many of the larger i n d u s t r i a l operations in the region, i t has been the focal point of sampling in the surveys. figures  and  r e s u l t i n g percentages are  too  Thus, while the  high  by  a  quantity  which cannot be accurately determined, they are good indicators of what industries are most dominant and where this dominance i s concentrated. The  small  percentage  (includes loggers interior  logging  operating  workers  employed  It indicates that contractors  there  employing  are  still  less than  in the region despite the trend  s t a t i s t i c s could be found in B.C. accurately  contractors  forestry  as a whole i s of p a r t i c u l a r  pinpoint  in the region  the  persons  in the manufacturing Although no  Forest Service reports which  number  or the  a number of  twenty  end of the industry towards a few major employers.  could  in  forest service personnel) in the central  r e l a t i v e to the province  significance. small  and  of  of  labour  independent  logging  force associated  with  2  them, a lumber  trade  directory  revealed  that  dozens of  such  TABLE VIII - MEAN EMPLOYMENT BY INDUSTRY AND REGION, 1975-76 P r i n c e George Employees  Central Interior  % of T o t a l f o r ; Central I n t .  B.C.  % of T o t a l  Employees  f o r B.C.  3.3 2.9 5.1 3.8 1.8 1.5 2.2 1.7 1.5  995 1,623 10,921 8,533 8,346 2,388 472 1,343 2,494 536 1,632  6.8 12.9 9.1 12 21.5 4.8 2.3 1.5 3-0 1.7 2.9  14,719 12,591 120,672 71,127 38,889 49,545 20,991 89,307 83,795 31,445 55,969  2.1  20,308  4.7  429,591  Forestry Mining Manuf a c t u r i n g * - Durable Goods - Wood Products - Nondurable Goods** Construction Transportation Trade Finance Service  13  1.3  1  3,959 2,079 1,978 1,880 386 1,343 1,820 527 813  36.3 24.4 23.7 78.9 81.7 100 72.9 98.3 49.8  Industrial  8,860  43.6  Composite***  Employees  B.C.  *Durable and nondurable goods are subcategories of manufacturing, thus t h e i r employment when t o t a l l e d equals the employment i n manufacturing. In t u r n , wood products i s a subcategory of durable goods. * * I n c l u d e s pulp and paper production which forms the m a j o r i t y of employment i n t h i s category f o r the c e n t r a l i n t e r i o r . ***The i n d u s t r i a l composite covers the above i n d u s t r i a l c a t e g o r i e s o n l y . I t does not i n d i c a t e t o t a l employment i n P r i n c e George, the c e n t r a l i n t e r i o r , or B.C. S t a t i s t i c s Canada has s t a t e d that the f o l l o w i n g a c t i v i t i e s are excluded - a g r i c u l t u r e , f i s h i n g , and t r a p p i n g , education and r e l a t e d s e r v i c e s , h e a l t h and w e l f a r e s e r v i c e s , r e l i g i o u s o r g a n i z a t i o n s , employment i n p r i v a t e households, and p u b l i c a d m i n i s t r a t i o n and defense. Source; Employment i n B r i t i s h Columbia by Industry ( V i c t o r i a : Research and P l a n n i n g Branch, M i n i s t r y of Labour, Province of B r i t i s h Columbia).  -o  76 s m a l l operators  do e x i s t .  The l o g g i n g  statistics  the h i g h l y mechanized h a r v e s t i n g techniques interior  which have reduced  also  suggest  used i n the c e n t r a l  the need f o r the r e l a t i v e l y  labour f o r c e r e q u i r e d f o r c o a s t a l l o g g i n g .  large  Even i f the r e g i o n ' s  t o t a l percentage o f l o g g i n g employees i s somewhat higher than the 6.8% shown, the i m p l i c a t i o n i s s t i l l t h a t a r e l a t i v e l y s m a l l work force  i s responsible  industry total  f o r supplying  which accounts  of employment  forestry  employee  f o r over  i n this i s high,  timber  t o a wood  one-fifth  o f the  category. due  Since  mainly  products  provincial  p r o d u c t i v i t y per  t o mechanization,  the  permanent l o s s or a d d i t i o n of jobs i n the i n d u s t r y should have a significant In  impact on the t o t a l r e g i o n a l economy.  Table  IX,  the percentage  of  fluctuation  in forestry  employment i s shown to be higher  (50.6%) i n the c e n t r a l i n t e r i o r  than  Interior  f o r the p r o v i n c e  seasonal normally whether  nature  (45.3%).  while  on  the  coast  logging  the  climatic  allow f o r year-round work i n the woods. or not t h i s  fluctuation  two  categories  Pearson  correlation  +.04(s  =  relationship over  The q u e s t i o n i s  0.184)  was  industrial  employment  statistically  tested,  subprogram of S.P.S.S. which  was  between employment  the twenty-four  month  generated  again The  using  r  indicates  Despite  f i n d i n g , i t o b v i o u s l y cannot be i n f e r r e d  supply.  fluctuations in  i n the two s e c t o r s was  period.  has an  i n d u s t r y s i n c e the  i s dependent f o r c o n t i n u a l o p e r a t i o n upon timber  The r e l a t i o n s h i p between the  conditions  i n f o r e s t r y employment  e f f e c t upon employment i n the wood p r o c e s s i n g latter  i s of a more  this  the  value  of  that  no  evident  statistical  that the two i n d u s t r i e s  TABLE IX - FLUCTUATION IN EMPLOYMENT, P r i n c e George  I  Central Interior  max.  min.  1975-76  1  min.  B.C.  1  min.  max.  45. 3 29. 2  9,973 9,611  18,242  27. 2 25. 4  129,655 75,181  46. 2  94,387 56,075 23,356  2,858  30. 7  38,235  55,136  625 1,492  43- 2 11. 7  13,931 82,442  24,542  max.  1 ,244  29  50.,6  2,986  4,484  47..3 34..3  2,243  28.,0  15. 6  1,913 1,796  8,059 6,800  30..0  6,529  943 228  57..0  Construction  57. 9 57. 6  2,127 2,241  Transportation  19. 1  1 ,207  517 1,492  51..7 19.. 1  1,217 302  Trade  1,605  1 ,999  12..9 20,.2  2,271 484  2,608  10. 2  79,586  Finance  19. 7 18. 5  93,329 88,601  607  30,214  33,346  Service  19..9  1 ,457  1,833  9.3 14. 9  50,502  59,315  39..8  17,349  28,833  11. 4  398,584 449,811  82. 8  ForestryMining  • -  Manufacturing - Durable Goods - Wood Products - Nondurable Goods  Industrial  5  Composite  33. 4 14. 7  19. 0  477 740  585 914  17. 1  7,969  9,610  615 992  1 ,207  Source: Employment i n B r i t i s h Columbia by Industry, o p . c i t .  1,883 12,260 9,455 9,324  13,582  43,381  operate  independently  of  one a n o t h e r .  l e v e l o f economic a c t i v i t y ,  As Pearse  states,  "The  i n terms of income and employment, i n  t h e s e communities ( r e f e r r i n g t o m i l l towns) i s determined by the availability  of  t i m b e r from these r e g i o n s  (harvest  areas),  and  the r e l a t i o n s h i p between wood produced and income and employment is  more or  less  constant."  This  J  statement  is  i n reference  l o n g - t e r m i n s t a b i l i t y o f l o g s u p p l y , thus the i n f e r e n c e  is  over  not  short  periods  (ie.,  seriously affected. of  timber  when  months),  production  need  to that be  T h i s can be a c h i e v e d through the s t o c k p i l i n g  the  mills  anticipate  seasonal  slowdowns  or  c l o s u r e s i n the woods, most of which l a s t f o r o n l y a month or two. Indicative  of  the r e l a t i v e  s t a b i l i t y of m i l l  production is  the  f l u c t u a t i o n i n wood p r o d u c t s employment o f 3 0 % as compared to the much h i g h e r  figure  for  logging  employment.  The  i n t e r i o r wood  p r o d u c t s i n d u s t r y i s i n f a c t more s t a b l e than f o r the p r o v i n c e as a whole,  i n c l u d i n g the c o a s t where h a r v e s t i n g can o p e r a t e  almost  continually. In t e s t i n g the s t r e n g t h o f the r e l a t i o n s h i p between and  p u l p and paper employment,  nondurable  goods  calculated.  Again,  interdependence substantial rather  1975  which  because of  the  sawmills.  here  pulp  and  supply  Part of  can be a t t r i b u t e d  involved  fluctuation  value suggests  their  nearly  i n t e r i o r ' s p u l p and paper 57*9%  an r  reality  portion  than v i a  relationship  category,  which forms  in  all  of  of  forestry  the m a j o r i t y +.0(s  that  of  the  = 0.399)  was  there  paper  mills  directly  from  must  be  receive  a  the  woods  the problem i n t r a c i n g to the  a f o u r month s t r i k e workers  i n the  the in  central  i n d u s t r y , c a u s i n g an u n c h a r a c t e r i s t i c  employment  within  the  nondurable  goods  category. section  The  on  analysis  impact of t h i s s t r i k e i s examined i n d e t a i l i n the  unemployment  a n a l y s i s while  of the wood products  sector  the  focus  here  i s upon  of manufacturing where  no  lengthy work stoppages took p l a c e . F l u c t u a t i o n i n wood products one-half the  employment i n P r i n c e George  of t h a t f o r the c e n t r a l i n t e r i o r and  provincial  employment  fluctuation.  i n sawmilling  The  and  relative  plywood  only o n e - t h i r d stability  production  g r e a t e r s i z e of the community over surrounding  of  and  T h i s allows demand to be  employment  that  could  some of the shorter-term absorbed  occur  without  under  controlled  by  external  little  matter  of  except  internal  eventually  notes  supply  i s not  regions  have  transportation,  Here supply  uncommon with tended  conditions  in  upon other  forest  supply  Prince  is  industry largely  George  has  a the  r e g i o n , a s i t u a t i o n which  size  to  variations in  While demand i s e s s e n t i a l l y  adjust,  regulation.  products  same e f f e c t  f a c t o r s about which the  advantage of an enormous timber Pearse  the  similar  communities with s m a l l e r o p e r a t i o n s .  do  Prince  a s i z e a b l e labour f o r c e from which to draw as w e l l as  operations.  can  the  centers which are  the b e n e f i t s which come from the sheer s c a l e of i t s wood  supply  of  local  comes with  p a r t of the l a r g e r f l u c t u a t i o n f o r the c e n t r a l i n t e r i o r . George has  was  -  "Generally,  expand  with  economies of c e n t r a l i z a t i o n ,  and  economic  advances  in  i n t e g r a t i o n of  4 manufacturing." The  proportion  of  the  total  i n v o l v e d i n the wood products a  strong  influence  Statistical  on  analysis  local  regional  employment  s e c t o r suggests t h a t i t would have  employment for  and  Prince  in  the  nonbasic  George  industries.  revealed  several  80 correlations were weak. and  of  moderate  values  For example, the r  f o r s e r v i c e i t was  +.0(s  but  overall  the  relationships  value f o r trade was +.22(s =  = 0.413).  Of moderate s t r e n g t h  t r a n s p o r t a t i o n with +.36(s = 0.001) while f i n a n c e was +.52(s = .001).  Again,  one  0.01) was  h i g h e s t at  must q u e s t i o n whether or not  these  t e s t s of the s t r e n g t h of the r e l a t i o n s h i p s between wood products and  the  nonbasic  results. clearly  economic  sectors  are  producing  meaningful  There i s no obvious e x p l a n a t i o n f o r f i n a n c e being tied  to employment  fluctuations  i n the  forest  more  industry  than to some of the s e r v i c e i n d u s t r i e s which e x h i b i t l i t t l e or no correlation.  At  relationships  the  regional  scale,  results  similar  generated  testing to  of  those  the for  same Prince  George. 4.2  A n a l y s i s of Earnings The  earnings  Labour and the  cover  employment  period  data the  data,  between 1973  to gross  pay  items  overtime,  as  living  and  were  also  s u p p l i e d by  the  Ministry  of  industries  as  same g e o g r a p h i c a l areas  and  however  forty-eight  and  they  1976.  are  "The  for a  earnings  figures  f o r the week, before deductions, and piecework  and  other bonuses, and  weekly f i g u r e s were averaged  commission  month  correspond  i n c l u d e such  earnings,  cost  other r e g u l a r premium pay."  of The  out by S t a t i s t i c s Canada to provide  the mean weekly earnings f o r the month by i n d u s t r y . Table  X  indicates  that  there  is  no  one  of  the  g e o g r a p h i c a l areas that i s c o n s i s t e n t l y higher or lower others  i n terms of weekly earnings  does have a higher'average George or the c e n t r a l  by  industry.  three  than  However,  the B.C.  i n more c a t e g o r i e s than e i t h e r P r i n c e  interior.  T h i s i s the r e s u l t  of  certain  TABLE X - MEAN WEEKLY EARNINGS BY INDUSTRY AND REGION, 1973-76*  P r i n c e George Forestry-  $ 250.53  Central  B.C.  Interior  $ 271.54  $  270.50  269.47  278.53  257.49  244.51  237.36  229.09  232.74  238.81  227.24  232.39  234.73  288.70  285.03  235.33  Construction  295.09  301.88  308.34  Transportation  213-37  213-37  237.01  Trade  187.70  186.24  178.90  Finance  172.06  171.69  184.71  Service  121.71  116.81  142.47  223-35  228.73  216.37  Mining Manufacturing - Durable Goods - Wood Products - Nondurable Goods  Industrial  Composite  *See the f o o t n o t e s i n Table VIII f o r a d e t a i l e d e x p l a n a t i o n of the i n d u s t r i e s . Source: Average Weekly Earnings i n B r i t i s h Columbia by Industry ( V i c t o r i a : Research and Planning Branch, M i n i s t r y of Labour, Province of B r i t i s h Columbia).  00  82 regions mostly For  within  the p r o v i n c e  as a consequence  example,  having  of t h e i r  have  workers.  As w e l l , more overtime  traditionally  labour f o r c e .  been  and  high  remote  Peace  higher  earnings, locations.  River  to  regions,  attract  skilled  and bonuses are accrued  by the  The c e n t r a l i n t e r i o r approximates the midpoint of  the average earnings it  relatively  i n the Northwestern  earnings  extremely  f o r the t e n economic regions i n B.C.,  could be viewed as a semi-remote area.  thus  In the more populated  southern r e g i o n s , the average wages are g e n e r a l l y the lowest. P r i n c e George has a lower of  the c e n t r a l  larger to  interior,  an  i n d u s t r i a l composite than the r e s t indication  that  community and o f f e r s more amenities  attract  offset.  a  labour  force  through  higher  because  i t is a  to workers, the need wages  is partially  I t s average earnings are f u r t h e r depressed  by the l a r g e  number o f employees i n the i n d u s t r i e s such as t r a d e and s e r v i c e which  typically  pay lower  wages.  In c o n t r a s t , the nondurable  goods s e c t o r i n P r i n c e George, which i s comprised and  paper  employees,  higher  than  f o r any  either  the r e g i o n  highly s k i l l e d in to  has weekly other  earnings  industry,  or p r o v i n c e .  This  that  except  mostly  of pulp  on average are  construction, i n  i s due to the g e n e r a l l y  jobs which pay w e l l because o f t o t a l u n i o n i z a t i o n  the pulp and paper i n d u s t r y and because the companies keep  employee  turnover  rate  low  in  order  to  strive  minimize  retraining. Within the wood products  category, the mean weekly  earnings  are f a i r l y c o n s i s t e n t between the three g e o g r a p h i c a l areas.  The  wage s t r u c t u r e f o r sawmill and plywood p l a n t employees i s uniform throughout  the p r o v i n c e  although  there  are s e v e r a l  bargaining  83 u n i t s of the is  I n t e r n a t i o n a l Woodworkers o f A m e r i c a , e a c h o f  responsible  for a region  e x a m i n e d on an h o u r l y are  not  as  general  high  level  considered as  as of  abundant.  region  is  contribution  f o r e s t r y or  bonus and  lower  because of the  the  for  sawmill  earnings  paper  most  because  milling  those  per  persons  p u l p and  labour  in  the  that,  of  basic  average,  each  job  on 3  Chapter  to  the  force  products  the  i s quite  overall  significant  the  forest industry  relative  industry in  the  economic  industry 1.13  workers  Given  estimated  in  s e c t o r , the c o n t r i b u t i o n of t h e s e l a t t e r employees to the  economy  I f an  a demand f o r  implications  impact.  was  to  service  less.  creating  not  i n the  is  as  are  workers.  within  measurement  is  wood  paper but  the  jobs  employee  most o f t h e n o n b a s i c i n d u s t r i e s h a v e some i m p o r t a n t for  good when  overtime opportunities  or  l a r g e number o f  higher  in  and  contribution  than i n logging of  earnings are  pulp  required  economic  therefore  manufacturing  The  in  the  The  The  b a s i s b u t wood p r o d u c t s e a r n i n g s as a w h o l e  skill  l e s s and  o f B.C.  which  income m u l t i p l i e r c o u l d  be  derived,  i t  should  This  would  f u r t h e r nonbasic  jobs,  t h e o r e t i c a l l y be l e s s t h a n t h e employment m u l t i p l i e r . impact that  through  are  the  generated  e n t i r e s y s t e m so and  rely  e m p l o y m e n t , w o u l d be c r e a t e d nonbasic  employee  disposable The  distinguish discussing one  i n part  upon  earnings  income f o r g o o d s and  services.  data  also  between the the  point  basic  impact of  hundred workers i n the  the  initial  nonbasic  at a slower r a t e because the  lower  earnings  has  that  to  sectors  the of  and  therefore  need the  less  i n some c a s e s  to  forest industry  in  a multiplier in detail. pulp industry  average  should  For  example,  c r e a t e more o f  a  84 demand  for  produced  employment  by  one  through  hundred  higher  sawmill  workers.  c o u l d be c o m p l i c a t e d by a wide r a n g e either pulp the  to  further  s e c t o r employment wood  products  nonbasic  needs  thus of  confidence  that  produce  equal  or  but  the  w i t h i n the f o r e s t  wood  a r e a f o r use  through  In  determine  the  products  the  even  rely  not  paper  than  in  P r i n c e George, sector  i s almost  Based  upon  with  equal  the  more in  only  of f l u c t u a t i o n  for  the  although  the  than  (see  3%  employment  central  workers  Table  between  work.  fluctuations can The  be wide  their  through  requirements  of  the  sector  i s the  dominant  with force  any  of  the  i t would the  most  be  other  forest  extremely  impact,  related  difficult  measured  by  to that  i n wood  interior  Prince  In  areas  f o r the  i n pulp  George's  the  p r o v i n c e as  geographical  contrast,  ranged  over  the  earnings  explained  by  the  fluctuation  in  for more the  for  and  seasonal  earnings  whole, is  less  fluctuation  28%  forestry  a  areas  a  i n t e r i o r e x h i b i t i n g the g r e a t e s t in  either  products.  composite,  or  between  XI). the  to  i n mean w e e k l y e a r n i n g s i s g r e a t e r t h a n  difference  p e r i o d , the c e n t r a l Higher  upon  i t i s p o s s i b l e to s t a t e  industrial  percentage either  the  greater  income o r employment i n d u c e m e n t , b e c a u s e t h e l a b o u r f o r c e and  of  ultimately  directly  employment  serve  i n d u s t r y simply because of the g r e a t e r a b s o l u t e  employees  sectors.  may  be  example  power  i t so  nonbasic  employees  economic  employers  the l o c a l  the  offset  products  would  o f f a c t o r s which might  At t h e r e g i o n a l l e v e l ,  that  of  from  may  than  However,  greater  perhaps  increasing  the  m i l l as w e l l .  number  Wood  services  operations  or  the  employment  activity.  goods and  the  accentuate  earnings  of  two  in year  instability. construction  nature the  of  their  nondurable  TABLE XI - FLUCTUATION  IN MEAN WEEKLY EARNINGS,* 1973-76  P r i n c e George  Forestry-  Central Interior  1  min.  max.  60.3  $158  $399  Mining Manuf a c t u r i n g - Durable Goods - Wood Products - Nondurable Goods Construction Transportation Trade Finance Service Industrial  Composite  I  min.  max.  I  min.  max.  46.6  $196  $367  51.7  $188  $388  40.0 42.8 41.2 41.4  210  349 335 308  36.9 37.6 38.2  218  345 302 306  49.8 52.6 40.1 41.1  199 204  308 396  40.5 37.5 45.0 37.6  36.0  138  238 216  43.2 41.4  194 178  342 304  44.3 48.6  170 201  54.5 40.1 42.4  200  305 392 440 278  35.9 37.6  138  245 215  95  153  33.4  95  39.0  177  290  37.6  182  167 141  B.C.  192 181 181  167 140  189 189 184 187 225 185  309 299 409 297  139 141  223 226  143  37.5 37.6 36.0  112  175  292  36.8  170  269  430 278  *The minimum and maximum earnings are rounded to the n e a r e s t d o l l a r . Source: Average Weekly Earnings by Industry i n B r i t i s h Columbia,  op.cit.  00  86 goods s e c t o r i s the r e s u l t of the p r e v i o u s l y mentioned four month labour  dispute.  Much  of  the  fluctuation  also  caused  by  so that by  the end  of  increased  wages over the  1976,  average earnings would have been s u b s t a n t i a l l y higher  the  than at the basic  four year p e r i o d  is  1973.  beginning of  industrial  sectors  This  such  as  i s e s p e c i a l l y true  rate  than  encompassed Table  XI  the  nonbasic  that  upon  the  service  forest  in basic  side  a n a l y s i s was  various  industrial  earnings  than  moderately industry +.90  strong  yielded  for trade,  0.001).  the  finance  positive  even  (all s  and  for forestry in  =  consistent  0.001) i n d i c a t i n g a The  wood  products  for  example,  for service  (all s =  were h i g h e r , +.86  manner  They ranged from + .55  relationship.  in finance,  with  emerged which were  c o r r e l a t i o n s which +.94  minor  C o r r e l a t i o n s of equal s t r e n g t h e x i s t e d i n the nondurable  goods (pulp and not  for  r i d e out  reacting  Testing f i r s t  a l l the assumed dependent i n d u s t r i e s . +.66  to  although  i n a more r i g o r o u s  for  to  economy,  to t e s t the r e l a t i o n s h i p s  central interior,  service  values  the  the  for  r  greater  earnings.  applied  over the f o r t y - e i g h t month p e r i o d . 2  a  i s able  rather  swings i n employment and  Statistical  of  industry,  industry  fact  figures in  an  the  in  The  have  e x h i b i t e d i n nonbasic i n d u s t r y over the short-term,  fluctuations  between  traditionally  of  that  is  powerful  at a more r a p i d  lower wage earners.  there  and  degree  indication dependent  i n d u s t r i e s which  bulk of the  suggest  stability  greater  u n i t s , thus wages tend to climb  i n the  the  f o r e s t r y , wood products,  nondurable goods, the employees i n which are covered by union b a r g a i n i n g  of  paper) category.  analysis  has  I t can be questioned whether or  uncovered  legitimate  statistical  relationships if  i t has  over  between t h e  merely  t r a c e d the  four years.  A  wood p r o d u c t s , two  test  an  r  conclusion rather  that,  than  correlation 4.3-  view  of  rather given  some  degree,  have by  correlation This  finding  being  and  independent  of high strength  industrial  are  stating  how  particular  been  each  supports  earnings  the  trends  measured  category  could  occupations  by  be  the  ranging  from  by  fields  majority  of  forestry  and  sawmilling,  as  the  those  any  one  to  managerial  (see  be  persons  seeking  but  Unfortunately, occupational  forest a  and  Table  number  of  logging,  to  under  and  paper,  Canada  i t obviously who  The  falls  includes pulp  employment  industry  XII).  however,  transport.  reliable  George,  of  or  The  Prince  i s by  forestry  and  short-  reports  1976.  obvious,  plywood),  reveal  in a  monthly  in  the  (which  because  unemployed.  unemployed  i n d u s t r y unemployment,  i t s data  for  an  under  logging, processing and  of  breakdown  different  employed  numbers  1 9 7 3 and  i n d u s t r y thus  clerical  forest  were  offices  a  interior  forty-eight  unemployment  from  the  number  Manpower  registered  central  many p e r s o n s  through  the  the  sector,  compiled  of  in  and W i l l i a m s Lake between  considers  between m i n i n g  Canada Manpower^ p r o v i d e  picture  conditions  sixteen  account  0.001).  through  for a  group r a t h e r than  such  earnings  or  in a l l categories  relationship  =  economic  labour  worker  the  wages  sectors  Unemployment  simply  month  statistics  the  an  (s  to  obtained  than  Quesnel,  of  industrial  analysis.  the  produced  the  increasing  interdependencies  A n a l y s i s of Data  term  +.86  of  of  v a r i a b l e s w h i c h would seem t o t a l l y  o f each o t h e r , produced with  earnings  Manpower can  register  only as  88  TABLE XII - UNEMPLOYMENT IN THE CENTRAL INTERIOR, 1973-1976 Mean Unemployed  Fluctuation i n Unemployment (min - max)  Managerial, A d m i n i s t r a t i v e and r e l a t e d  22  0-90  N a t u r a l Science, and r e l a t e d  23  0-99  S o c i a l Sciences and r e l a t e d  14  0-60  Teaching and r e l a t e d  21  1-149  Medicine and Health  41  0-144  C l e r i c a l and r e l a t e d  382  34-1167  Sales  163  13-532  F o r e s t r y and Logging  193  0-881  Processing  230  10-681  Machinery and r e l a t e d  35  0-165  Product F a b r i c a t i n g , Assembly and Repair  60  3-213  328  16-1325  Transport Equipment Operating  84  3-354  M a t e r i a l Handling and related  31  0-106  8  0-34  Engineers  C o n s t r u c t i o n Trades  Other C r a f t s and Equipment Operating  clients  of the s e r v i c e .  There  are no  doubt  others  who  are  unemployed at any given time who do not r e g i s t e r and attempt to f i n d employment on t h e i r own. unemployed  work  insurance,  force  registration  However, assuming t h a t most of the  would with  wish  to  collect  unemployment  the Canada Manpower s e r v i c e i s a  prerequisite. The  data  detailed  shown  i s Table  unemployment  approximately occupational  200  XII  is a  statistics  occupations,  breakdown given  but  here  forest  first  the  industry,  the  statistics  more into  sixteen  is sufficient  to an examination  of much  disaggregated  more s a l i e n t aspects of the unemployment Turning  summary  category  to examine the  trends.  of unemployment  indicate  a  w i t h i n the  fairly  low  mean  unemployment  l e v e l given the s i z e of the b a s i c labour f o r c e .  one accepts  the b a s i c - n o n b a s i c  previous  chapter  as a f a i r  e x h i b i t s a higher the  Assumptions  unemployment 50%  of t h a t  groups  ratio  of 1:1.13 d e r i v e d  estimation,  the unemployment  number  of unemployed nonbasic  Approach,  i f i t i s theorized  that  ratio Using  a l l of the  i n transport,  and  25%  of a l l other  occupational  (an e s t i m a t i o n which seems q u i t e generous),  explained  i n the  i n f o r e s t r y , l o g g i n g , and p r o c e s s i n g i s b a s i c , plus  basic-nonbasio unemployment r a t i o i s 1:2.04. be  workers.  If  by  several  factors  but  the average  The d i s c r e p a n c y may  the most  likely  reason  i n v o l v e s the m o b i l i t y of the labour f o r c e i n the f o r e s t i n d u s t r y r e l a t i v e to some of the other o c c u p a t i o n a l groups. was  proposed  stability 7 policy.  i n part  by  i n the north The f o r e s t  R.  Byron  central  i n h i s study  interior  i n d u s t r y , as with  This of  as r e l a t e d  most  high  concept  community to  paying  forest basic  90 industrial  jobs,  experiencing  tends  high  to  attract  unemployment.  people  This  mobile  young and f r e e o f t h e r e s p o n s i b i l i t i e s or  f a m i l i e s ) which  areas  where  greatest. on  the  t i e them  potential  I f jobs are i n f a c t  to another  unemployed related  would  region  with  f o r long.  On  work  (such  employment  is  the other  hand,  occupied  by a  n o t pay w e l l  and in  instead  enough t o a t t r a c t  go t o t h o s e  committed  they  mobile  These  f o r various  to  as move  remain  i n the s e r v i c e  less  many w o r k e r s  ownership  perceived  or able jobs  often  migrates to  scarce or l a y o f f s occur, few w i l l i n g  regions  force,  a s house  f o r c e c o n s i s t i n g o f permanent l o c a l r e s i d e n t s . do  other  t o one l o c a t i o n ,  for  very  industries are often  from  labour  occupations  from  other  reasons  areas  t o remain  the region. The  idea o f the f o r e s t  unemployed  workers  ramifications focussed can  from  for a  regional  job opportunity economy.  employment  basic  of basic  industry  or  nonbasic,  The  has  has v i r t u a l l y  t h e economic  well-being  be i n c r e a s i n g s o c i a l  no  control.  a  The  large  This  of the region  costs  has  r e l a t i o n s h i p s but t o t h i s  i s to  little  important  discussion  industry yet i t i s a situation  members would have r e l a t i v e l y often  and/or r e t a i n i n g  t h e r e l a t i o n s h i p t o unemployment.  force,  creation basic  f o r the  on b a s i c - n o n b a s i c  be added  labour  hoping  industry attracting  measure  the  over which the group  because  expendable  through  unproductive  detracts  most  of  its  income and would  t h e need  for a variety  o f government s e r v i c e s , i n c l u d i n g Canada Manpower. In seasonal thaw  the f o r e s t  industry,  the logging  sector  employer because o f reduced o p e r a t i o n s  i n March  and A p r i l  and t h e months  i s t h e most  during  o f heavy  the spring  precipitation,  91 normally  in  Machinery  October cannot  conditions,  leaving The  manufacturing  side  strong  few  timber  before  navigate  the  locations  that  of  the  industry  was  correlations.  sectors,  against  forestry  0.001).  a  yielded  p r o c e s s i n g was  and  + .77  The  for  Because forestry  and  analysis  against  teaching the  by  that  logging  independent  of  finding  can  ground  be  logged  to  high  of  the  more  directly  the  the  in  r  other  r  values  construction between  operations,  taking  weaker Measured  value  f o r t r a n s p o r t i t was  correlation  logging  of  employment.  variable yielded for  statistical  contradicts  unemployment  +.80  by  r e s u l t s are s u r p r i s i n g l y  unemployment,  (s = 0.001) and  Testing  groups the  freeze-up.  boggy  measured  positive relationships for several  relationships  complete  e f f e c t of t h i s decreased p r o d u c t i v i t y upon the  to d e r i v e  involved  + .26  November  effectively  continually.  analysis  and  +.84  for (s =  occupational ranging  (all s  =  processing processing  from  0.001). and  the  as  the  independent v a r i a b l e produced r e l a t i o n s h i p s s i m i l a r to the former unemployed group.  The  low  r  and 2  was  the  expected c o n s t r u c t i o n  r  the of  high +.79  value (both  s  =  value  was  again  0.001), e x c l u d i n g  teaching sector  at  +.30,  with  f o r e s t r y , logging,  an and  transportation. The  analysis  occupational  Thus,  of  figures  -  XII,  increasing the  occur  i n 1976.  trends  first  in  being  correlating the  monthly  the tendency over the four year  unemployment  minimum  to have been recorded  two  the  the second being  gradually  i n Table  likely  measuring  unemployment  f l u c t u a t i o n s and period  is  number  of  sometime i n 1973  Byron observed  this  in a l l categories. unemployed  i s more  w h i l e the maximum trend  in his  study  and  attributed  communities  the  the  George  population  population  measuring  more  pulling  The  question  is  raised  respond as  it  to  from  sections.  The  immediately  ( w i t h i n the  level  is  assumption  found  obvious  that  because  labour  unfilled  order  by  same  Byron  there  are  be  the  to  has  exhibited  a  be  the  lumber  of  slow  seems  to  greater  in  monthly  nonbasic  sectors  industry  the  to He  decline,  two  adjust  an e q u i l i b r i u m states,  process,  immediately,  again  previous  variables  adjustment  prices  its  towards  forest  unjustified.  in  to  analysis  dependent  dismissed  when  compared  one month p e r i o d )  lags  cannot books  to  slowly  the  findings  depressed  the  relationships  i n the  growing  of  data  how q u i c k l y  that  to  some  number  relative  the out  the  that  Quesnel  of  of  than  of  generally  statistical  fluctuations  was  to  increase  trend  unemployment.  rather  growing  while  the  performance  example,  been  The  than  due  for  has  recently.  rather  industry  region  growth  unemployment  of  interior  unemployment  growth  economic  He n o t e s ,  Prince  disproportionate  poor  central  throughout  in  rapid  be  the  conditions.  unemployed its  to  within  unemployment economic  it  "It  is  perhaps  or  because  of  or  a  in  delay  q  recruitment that  the  reflect  if  adjustment upon the  The  best  unemployment in  the  total  business  region of  occupations dropped  by  stood only  the  which  9 9 , 0 3 9  process  nonbasic  example was  prospects  of 1979  178  750  take  industrial a  large strike  occurred  man-days at  may  improve."^  fluctuation 1,599  of  lost.  unemployed  or  in  pulp  July  months  and 591  rose the  to  forest  to  industry  and p a p e r  and  Unemployment  to  three  concludes  sector.  between  in July  two  Byron  in 769  next  October the  workers with  processing  i n October month,  a  thus  but the  93 10 m a j o r i t y o f t h e s t r i k i n g w o r k e r s d i d n o t seek o t h e r The  regional  pointed  out  stable  so  dispute  economist  that that  the  pulp  most  r a t h e r than  for  Canada  and  paper  workers seeking  results  of  unemployment only  one  months  person the  work.  virtually  from  no  fact,  5934  in  One  ended,  would  effect  on  If end in  indeed of the  contained  is  strike  ways o t h e r The  has  t h e r e i s an  in this  of  employment,  to  no  changed  the  other  Three people  strike  sectors  certainly  among has  explanations  of  short-run able to adjust greater multiplier in  employment  negative  correlations  even  the  the  the  occur. by  the  itself  work.  and  unemployment  largely economic  The  difficult  most  industrial  been  basic  sectors.  incapable system,  a task i t of  the  While  of  the  presenting  i t has  produced  r e g i o n a l economy a p p e a r s o v e r  t o employment  effects  declines  earnings,  i n d i c a t i o n o f how  the  findings.  of  had  of  e f f e c t must  out  by  doubt r a i s e s as many q u e s t i o n s as i t  light  analysis  some s i g n i f i c a n t  October  6668  to  that  on t h e economy, and  p u t t i n g more p e o p l e  chapter  interrelationships  detailed  the  the  October.  grew  a  occupations,  in  in  by B y r o n t h a t t h i s  impact  by  analysis  statistical  5933  labour  Assuming  unemployed  conclude in  the  t h e r e must have been, i t i s m a n i f e s t i n g  than  bring  to  employment  been a b l e t o answer, an to  up  George  relatively  out  f o r other  unemployment  have  economy d e s p i t e s u g g e s t i o n s  to  is  employment.  total  July  Prince  force  show  the  in  waited  process  should  In  strike  have  alternative  strike  numbers.  after  seeking  the  labour  would  t h r e e month l a g i n t h e a d j u s t m e n t the  Manpower  employment.  t h a t would  i n other were f o u n d  fluctuations l e a d to sharp  industries. and  that  The  some o f  without  the even  increases fact the  that r  or no  values  are  moderately high  that  the  industry, variable. in  part  that  has  been  However, again  and  i n the  (the +0.5  i s tied  to the i n c r e a s i n g  earnings, period  economy  to high  i n with assumed  numbers  of  The  range) i n d i c a t e s  conditions  here  to  i n the  be  i t must be cautioned  unemployment. number  to +0.8  the  forest  independent  that t h i s  i s due  through  time  i n employment,  increase  over  the four  unemployed  i n the  central  year  interior  i n d i c a t e s t h a t i t i s a t t r a c t i n g and producing more people who are unable to g a i n or hold region.  This  employment, yet they s t i l l  remain i n the  i s of p a r t i c u l a r importance because i t emphasizes  the need to i n v e s t i g a t e with care  a l l aspects of development i n  the f o r e s t i n d u s t r y and i t s impact on the r e g i o n a l  economy.  95 CHAPTER 4 Footnotes 1.  Both the employment and earnings data were compiled and s u p p l i e d by David R i c e , Research E d i t o r of Labour Research B u l l e t i n ( V i c t o r i a : Research and P l a n n i n g Branch, M i n i s t r y of Labour, P r o v i n c e of B r i t i s h Columbia). They are d e r i v e d from the monthly Labour Force Survey (Cat. 72-002) p u b l i s h e d by S t a t i s t i c s Canada.  2.  The "ABC" B r i t i s h Columbia Book, 1973 e d i t i o n .  3.  Peter H. Pearse, Timber Rights and F o r e s t P o l i c y i n B r i t i s h Columbia ( V i c t o r i a : Report of the Royal Commission on F o r e s t Resources, September, 1976), Volume 1, p. 231.  4.  I b i d . , p.  5.  Labour Force Survey,  6.  The unemployment data were s u p p l i e d by Mr. Rod Smelser, Economist, Canada Manpower and Immigration O f f i c e , P r i n c e George, B.C.  7.  Ronald N. Byron, Community S t a b i l i t y and Regional Economic Development: The Role of F o r e s t P o l i c y i n the North C e n t r a l Interior of B r i t i s h Columbia (Unpublished PhD. Thesis, F a c u l t y of F o r e s t r y , U n i v e r s i t y of B r i t i s h Columbia, 1976), p. 110.  8.  I b i d . , p.  116.  9.  I b i d . , p.  119.  Lumber Trade D i r e c t o r y  and  Year  232. op.cit.  10. These f i g u r e s are f o r the P r i n c e George and Quesnel Manpower Regions o n l y . The W i l l i a m s Lake Manpower Region was excluded from the a n a l y s i s of the pulp and paper s t r i k e because the area has no employment i n t h i s i n d u s t r y .  96 CHAPTER 5 CONCLUSIONS  As was exists  pointed  a need  out i n the i n t r o d u c t i o n t o t h i s  to better  processes of regions to a d e q u a t e l y that the  there  plan  i s not a great  analytical  analysis  level,  techniques  aspects has  interrelationships encompassing interior,  forest-related Analysis industry  those the  of  the  railway  intense  vertical  processing even  greater  application the  this  strength  the  economic  structures.  The  evidence  of  the  economic  some  of  t h e most  Base  of  the  forest  profound  by f o c u s s i n g  on  impact, such  as  This  integration services of  upon  the l o c a t i o n a l p a t t e r n  change.  associated  sector  well-being.  growth i n the r e g i o n  had  the  are  development  i t has a f f e c t e d  dependency  of  some o f t h e more  dependent  concentration  o f Economic  certain  which  c o m m u n i t i e s and areas, o f t h e Given  extract  industries  horizontal  i n d u s t r i e s and  to apply  i n the c e n t r a l  technological  and  a v a i l a b l e at  employment  industrial  and  data  Granted  of the basic  historical  system  and  industry,  of  have  and  produce  for their  which  trends.  possible  local  activity the  structures  forest  the nonbasic  and  factors  caused  to  d e m o n s t r a t e d how  of p o p u l a t i o n  data  and  able  the m a j o r i t y  and  o f economic  i t is still  to that  there  i n B r i t i s h Columbia i n order  to i n d u s t r i a l  amount  of regional  been  t h e economic  and c o m m u n i t i e s  f o r and a d j u s t  subprovincial  salient  understand  study,  of  which  development  has  l e d to  the  wood  i n turn within  a  has few  region. upon  the  Analysis  has  relationship,  forest been an  industry, able  to  undertaking  the  suggest that  p r o d u c e d an employment m u l t i p l i e r  o f 2.13, a n d h a s a l s o  provided  a r i g o r o u s e x a m i n a t i o n o f t h e v a l i d i t y o f s e v e r a l f o r m s o f E.B.A. Despite  the shortcomings  common t o a l m o s t useful  tools  of the techniques,  any form  in  of a n a l y s i s , they  uncovering  some  a problem have  features  of  that i s  proved the  t o be  economic  s t r u c t u r e s w i t h i n t h e c o m m u n i t i e s and r e g i o n , i n c l u d i n g t h e s i z e s of  the basic-nonbasic  correlations  (although  f o r c e , a n d M.R.  to completely  analysts  of  study.  explanations  through  as  the system  labour  employment,  earnings,  reveal  and  exercise.  It  some o f t h e i n t e r r e l a t i o n s h i p s  s e c t o r s w h i c h h a v e been f o u n d o r i n f e r r e d  This  the i n t e r i n d u s t r i a l  easy  of  i n v e s t i g a t i n g other  throughout t h i s  induced  between p o p u l a t i o n ,  i n some ways a f r u s t r a t i n g  between t h e i n d u s t r i a l by  and s t a t i s t i c a l l y  multipliers.  analysis  unemployment h a s been  forces  not a l l strong)  a n d L.Q.  Statistical  was u n a b l e  labour  regions  and t h a t w e r e h i n t e d a t  i s an i n d i c a t i o n o f t h e  l i n k a g e s w h i c h do n o t l e n d they  and  impact  with  in a  wide  complexity  themselves to  variety  d i f f e r e n t speeds  and  of  ways  degrees  of  intensity. The  analysis  significant exhibits  has  findings. surprising  fluctuations  in  the  been The  successful nonbasic  resilience basic  i n producing  sector  to  industry  of  the  short-term despite  several economy  employment the  ultimate  d e p e n d e n c e o f t h e n o n b a s i c i n d u s t r y upon f o r e s t - r e l a t e d a c t i v i t y . The  s t r u c t u r e s o f r e s o u r c e - b a s e d economies a r e o f t e n regarded as  fragile basic sector  and t h e r e f o r e  industry. must  highly s e n s i t i v e to conditions within the  The i m p l i c a t i o n h e r e i s t h a t w h i l e  eventually  react  to long  term  trends  the nonbasic i n the forest  98 industry, can  over  the short  r u n i t i s n o t showing  be measured by employment g a i n s o r l o s s e s .  economy o f t h e c e n t r a l i n t e r i o r while  one c a n n o t  single aids  sight  i n d u s t r y dependent  i n slowing  point  lose  where  progress  short-term  the  study  reveal  effects. along  system. also  given  unemployment  found  that  In t h i s growing  development  i s readily exhibited.  findings they and  i s often  the  produce  a s many  answer.  This  weaknesses  results  that  of  there  case  study  Of  greatest  linkages  which  existing  data.  central  data  to  interact,  allow  increase i n  basic-nonbasic  with  analyses  of  this  type,  of  areas  analysis of  as  well  investigation  as  their  which a r e  research. i s the complexity hidden field  of  the  a s were measured survey  comprehension  through technique.  time  industrial here  of industries  of  when  using i n the  indicated  consuming p r o j e c t , might produce  particularly  the  i n a p p r a i s i n g the strengths  f o r better  appropriate analytical  an  to  has found  intensive  and t i m e  careful  development  and  i n t e r i o r , which p r e l i m i n a r y i n v e s t i g a t i o n  an e x p e n s i v e  be  and  f o r f u t u r e c o n s i d e r a t i o n as  have r e m a i n e d An  data  questions  a r e some  concern  they  i s actually a lesser rate of real  t h e methods  perhaps worthy o f f u r t h e r  must  was  population  the net r e s u l t  than  there  to the  out as  unemployment there  a  o f t h e system  industries  o f economic  case  that,  i t i s basically  t o smooth  Through  to a l l aspects  with  tend  employment, t h u s  As  that  the complexity  fluctuations  the  consideration hidden  sufficiently  down r e a c t i o n s by t h e n o n b a s i c  through  analysis,  region,  that  I t may be t h a t t h e  has p r o g r e s s e d  of the f a c t  a reaction  how  sufficient  the  coupled  t o be  sectors  with  the  The theory this  basic-nonbasic  and  i t may  direction  clearer  be  with  The  taking  a more of  has i t s r o o t s the concept  spatial  the  in central  approach  relationships  further could  by  i t s usefulness  research.  I t would  perhaps  even r e f i n e ,  another  region based  result  in  in a  location,  population.  technique  However,  place  along  between  use o f Economic Base A n a l y s i s , a l t h o u g h  outdated  resource  that  explanation  employment, and  concept  be  some can  analysts only  be  a worthwhile  dismissed  recently,  proven  through  undertaking  one o r more o f t h e t e c h n i q u e s  similar  to the c e n t r a l  economy, s u c h  as mining  has  interior.  as an merit.  empirical  to apply,  and  o f E.B.A. t o A  different  o r o i l and g a s , c o u l d  c h o s e n t o d e t e r m i n e i f s i m i l a r r e l a t i o n s h i p s and p a t t e r n s  be  emerge.  100  BIBLIOGRAPHY  "ABC"  B r i t i s h C o l u m b i a Lumber T r a d e D i r e c t o r y and Y e a r Book, The ( V a n c o u v e r : P r o g r e s s P u b l i s h i n g Company).  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