146 



THE OUTLOOK FOR TIMBER IN THE UNITED STATES 



Manufacturing activity. — Future changes in man- 

 ufacturing — a major wood-using sector of the 

 U.S. economy — will also be important in deter- 

 mining the demand for some timber products. 

 In the past several decades the index of manu- 

 facturing production published by the Federal 

 Reserve Board, 10 has shown a fairly consistent 

 upward trend, and close relationship to changes 

 in the gross national product (figs. 53 and 54). 



The medium projections based on the historical 

 trends and relationships show an increase in manu- 

 facturing production by 2000 to about 3.2 times 

 the 1970 level. 



Rates of growth in projections of manufacturing 

 production, and in construction activity dis- 

 cussed later in this chapter, decline over the 

 projection period. Transportation, trade, and 

 other services account for a growing share of the 

 projected gross national product, a? in the past. 

 In the period 1950-68, for example, the portion 

 of the gross national product originating in these 

 sectors rose from 46.5 to 49.6 percent. 



The projections of manufacturing activity and 

 construction adopted in this study rest on ihe 

 assumption that the U.S. economy will continue 

 to be oriented largely to production of ecoDomic 

 goods, and that adequate supplies of raw materials 

 and energy sources will be available to support 

 such sustained growth over the next three decades. 



Both of these assumptions are being increasingly 

 challenged, 11 and for the longrun it is difficult 

 to conceive of an indefinite continuation of high 

 geometric growth rates. Also, concern over 

 environmental factors could affect the types of 

 goods produced, rates of productivity in manu- 

 facturing, and rates of increase in gross national 

 product. For the projection period used in this 

 study, however, it was assumed that the economic 

 growth assumptions adopted provide an acceptable 

 basis for evaluation of potential timber demands. 



Technological and Institutional Assumptions 



Institutional and technological changes in the 

 U.S. economy have substantially influenced use of 

 different raw materials. Some of these changes such 

 as increasing urbanization, with resulting impacts 

 on building heights and fire codes, for example, 

 have led to partial displacement of timber products 

 in construction. Technological developments in 



Index of manufacturing production 

 1920 - 70, with projections to 2000 



10 Federal Reserve Board. Federal Reserve Bulletin. 

 Washington, D.C. Monthly. This index measures changes 

 in the physical volume or quantity of output in manu- 

 facturing industries. 



11 See for example : Commoner, Barry. The closing 

 circle. Alfred A. Knopf. 1971; Meadows, Donella H., 

 Dennis L. Meadows, Jorgen Randus, and William W. 

 Behrens. The limits of growth. Universe Books, New 

 York. 1972. 



1950 1960 



Figure 53 



1980 



Index of manufacturing production in relation 

 to gross national product, 1920 - 70 



100 200 300 400 500 600 700 800 



GROSS NATIONAL PRODUCT (BILLIONS OF 1967 DOLLARS! 



Figure 54 



industries producing metals and plastics have also 

 resulted in displacement of lumber and plywood in 

 products such as furniture and containers. 



On the other hand, new technology has simul- 

 taneously led to large increases in the use of 

 lumber in pallets, greater use of plywood in con- 

 struction, and use of pulp and paper, plywood, 

 hardboard, and particleboard in a wide assortment 

 of end uses. 



In the following sections of this chapter, projec- 

 tions of demand for some products such as furni- 

 ture have been adjusted for specific technological 

 changes that appear to be in prospect. For other 

 products, such as pulp and paper, use of historical 

 data as a base for projections implicitly assumes 

 a continuing stream of technological and institu- 

 tional changes such as have occurred in the past, 

 as well as other variables such as educational levels, 

 capital availability, and military activities. 



