Stacked lumber at Winton Global. (Citizen photo by Brent Braaten)

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as companies cut shifts, reduce work weeks and in some cases, shut down entire mills. More than 3,000 jobs have been impacted in Prince George, and north, west and east of the city, according to a tabulation by The Citizen. The estimated losses include both manufacturing and logging and hauling jobs. Another 1,100 workers are off the job in the Cariboo from one company alone, Tolko.

Some players are confident they will survive the downturn, others less so.

Most say they are in survival mode.

Whether mills survive will have considerable ramifications for communities, particularly smaller, forest-based towns.

There have already been some casualties in the past 18 months.

Canfor permanently closed one of its two sawmills in Mackenzie last summer, a loss of 130 jobs. In late 2006, McBride Forest Industries went bankrupt, a loss of 60 jobs, and last year, Gateway Forest Products in Prince George also succumbed to bankruptcy proceedings, a loss of about 50 jobs.

AbitibiBowater idled a newsprint mill in Mackenzie, which employed 240 people, and it's not expected to resume operations.

There's another growing list of mills which have been shut down indefinitely: Two AbitibiBowater sawmills in Mackenzie, with a workforce of 240 people, Canfor's sawmill in Chetwynd, a loss of 188 jobs, a Canfor oriented strand board plant in Fort Nelson, a hit of 235 jobs, and West Fraser's sawmill in Terrace, a loss of another 100 jobs.

Winton Global's sawmill in Prince George -- which already took a three-month shutdown -- will go down indefinitely again this summer, putting 220 workers off the job.

In Fort St. James, Stuart Lake Lumber has been down since last summer, a loss of 85 jobs, and Pope & Talbot's sawmill has been shutdown since mid-October caught up in the market downturn but also in the company's bankruptcy proceedings. That's a hit of another 300 jobs.

There is a question mark against all of these mills, particularly as the downturn, a result of a severe collapse in the U.S. housing market, is expected to continue for the next 12 to 18 months.

Workers are left waiting and wondering.

John Wilson, a 30-year veteran worker at the Pope & Talbot sawmill, which was previously owned by Canfor, recently was called back to work to help clean up inventory at the mill, a standard practice when new owners take over. The plant was just sold to Indonesia-based Sinarmas, which is expected to take over in early April.

There's some speculation the new owners will open the mill on one shift. "But nobody knows anything of what's going on," said Wilson.

Quite a few people have left town in search of work, and Wilson said he's concerned there won't be enough skilled maintenance people -- like millwrights and electricians -- if and when the mill resumes production.

Still, the fact the mill has been bought is encouraging. Analysts believe the mill was bought to shore up chip supply for the Mackenzie pulp mills, which Sinarmas also purchased. Sinarmas is a major global pulp and paper producer.

"I don't know if it's optimism -- cautious optimism if anything," said Wilson.

So far, the job reductions have been slow to show up in the unemployment numbers.

In February, the unemployment rate in Prince George increased slightly to 5.6 per cent, up from 5.1 per cent the month before, but lower than 5.8 per cent a year ago.

For the Cariboo region, which includes Mackenzie, the unemployment rate rose to 5.8 per cent, up from 5.2 per cent the month before and up from 5.3 per cent the year before.

United Steelworkers local 1-424 president Frank Everitt said he believes a lot of off-the-job workers are collecting Employment Insurance benefits and waiting to see what happens in the next six months.

Companies in northern B.C. have been reacting to an array of negative forces: low prices from the collapse in the U.S. housing market, a high Canadian dollar that erodes income on lumber sold in the U.S. and a 15-per-cent export tax on lumber shipments to the U.S.

The data and forecasts early this year continue to be stark in the U.S.

U.S. housing starts have tumbled from a high of more than two million in 2005, to about half of that.

The consensus among analysts is that there will be little improvement in 2008. "Without any optimism it's hard to believe it will change in any significant way," says Paul Quinn, a forest industry analyst with Salman Partners in Vancouver.

It's quite possible that more mills will be closed permanently, but it's hard to tell because the details of the balance sheets of privately-held companies is not known, observed Quinn.

Canfor alone has shed about 1,000 jobs in the North as a result of its shut downs.

The company has been trying to stop the bleeding, but still recorded a loss of $360 million in 2007.

During a recent conference call with analysts and reporters, Canfor president and CEO Jim Shepard said the management team was moving very deliberately with "prudent haste" to get costs down given the profound impacts the decisions have on communities. "We're bringing our costs down but the market is dropping faster than our ability to get our costs down," he said. "This is a situation I've never witnessed before and I don't think, in speaking with my colleagues in the industry, they have ever witnessed any thing like it either. We're dealing with a tsunami here, quite frankly."

Even West Fraser -- a perennial moneymaker -- posted a loss of $34 million in 2007.

In a rare move the company also went public with a slate of shift reductions in Smithers, Houston and 100 Mile House.

Carrier Lumber president Bill Kordyban says a big problem -- and a difference from previous downturns -- is there appears to be no end in sight.

Kordyban is particularly concerned with the tightened credit situation in the U.S., as the pendulum swings in reaction to the problems incurred from the sub-prime mortgage crisis.

Carrier Lumber remains running on two shifts, but they are watching the situation very carefully, he said. Cheslatta Forest Products, which Carrier Lumber is a partner in, has been down since the fall. Another partnership mill, West Chilcotin Forest Products, is operating on one shift.

"We certainly will endeavour to survive, and I think that's truly what we're into now, is survival mode," said Kordyban. "We've been here a long time. I was handed down a legacy from my dad that I want to act as a steward on, and continue, so I'm going to do my utmost to survive this situation," he added.

Mike Robertson, an official with the Cheslatta First Nation, a partner in the Cheslatta sawmill south of Burns Lake, said it's been a tough year, particularly for the 100 or so mill workers, loggers and truckers impacted by the shutdown. "We're not shaking in our boots, but we're concerned," he said.

Still, Robertson maintains an optimistic outlook, saying the market will turn around eventually, and noting the mill is in a good position, as it can also tap into submerged timber in Ootsa Lake. The timber was flooded as part of the Nechako reservoir, and there's an estimated 10 million cubic metres available to the band.

The mill is also partnering with an energy company with a proposal to produce electricity from wood waste, both to supply power to the mill and to the B.C. Hydro grid.

The diversification will enhance the business model of the mill, says Robertson.

Dunkley Lumber, considered a top-notch operator, has downsized its planer operation and is moving to a three-day work week.

And despite the downturn, the company continues to make improvements at the mill with additional sorting and trimming capacity.

"We know we will weather the storm. We will probably be a little bruised and a bit beaten up," noted Dunkley manager Blair Mayes. "We might also be a bit wiser in our management styles and practices," he said.

Dunkley is also trying to maintain its workforce, which Mayes compliments as being outstanding, but unfortunately paying the price for external factors.

Vanderhoof Specialty Wood Products is running at about 60 per cent capacity, and in co-owner Paul Heit's words, trying to hang in there.

"We're optimistic we will survive, but who the hell knows," he said. "It depends on how long this lasts."

T'loh Forest Products in Fort St. James has also moved to a three-day work week. "We're just trying to keep our people, keep them employed, provide them something," said manager Laura Chernowski.

Brink Forest Products is also operating at a reduced capacity of 60 per cent, which has cut the workforce by about 50 people in Prince George.

Company president John Brink says they are in survival mode.

But he says the market is not his biggest problem, but access to raw materials. Brink says he simply cannot get access to enough blocks and low-grade lumber, a battle he's been having for more than three decades.

He says that forest policy changes have removed any incentives for primary lumber producers to interact with secondary manufacturers, which has exacerbated the impacts of the downturn.

Brink says it makes him want to think about calling it quits.

Job Impact of forestry downturn

Fort Nelson

Canfor -- OSB plant to go down this summer indefinitely, 235 jobs. Had already reduced workforce by 100 at OSB plant and plywood plant earlier.

Chetwynd

Canfor -- Sawmill to close indefinitely, 188 workers.

Mackenzie

Canfor -- Shuts one of two sawmills last summer permanently, 130 jobs cut. Before new year, another 75 jobs cut when third shift at second sawmill eliminated.

AbitibiBowater -- Shuts down its two sawmills indefinitely, and a newsprint mill, which is not expected to restart -- job loss is 550.

East Fraser Fiber -- Dropped a shift, down 40 jobs.

Fort St. James

Stuart Lake Lumber -- Sawmill goes down last May, the planer two months later -- 85 jobs lost.

Pope & Talbot -- Down since mid-October, impact on 300 workers. Bought recently by Indonesia-based Sinarmas Group, but unclear when, or if, mill will restart.

T'loh Forest Products -- Have moved to a three-day work week, 20 job equivalent job reduction.

McBride

McBride Forest Industries -- Goes bankrupt in the fall of 2006, about 60 jobs.

Valemount

Carrier Lumber buys the lumber plant in 2006, but has not re-opened it yet, 120 jobs.

Prince George

Dunkley Lumber has reduced shifts at planer mill and moves to three-day work week at sawmill on Monday -- about 60 jobs reduced. Lakeland Mills moves to four-day work week -- about 25 job reduction.

Winton Global -- was down for three months, will run for three months, then shutting indefinitely, likely in July, 220 jobs. Also already cut third shift last summer, about 80 jobs

Canfor has cut shifts at Rustad Bros., Polar and Clear Lake -- about 225 jobs

Brink Forest Products -- operating about 60 per cent capacity -- down 50 jobs.

Gateway Forest Products -- goes bankrupt last spring, loss of 50 jobs.

Vanderhoof

Canfor -- Plateau sawmill drop to two shifts. Loss of 40 jobs.

Vanderhoof Specialty Wood Products -- operating at about 60 per cent, employ 90 people including in trucking outfit.

Burns Lake

Hampton Affiliates -- 40 per cent production cut at Babine Forest Products and Decker Lake, moving to three-day work week, hit to 120 jobs equivalent.

Cheslatta Forest Products -- Mill has been down mostly since the fall, 65 jobs. Just starting sawmill again to run through log inventory.

Houston

Canfor - Down to two shifts, loss of about 40 jobs.

West Fraser - Pre-christmas graveyard shift cut is made indefinite, about 70 jobs.

Smithers

West Fraser -- Graveyard shift for six weeks, 25 workers off the job until the end of March.

Terrace

West Fraser -- indefinite closure of sawmill, about 100 jobs.

TALLY

- 2,885 indefinite or permanent manufacturing jobs losses when Winton Global goes down in the summer.

- In discussions with Central Interior Logging Association, estimate an impact of at least 500 equivalent job losses in logging and trucking.

TOTAL

3,385 jobs

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