How does the forest industry contribute to Canada’s economy?

The forest industry is one of Canada’s most important manufacturing sectors.

The forest industry:

  • employed about 209,940 people across the country (2017), including an estimated 11,565 Indigenous employees (2016)
  • accounted for about 7.2% of Canada’s total exports in 2017
  • generated more than $1.4 billion in revenue for provincial and territorial governments in 2016
  • contributed roughly $24.6 billion to Canada’s economy in 2017

The forest industry represents a smaller percentage of Canada’s economy than other resource sectors, but it creates more jobs and contributes more to the balance of trade for every dollar of value added than do other major resource sectors.

More than lumber and pulp and paper

The heart of the Canadian forest sector is traditional forest products, including lumber, other solid wood products, pulp and paper and activities such as forest management and logging. However, with Canada’s commitment to clean technology and the transition to a low-carbon economy, non-traditional forest products, such as advanced bioproducts, are growing in importance.

Exports of Canadian forest products (2017)
Infographic of exports of Canadian forest products by product category in 2017, showing: (1) 29% softwood lumber, (2) 23% wood pulp, (3) 7% structural wood panels, (4) 6% printing and writing paper, (5) 6% newsprint, (6) 29% other (includes over 400 categories of products).

An economic engine from coast to coast

Forest operations take place in all regions of Canada except the Far North. Of the total forest industry jobs in Canada:

  • 52% are in Ontario and Quebec
  • 39% are in Western Canada and the Prairies (with the vast majority in British Columbia)
  • 9% are in Atlantic Canada

The Canadian forest industry is a major employer nationwide, but its economic contributions are particularly important in many rural and Indigenous communities, where forest-related work is often the main source of income. In these communities, forestry jobs are crucial to ensuring economic sustainability.

Increased export markets

Globalization is increasing trade possibilities beyond Canadian producers’ traditional markets. The US market has long been the main importer of Canadian forest products; however, the impact of the US housing crash and global financial crisis that began in 2008 spurred Canadian producers to expand to other markets. Exports to Asian markets, mainly China, have risen sharply over the past decade and helped increase the robustness of this trade-dependent sector.

Sources and information
  • National Forestry Database. Revenues, Table 8.1 Statement of revenues from the sale of timber from provincial Crown land, by jurisdiction (accessed July 3, 2018).
  • Statistics Canada. CANSIM table 383-0031: Labour statistics consistent with the System of National Accounts (SNA), by province and territory, job category and North American Industry Classification System (NAICS) (accessed May 23, 2018).
  • Statistics Canada. 2016 Census of Population (special extraction, April 20, 2018).
    • Natural Resources Canada–Canadian Forest Service calculations are based on Statistics Canada, 2016 Census of Population.
    • Indigenous employment data from Statistics Canada’s 2016 Census of Population:
      • These values refer to the number of people “employed,” not “in the labour force,” which includes those “unemployed.”
      • “Indigenous” refers to persons who are First Nations (North American Indian), Métis or Inuk (Inuit) and/or those who are Registered or Treaty Indians (that is, registered under the Indian Act), and/or those who have membership in a First Nation or Indian band.
  • Statistics Canada. Merchandise trade data, monthly data (special extraction, April 25, 2018).
    • Natural Resources Canada–Canadian Forest Service’s calculations for 2017 nominal GDP are based on Statistics Canada’s tables 379-0031, 329-0077 and 329-0074: GDP in 2007 constant prices, and estimated industry price deflators.
    • The classification of the exports of forest products is determined by the international Harmonized Sales codes. The further breakdown of these products is consistent with the nomenclature used in the Food and Agriculture Organization of the United Nations Joint Forest Sector Questionnaire.
    • “Other” includes approximately 415 different product categories.