Since 1967, Boise Cascade facilities in Stevens County have produced the wood products needed to help build homes and buildings throughout the United States. The tradition of being a high-efficiency producer of certain products, like plywood, has helped the company gain a foothold in a niche market, according to Region Manager RJ Glover.
Glover spoke at a Colville Chamber of Commerce meeting in June about the current status of the Boise facilities in Stevens County and some of the successes and challenges of the wood products enterprises.
“Over the last decade, Boise Cascade has changed from being a wood products business to being an office supply company and selling their timberlands back to a company that doesn’t have the paper. What we have today is a wood products and manufacturing company that has 21 manufacturing facilities and 33 lumber distribution sites,” said Glover.
Last year the Boise Cascade company, which also has plants in Oregon, Georgia and Alabama, generated $1.2 billion in sales. The Kettle Falls facilities earned $137 million of that total, accounting for 10 percent of the company.
Boise Cascade is the second largest employer in the Stevens County area behind Providence Healthcare, employing 380 people. Glover said those jobs translate into $25 million in wages and benefits in Stevens County. However, Glover noted the economic impact goes beyond just the jobs themselves.
“We employ 380 people and for every person we employ there is another 2.81 in the community that are employed because of our plant—log truck drivers, service technicians, a lot of supporting jobs in the community linked to 300 employees,” he said. “If I was in Seattle and you took away 300 jobs, it wouldn’t have a big effect on the community but in Colville or Kettle to take away 300 jobs would have a big impact.”
The three site locations, two in Kettle Falls and one in Arden, specialize in producing plywood and cut pine boards.
“At the Kettle Falls plywood plant, we employ 200 people and we sell plywood for roofs, houses, and commercial buildings. We are one of the lowest-cost producers of plywood. Our lumber plant employs 135 people and supplies cuts pine boards to Home Depot as well as users like Pella windows and doors,” said Glover.
While some may anticipate seeing Boise products at local hardware stores or in nearby Spokane, Glover said the distribution system is a bit more complicated.
“At our plywood plant, for instance, we generate 16,000 pieces of 4×8 plywood every day. A lot of product goes to Chicago by rail and ends up in New England/Northwest area. You are more likely to find Kettle Falls plywood in New England than we have it here,” Glover related.
While the Boise facilities may be efficient with solid buyers, the somewhat sporadic demand influenced by the housing market can pose real challenges to the company.
“There are some things going on that are shifting our business. It takes wood to build houses and we need 1.5 million housing starts in this country every year to stay even. Since the downturn, the housing demand is not back to a sustainable level. More kids are moving back in with their parents, we are seeing a consolidation of families into one home or an increase of multiple family housing,” said Glover. “For whatever reason, people are not willing to take that commitment to buy a home.”
As more people opt for living arrangements with less commitment, like apartments, Glover said the wood products industry feels the pinch.
“The average house being built today is 2,632 square feet. Apartments are 1,000 square feet on average, so the lumber demand for apartments is significantly less. Although housing starts are going up it’s not the same,” he said.
One of the factors that may discourage young people in particular from buying a home is student loan debt, said Glover.
“The student loan and college costs are a deterrent to taking on other debt obligations. Forty percent of people ages 18-31 have student loan debt. When the economy shrinks and unemployment rises, you can’t get a job so you go to school and then when you graduate school there still isn’t a job so you stay and go to graduate school and eventually someone has to pay for all that,” Glover explained. “One-third of that age group is 90 days delinquent on their student loans and seventy percent of the class of 2016 will have an average of $36,000 loan debt.”
While Boise works to weather a capricious lumber market, the company is also having to address new challenges in recruiting and retaining employees.
“They say unemployment is at 4.7 percent but that means the people looking for jobs has dropped. There are 16-to-24 year olds not looking for jobs. These are the people who stimulate the economy, buy the houses and have consumer spending, so when they aren’t working, the economy can’t grow,” said Glover. “The most frustrating thing to me is that I can’t hire anybody and I am tired of people who say they can’t find a job.”
Glover said Boise is experiencing constant turnover in hourly wage jobs.
“We offer summer jobs to students that ask them to do things like drive the water truck to keep the dust down. This job pays $17-$18 an hour. But they would rather work 20 hours at a pizza shop for half the money,” said Glover. “More people are willing to work Monday to Friday than work a full-time job with benefits. It’s a shift in the value system that, right or wrong, we are seeing in the workplace.”
Glover said recruiting college-educated workers to the area is also a challenge.
“We have a difficult time in recruiting a college educated workforce,” Glover said. “One of the issues, in my opinion, is a lack of social life. If I’m 23 and move to Kettle Falls, it is a tough community to break into a social network. For some of our hires, as much as they thought they liked hunting and fishing they are sitting at home alone.”
Many local students do not consider coming back to Stevens County after college; a trend that Glover said can be tied to a “disconnect” with local schools.
“We have a disconnect with our local schools. There is not one person from our summer hires that have ever raised their hand to say they have a desire to move back to Kettle Falls and would like to be a supervisor or an engineer at Boise,” he related. “We cannot graduate a student from our local schools that is convinced they want to live in Kettle Falls and be an engineer. We are graduating people who have a desire not to do anything or to leave and never come back. Our management trainees make $55,000. They make the same amount if they go work in Seattle. It’s not a money issue, there is a huge disconnect.”
By Jamie Henneman/The Independent Staff