Does Wood Industry Win With Obama?

Analysis and opinion Bill Esler | Posted: 11/07/2012 12:07AM

 

Building and construction markets are already in recovery, and the post-Sandy reconstruction plans are starting. How will Barack Obama's election impact the cabinetry, furniture and other wood manufacturing segments?

Healthcare, education, trade, and the environment all have felt the impacts of Obama's first term - not every area positively and certainly not equally. Housing is the one that most directly affects the secondary wood markets: flooring, windows, furniture, cabinetry are the key industries affected.

Sluggish housing recovery had devastating effects, but without question housing is on the mend. Status quo in housing for a second Obama administration means housing recovery will stay the course - driven more by the natural market recovery than by government intervention. But a better plan is called for in unsticking the financial bottleneck for full recovery.

"Making sure creditworthy consumers and small businesses can get mortgages and loans, tackling housing finance reform in a responsible manner and resolving the foreclosure crisis are vital to spur job growth and strengthen the housing and economic recovery," according to Barry Rutenberg, chairman of the National Association of Home Builders. We agree.

In health care, the voters and the Supreme Court made the choice - Obamacare remains in force. It impacts individuals and small businsses directly - many small businesses will see it as financially burdensome, there may be an unanticipated upside, in the availability of workers.

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Many people stay in jobs they don't want because of trepidation about leaving their existing health insurance. The certainty that you can be covered seamlessly regardless of employer  may mean workers will be able to move more readily to take a new position. This "liquidity of human capital" is just as essential as the availability of the regular kind that the home builders call for.

During the campaign and in the years leading up to it, President Obama engaged the wood manufacturing industries with surprising frequency - but his administration may not have recognized that pattern. When looking for factories to visit, or manufacturers to council with, wood manufacturing companies frequently appeared on camera. Why?

Because wood production is so pervasive in the fabric of American business. We've got a lot of forests, a lot of homes and businesses to build and furnish, and a lot of customers around the world for our wood.

Establishing a rational industrial policy is a critical need.

How do we get there? The essentials for an industrial policy are cohesive plans to attain identified goals, supported by cohesive and integated policies on trade, education, environment and finance that will get us there.

If we had a national goal to export more value-added products, we might see exports dominated by  manufactured panel, wood trusses, doors, furniture, etc. heading abroad - or at least lumber rather than logs. In this area Canada out-performs the U.S.

Education is a key concern for wood manufacturing industries. As the market recovers and shops and plants fire up, the need for skilled workers will rise. The U.S. education system is not delivering enough candidates with essential skills that can be trained rapidly in on the job in wood production.

In the campaign bullet points, the Obama administration notes it has "invested $2 billion in community colleges and proposed forging new partnerships between community colleges and employers to train 2 million workers for jobs that already exist."

We need more and better. In the U.K., government-sponsored apprenticeships were just doubled to 900,000. We need something comparable.

The Federal response to Hurricane Sandy will be a long-term test of Obama's second term. Related posts:

JWH Cabinetry Fields Hurricane Sandy Inquiries and Bids

U.S. Forest Service Dispatches Teams to Clean Up Sandy's Mess

Wood Safety Post  Post-Hurricane Tips from Underwriters Lab

The final days of the presidential campaign were derailed by Hurricane Sandy, which put to a test the ability of the Federal Emergency Management Agency (FEMA) to handle a natural disaster, and the ensuring housing crisis. Estimates are 40,000 new homes will be needed.

FEMA money will flood into New Jersey, New York and other affected areas. Already $158 million in assistance has been approved by FEMA for 182,000 people - less than $1,000 each - obviously billions of dollars will be needed as we address the huge financial need for reconstruction of homes.

 

About the Author

Bill Esler woodworkingnetwork.com

Bill Esler

Bill Esler, Associate Publisher/ Editor in Chief, Woodworking Network Bill is responsible for editing Custom Woodworking Business and coordinating content for Wood Products , CLOSETS , WoodworkingNetwork.com, and related newsletters. Bill’s expertise includes using innovative print manufacturing techniques to grow audience engagement, digital printing, purls, QR codes; and lead-generating webcasts, custom websites, and custom digital and print content. Read Bill Esler's woodworking blogs. He can be reached at besler@woodworkingnetwork.com or follow him on Google+.

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