Clarky's Comment - June 2011

This month I want to comment on labour supply for planting. Each year we cope with about 40,000 ha of replanting nationally without too much difficulty. Last year we added about 6,000 ha of new planting and this year I'm anticipating that will be greater – perhaps 10,000 ha based on an extrapolation of PF Olsen new planting levels. At that level we are already starting to see signs of labour shortage. This is manifesting in a mix of labour cost increases and lower average productivity per person as new recruits, not hardened to the physical demands of planting trees on steep and/or cutover impeded land, plant fewer trees/day.

Most readers will recall when New Zealand was planting in excess of 60,000 ha/annum in the mid-1990s, peaking at 98,000 ha in 1994. So what has changed to make labour supply more challenging now?

First and foremost, the new planting is not accompanied by as much pruning and thinning activity. Most of the mid-1990s planting was intensively managed to maximise clear wood production. Pruning has declined as the margin between pruned and unpruned log values has narrowed at the same time that pruning labour costs have been rising i.e. the business case for pruning has weakened and reduced the number of sites where pruning is considered viable. Most new forests are being established with carbon as an income stream. Our expectation is that only a small portion of this new estate will be pruned, and stockings will be held higher, suggesting just one thinning. Labour engaged for most of the year on thinning and pruning provided the backbone of the planting labour during the mid-1990s and ever since.

The second change over the last 15 years or so has been that young people have much more variety of jobs on offer and appear less inclined towards manual labour jobs; especially those that require early starts on frosty mornings and long travel to get to the job! Forestry is not alone in the primary sectors in facing shortages of workers. The dairy industry has embarked on a number of initiatives, including TV advertising to attract recruits, while horticulture and viticulture has made the most of immigrant labour.

So is there a problem emerging, and if so what are the solutions?

As long as new planting levels out at around 10,000 ha/annum the situation is manageable through redeployment of labour engaged on thinning and pruning. But should new planting get to 20,000 – 30,000 ha/annum in response to better clarity on the international carbon regime we can anticipate significant inflation in planting labour costs as we compete to attract labour from other sectors over a three-month winter planting season. Some potential solutions are:

  1. Containerised planting stock. Containerised seedlings or cuttings can extend the planting season by reducing the planting shock and potential losses from a dry spell immediately after transplant. Their benefits are more apparent in cutover replanting than on grassland where grass competition can quickly swamp the typically smaller plants. They are particularly useful for sandy soils where moisture stress is a major source of seedling loss and growth variability with bareroot treestocks.
  2. Immigrant labour. Some contractors already engage immigrant labour. But given that planting requires a degree of physical fitness and skills not typically required in horticulture and viticulture we are not talking about a general advertisement for backpackers. Any successful immigrant labour would have to be based on groups of workers that developed the skills and 60 – 70% of those same people returning year after year, supplemented by trainees that they introduce themselves.
  3. Technology. There is no obvious technology solution to the planting frame and spade for planting steep hill country. But it does surprise me that we have not yet developed a commercial pruning hand tool that takes some of the arm and shoulder effort away from manual loppers for pruning. Clearly any technology that can make forestry work less physically demanding will be important for retaining and attracting labour.
  4. Forestry as Career Option. Young people deserve a pathway of skills development that encourages them to both enter and stay in the forest industry. FITEC's careers development resourcing and reach into schools, and recent involvement in leading the NZ Trade Academy for primary industries (Primary industry training organisations launch Trade Academy) are both important initiatives that need to be supported by the forest industry. The profile and attractiveness of forestry as a sector to work in will be enhanced by the refocus of the NZ Wood programme on public image, and also by the Winning With Wood programmes running in Rotorua in conjunction with the World Cup, in part supported by PF Olsen through its sponsorship of the PF Olsen Forest Industries 2011 Expo.

And as a final comment, if you are planning to do some planting next year, early booking of treestocks is probably a prudent thing to do. I'll talk some more about what treestocks in next month's Clarky's Comment.