Arizona Forest
Restoration Products Inc.
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Arizona Forest Restoration Products Inc. |
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Indirect and Induced Jobs
Several different types of indirect jobs will be supported by Arizona Forest Restoration Products Inc.
Forestry Jobs
Based on Northern Arizona experience, spanning across the entire Mogollon Rim from the San Francisco Peaks to the White Mountains, it is typical for a mechanized logging "side" (a crew working a logging site) to produce about 10 "loads" (26 ton truck loads) per day, while thinning approximately 10 acres.
Therefore, the production of the 827,000 tons of wood required annually by AZFRP will typically require the operation of 14 "sides" (827,000 tons / 26 tons per load = 31,807 loads / 10 loads per day = 3,180 side days / 233 working days per side = 14 sides).
A mechanized "side" typically operates with 4 machines: 1 "feller-buncher", 1 "skidder", 1 "delimber", 1 "loader", each operated by one operator. In addition, based on the distance to the factory - hence the number of round trips that can be achieved daily, each "side" uses 2 or 3 trucks, each operated by one driver.
By contracting the operation of 14 "sides", Arizona Forest Restoration Products Inc. will therefore cause the creation of approximately 100 forestry jobs (14 "sides" x 7 operators = 98).
It is expected that these jobs will be divided between 6 to 9 logging companies in Northern Arizona (typically 2 or 3 "sides" per company) with each company employing 2 or 3 support positions. This will create 20 additional jobs, bringing the total number of jobs indirectly created in forestry to approximately 120.
Biomass Jobs
Based on the experience developed by the biomass industry in the production of electricity from woody slash, it is expected that the 24 megawatt electricity generation plant to be located in Winslow near the OSB plant will employ approximately 20 people.
Additionally, since the biomass produced during the thinning of the 32,000 acres annually can generate around 20 to 30 megawatt of electricity, it is expected that approximately a third of this biomass will be processed in another generation, gasification or liquefaction plant in Northern Arizona. This will cause the creation/support of at least 10 other jobs, bringing the total number of jobs created in biomass energy generation to approximately 30.
Multiplier Process: Indirect and Induced Jobs
Often, the impact analysis is concerned with multiplier effects, or the amount of money that is re-circulated through the economy after an initial expenditure. The social accounting matrix (SAM) is the basis for our input-output predictive model. This predictive model was used to estimate changes in the regional economy due to proposed/planned EIS: AZ Forest Restoration Products’ OSB Facility expenditures related to the construction and operation of an OSB facility. These multipliers capture the backward linkages associated with final transactions. Backward linkages are the goods and services purchased by an industry in order to produce a final product. With wood products industries, backward linkages are represented by the proposed transactions of AZFRP Inc. with local suppliers of raw material, utilities, services, and other necessities. Multipliers are a measure of the extended economic activity generated by an initial injection of capital. There are three main multipliers typically used in regional impact analysis to measure: 1) the effect on regional output, 2) the effect on household income, and 3) the effect on regional employment. The resulting multipliers delineate three separate components of regional economic activity. These components are direct effects, indirect effects, and induced effects. Direct effects are the changes in the industries to which a final demand change was made. Indirect effects are the changes in inter-industry purchases as they respond to the new demands of the directly affected industries. Induced effects typically reflect changes in spending from households as income increases or decreases due to the changes in production. These effects show the circular flow of goods and services in a region. The economic impact analysis performed measured the potential effect of the OSB facility and AZFRP’s harvesting divisions on the following economic indicators: 1. The direct, indirect, and induced effects on regional output, employment, labor income, and taxes; 2. The multiplier effects on regional output, employment, and labor income; 3. The overall number of affected industrial sectors, including a list of the most affected industrial sectors; and 4. Site-specific extrapolation of impacts and findings. (Source: Evan Hjerpe, Ph.D. NAU School of Forestry and Ronald J. Gunderson, Ph.D. NAU W. A. Franke College of Business)
Based on the IMPLAN Professional 2.0 model, approximately 180 indirect jobs and 160 induced jobs will be created. This will bring the total number of jobs supported by Arizona Forest Restoration Products Inc. to approximately 600.
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