Downsizing Nature: Managing Risk and Knowledge Economies through Production Subcontracting in the Oregon Logging Sector

W Scott Prudham
<span title="">2002</span> <i title="SAGE Publications"> <a target="_blank" rel="noopener" href="https://fatcat.wiki/container/vxbpspchljcujfhj4hh5vx3dai" style="color: black;">Environment and planning A</a> </i> &nbsp;
Oregon's logging sector is characterized by extensive subcontracting between wood commodity manufacturing firms and independent logging contractors. Why is this so? Considerable recent scholarship has examined the dynamics of flexible production systems, including regional contractor networks, as prominent aspects of late capitalism. Although useful, existing accounts of flexibility are inadequate to explain why logging in particular would be subject to contract production relations. A second
more &raquo; ... terature emphasizes the "difference" of nature-centered sectors, particularly industrial agriculture. I argue that a similar logic applies to logging. That is, natural sources of unpredictable variation and extensive, inconstant geographies restrict the predictability and calculability of production, and the imposition of labor monitoring and discipline. Contracts are a strategy for firms to displace resulting risks and costs onto contractors, while at the same time inducing expert-based rationalization of production. Repeat contracting provides a means of capturing expert knowledge among reliable contractors with knowledge of the parent firm's lands and mills. This is a particularly appealing strategy for vertically and horizontally integrated firms with complex operational portfolios. However, though contracting is one flexibility strategy, Weyerhaeuser's Competitive Logging Program featuring restructured wage relations provides an alternate path to more flexible production, one that further illuminates some of the problems of nature-based production. "Bring me Some Whistle Punks...." In the state of Oregon, most logging is accomplished via the practice of subcontracting. This involves wood commodity manufacturing firms tendering contracts to quasi-independent logging contractors -referred to in the industry as "gyppos"-to secure logging services. Although some wood products mills continue to run their own logging crews (referred to in the industry as logging "sides"), subcontracting has increasingly become the dominant form of industrial relation linking the factory floor to the woods during the post-World War II period. Given that the industry is not otherwise characterized by the existence of contract production networks (reforestation notwithstanding), why is contract logging so prevalent? In this paper, I explore why many wood products firms undertake logging by means of relatively arms-length industrial relations. I explain the incentive to contract out and to pursue other alternatives to fixed hourly wage relations as strategies for achieving production flexibilities in response to the nature-centered character of production in the logging sector. Specifically, I argue that variability, risk and uncertainty associated with the "in situ" character of logging production -i.e. the intimate engagement of social and natural production -creates an incentive for firms to minimize their exposure to these risks and uncertainties while at the same time inducing rationalized production. Not only does this explain why contract logging appeals to wood products manufacturing firms, it also explains why the largest firm in the state's forest industry -Weyerhaeuser -has pursued both contract logging, and more recently, restructured wage relations featuring production based incentives for unionized company loggers. There is a considerable existing literature on contract production networks as a feature of late capitalism. Such networks -specifically their apparent resurgence-2 underpin notions of post-Fordist production systems and are critical to debates over the dynamics of social power in contemporary industrial economies. This literature tends to emphasize contracting as a strategy for achieving both flexible and lean production, insulating firms from unpredictable variations in market demands and circumventing the comparative rigidities of vertically integrated social structures and fixed hourly wage relations. These explanations are adequate in certain respects; subcontracting does act to insulate contracting firms from market risks, and may be seen to confer certain flexibilities in production relations. However, the reason why certain elements of production would be targeted for "putting out" remains to be explained. If, following Scott (1987), this turns on internal and external economies of scope, how do firms decide what to do in house, and what to accomplish via contracting? Addressing this issue requires careful consideration of specific material aspects of production processes, consistent with a "problem-oriented" approach to industrial organization (Sayer, 1989 (Sayer, , 1995 . In the specific context of logging, this requires addressing what I refer to as "nature-centered" production. In what follows, I first provide some contextual information on logging in Oregon. I then review in greater depth some theoretical approaches to contractor networks, wage relations, and flexibility perspectives on contemporary industrial systems. Subsequently, I turn to the ways in which nature-centered production has been theorized as an influence on the social organization of food, fiber, and raw materials sectors. In particular, I discuss nature as a source of risks, uncertainties and rigidities, and therefore a possible influence on the incentive to contract out. I then examine the specific dynamics of social and natural production in the logging sector, with emphasis on the ways that subcontracting relations insulate firms from certain production risks and at the same time encourage more efficient 1 Old-growth is defined in various ways, but typically refers to what the industry calls "over-mature" stands, characterised by a preponderance of trees in excess of 150 years old. 2 These differences vary considerably, since gyppo contractors use different pay scales. Data on average salaries between contract and company loggers are not available. However, according to the 1997 census of manufacturing, the average hourly production wage in the Oregon logging sector was $14.75. Based on the interviews I conducted with gyppo contractors, a typical gyppo employee can expect a salary more in the $10-12 range. representative September 2 nd , 1997 with a follow-up on October 28 th , 1998 and an interview conducted September 25 th , 1997, also with a union representative. It is also based on inferences drawn from the census of manufactures, and information provided by the AOL. According to the most recent AOL estimates, there are about 840 active independent logging contractors in Oregon. The 1997 census of manufactures reports 1,130 logging establishments in the state. This would indicate that on the order of one quarter to one third of the logging establishments are company logging establishments. However, the census allows for firms to be counted more than once if they have multiple establishments, and the AOL survey indicates that the average logging contractor maintains 1.8 logging sides.
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