CHARLOTTESVILLE, AUG. 17 -- Virginia's wood and paper products industries have emerged from a period of depressed prices and tough foreign competition revitalized and better suited to command a share of the market, says a report released today.
"The drive for increased productivity and cost competitiveness is very evident," said Robert Haigh, professor at the university's Colgate Darden Graduate School of Business Administration and author of the report.
Evidence of the improved positions were reflected in increases in 1986 profits and by the strong common stock prices, he said, noting that every company surveyed outperformed the Dow Jones industrial average at a time when the Dow Jones was at a record.
Haigh and research assistant Donald Lindsey interviewed more than 30 executives in Virginia's forest products industries. The report, "Leading Virginia Industries, Wood and Paper Products, A Business Update, 1987," examines industry problems, company plans and operations and the business outlook.
In the early 1980s, about 25 percent of the state's wood products companies and 15 percent of the paper companies went out of business, Haigh said, primarily because of global competition and depressed prices in a low growth industry.
Haigh and Lindsey said the industries have now recovered to add substantially to the state's economic strength. With 22,800 employes in 1985, the lumber and wood products industry ranked ninth in size among Virginia's manufacturing industries. With 15,900 employes, the paper and allied products industry ranked 11th.
To achieve a strong position in the state's economy as well as realize solid earnings for 1987, Virginia's companies used aggressive strategies: huge capital expenditures for labor-saving equipment, specialized products and improvements in customer service, the report said.
Among the most impressive findings of the study were "the sophisticated applications of advanced technology we observed in some plants in both industries," said Haigh.