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Author ORCID Identifier

https://orcid.org/0009-0000-9174-0546

Date Available

5-1-2028

Year of Publication

2026

Document Type

Master's Thesis

Degree Name

Master of Science in Forest and Natural Resource Sciences (MSFNRS)

College

Agriculture, Food and Environment

Department/School/Program

Forestry and Natural Resources

Faculty

Thomas Ochuodho

Faculty

Jian Yang

Abstract

Over the years, Kentucky forest sector has grappled with persistent structural labor shortages, retention, and skill mismatches, which threaten its long-term competitiveness and sustainability. In economic production process, labor and capital are required in certain ratios determined by prevailing production technology. To address the structural labor challenges, the Kentucky forest sector has employed strategies, including automation to substitute capital for labor and boost productivity. This research has two objectives: (1) to conduct a comparative analysis of input factor shares, factor productivity, and total factor productivity (TFP) across 29 Kentucky forest industries from 2001-2022 in order to shed light on the sector’s structural changes over time; and (2) to determine factors that influence total factor productivity trends in Kentucky forest sector from 2001-2022. A classic CobbDouglas production function framework and a generalized additive model (GAM) were employed using annual data in estimating smooth trends in labor and capital shares, factor productivities, and TFP. A multiple linear regression (MLR) model was used to determine the factors that influence TFP trends using annual data of employment, labor force participation rate, injuries, average pay, and capital-labor ratio. Results indicate substantial heterogeneity in factor intensity across the forest industries with mixed labor-capital substitution and complementarity behavior where factor intensity and substitution dynamics as the key drivers of productivity growth. Capital-labor ratio indicated strong positive effect on TFP. Overall, Kentucky forest sector overwhelmingly remains laborintensive despite declining labor share and automation. These results highlight the critical role of workforce stability and targeted capital modernization in shaping Kentucky forest sector productivity. This study provides a baseline for understanding Kentucky forest sector input divergence and a guiding policy insight to enhance the sector’s competitiveness, sustainability, and resilience, through viable incentives for workforce development to attract younger generation to the forest labor force.

KEYWORDS: Structural changes, factor shares, factor productivity, total factor productivity, forest sector

Digital Object Identifier (DOI)

https://doi.org/10.13023/etd.2026.251

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Archival

Funding Information

This project was supported by the United States Department of Agriculture – National Institute of Food and Agriculture – McIntire–Stennis Cooperative Forestry Program Project (USDA-NIFA Mclntire-Stennis Project #KY009045) in 2024.

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