There are certain areas in the United States, such as the Pacific Northwest, that have large lumber industries.

Question

There are certain areas in the United States, such as the Pacific Northwest, that have large lumber industries. Suppose that the area is devastated by several forest fires, which greatly reduce the supply of lumber. What will the likely effect be on home building companies and their workers?

Answer 1

The contractors of homes and commercial buildings would need to find other areas to harvest their lumber which may drive the cost up. Or they may need to use other materials like bricks for buildings. If they rely solely on the lumber that has gone up in smoke (literally), then their business will suffer.