TIMBER industry workers are reportedly being told not to take out loans or buy houses given the destruction of forests during last summer's bushfires.
The ruination of softwood stands across North East Victoria, Tumbarumba and Tumut is tipped to drop saw log supply by more than 500,000 tonnes for the next 20 years.
Softwoods Working Group chairman Peter Crowe said trees in native forests and plantations hit by fire were being salvaged to be processed and then stored.
However, the overall state of the industry was grim.
"With 50 per cent of the saw logs gone the wood doesn't exist anywhere else for the next 30 years," Mr Crowe said.
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"There needs to be a reconfiguration and the companies are grappling with what that reconfiguration means and one company has advised employees not to borrow any money and not to buy any houses."
The jobs of an estimated 5000 people across Snowy Valleys Council, which covers Tumbarumba and Tumut, are directly or indirectly tied to the timber sector.
Mr Crowe forecast a "massive amount of economic damage" based on $800 million annually being lost due to reduced production.
He said the Forestry Corporation of NSW planned to plant 5100 hectares of trees for the next 10 years and it would not be feasible to do any more.
Tumbarumba councillor Bruce Wright said the by-election candidates for the federal seat of Eden-Monaro, which covers Snowy Valleys, needed to show support for timber workers.
Labor candidate Kristy McBain visited Tumbarumba's Hyne timber mill with Opposition leader Anthony Albanese last month.
"I want to make sure that I am a strong local voice in Canberra for places like this," Ms McBain said after noting the mill employed 230 and contributed $8 billion annually to the local economy.
"What is very positive is the salvage of the burnt areas (so the resource is maximised)," Dr Kotvojs said.