S2This paper concentrates on the potential economic importance of Vermont's sawtimber. The timber industry employed over 9,000 workers in 1980, and the value of stumpage cut that year was worth approximately $459 million to the State's economy. Preliminary resurvey data indicate that sawtimber inventory now exceeds 14 billion board feet. Yet, sawtimber removals have averaged only 200 million board feet per year over the last 10 years. We used an input-output model called IMPLAN V1 .I to predict socio-economic impacts of several sawtimber production levels. The results indicate that improved markets for the existing resource could significantly contribute to the State's economy. If 50 percent of the projected annual growth could be marketed, an additional $152 million contribution could be made to the State's gross product and over 9,000 new jobs created.S3.