Report: Beer is booming in Michigan

Industry supported almost 67,000 jobs in 2020.
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Beer’s overall impact on the state’s economy is pegged at $9.9 million. Courtesy iStock

(As seen on WZZM TV 13) Michigan’s beer industry is a nearly $10 billion business, according to a recent report.

The Beer Serves America report, authored by the National Beer Wholesalers Association and the Beer Institute, found Michigan’s beer industry had an overall economic impact of $9.9 billion in 2020 and supported almost 67,000 jobs at breweries, distributors, retailers and more.

“Michigan’s independent, locally owned beer distributors are proud to work hand-in-glove with brewers big and small right here in Michigan, across the country and around the world to help them grow and thrive on a level playing field,” said Spencer Nevins, president of the Michigan Beer and Wine Wholesalers Association. “This new data makes clear that Michigan is not just the Great Lakes State but also the Great Beer State, and Michigan’s beer distributors are proud to play a role in the beer industry’s continued success.”

Beer Serves America measures the impact of the malt beverage industry — as defined by its three tiers: brewing, wholesaling and retailing — on the entire U.S. economy. Overall, the industry contributes $331.8 billion in economic output, equivalent to about 1.6% of GDP.

In Michigan, the beer industry produced 66,990 total jobs, 1,924 of which were in brewing, 4,866 were in distribution, 26,256 were in retail, 1,223 were agriculture related, and 2,789 were in manufacturing.

Altogether these jobs paid Michigan workers $3 billion in wages and benefits and generated $1.5 billion in taxes for the state.

“Michigan’s beer distributors have deep roots in the communities they serve,” Nevins said. “That was on display throughout 2020 as our members partnered with local distilleries to produce and deliver hand sanitizer to front-line medical workers and nursing homes when there was a worldwide shortage because of the COVID-19 pandemic and supported local restaurants and their employees.”

On the national scale, the beer industry accounted for roughly 2 million jobs, paying $102.9 billion in wages and benefits and generating $55.2 billion in taxes.

Brewpubs and small micro-brewers number in the thousands across the U.S., and most of the growth in establishments is coming from local and regional brewing operations. Of course, the beer industry didn’t come out of 2020 unscathed. The government-imposed shutdowns in response to COVID-19 proved to be significant obstacles to growth.

Six hundred small breweries closed permanently due to the COVID-19 shutdowns, according to the report. Nearly 150,800 jobs were lost because beer could not be sold at restaurants, entertainment venues and bars.

Even as the volume of beer sold rose slightly over the past year, sales fell by over $8 billion as consumers purchased less premium beer. Since the COVID outbreak, there has been a shift away from more expensive local beers in bars and restaurants to beers produced by national brewers and importers, which are generally more readily available for off-premises sale, the report said.

Employment in the wholesale tier is up by 16.3% over the past decade, according to the U.S. Department of Labor. The growth in wholesale jobs can be attributed to the development of new beer products, substantial growth in imports and more regional and national distribution by smaller producers. Despite this, like brewing jobs, wholesale jobs fell in 2020 because of COVID-19.

Data from November 2020 showed beer retail jobs were down fairly dramatically since 2018, as many states were still restricting on-premises establishments from fully opening. Off-premises retail was up by 17% over 2018, while on-premises jobs were down by nearly 22.4%, the report stated.

Methodology

Beer Serves America, the Study of the U.S. Beer Industry’s Economic Contribution, has been conducted regularly by the Beer Institute and the National Beer Wholesalers Association (NBWA). John Dunham & Associates (JDA) conducted the research in concert with the Beer Institute and NBWA. This work used standard econometric models first developed by the U.S. Forest Service and now maintained by IMPLAN. Data came from industry sources, government publications and Infogroup.

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