The beer trade contributes $ 12.6 billion to the Ohio economic system

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The beer industry contributes $ 12.6 billion to the Ohio economy

According to the latest study by Beer Serves America, released May 27, the Ohio beer industry – made up of beer makers, sellers, and shipments of beer, and companies in related manufacturing and agriculture sectors – contributes an estimated $ 12.6 billion state economy.

The biennial study is carried out by John Dunham and Associates of New York on behalf of the Beer Institute and the National Beer Wholesalers Association. It captures a snapshot of the industry in early 2020, just before the COVID-19 pandemic in America, said NBWA chief economist Lester Jones.

Beer production was hampered due to a few months of economic uncertainty in the early days of the pandemic lockdown last spring. The closings of bars, restaurants, taprooms and entertainment venues also had a major impact. The study effectively represents the size of the beer industry as it returns to pre-pandemic activity levels.

"A lot of data came before we felt the full effects of the pandemic," Jones said. "So I think it's a pretty good representation of where we're getting out of this trough."

According to the Brewers Association, U.S. beer sales and production volumes each fell about 3% in 2020. Sales and production in the craft beer category fell by more than 9% last year, marking the first annual decline in craft after decades of steady growth.

Beer Serves America's study only looks at jobs and economic activities specifically related to the sale, shipping and production of beer throughout the supply chain. These include large breweries – like those operated in Ohio by Anheuser-Busch, MillerCoors, and The Boston Beer Co./Samuel Adams – and the state's 370 or so craft breweries, retailers, and distributors. For example, it does not take into account restaurants operated by craft brands.

Here are the Ohio stats:

Total jobs: 71,406

Total economic output: $ 12.6 billion

Total Taxes Paid: $ 2 billion

Brewing jobs: 2,795

Sales orders: 5,275

Retail jobs: 24,717

Agricultural jobs: 1,712

Production orders: 3,781

The metrics for Ohio are down slightly compared to the previous study. The 2018 report estimates that Ohio's beer industry represents an economic output of $ 12.8 billion and a total of 81,448 jobs.

Jones said the NBWA doesn't read much about the differences between the estimates in the various reports or why the numbers might change – so what contributed to the change he can't quite say. However, a 1.5% decline in economic output compared to a 12% decline in jobs appears to indicate an increase in the productivity of the labor force.

Nationwide, Beer Saves America estimates the beer industry represents 2 million jobs and an economic output of nearly $ 331.8 billion, with $ 55.2 billion in taxes paid.

Reports like this are often used by trade groups when presenting their case to lawmakers on issues such as tax policy. An ongoing issue in the beer sector is federal excise tax.

"Last year, Congress came together to prevent the federal excise tax on beer from increasing," said Jim McGreevy, President and CEO of the Beer Institute, in a statement. "Maintaining the current state and federal tax rate for the beer industry will help support American jobs at a time of significant economic uncertainty."

Ohio is the fifth largest craft beer maker in the country – thanks in large part to big brands like Cleveland's Great Lakes Brewing Co. and Cincinnati's Rhinegeist Brewery – and is in the top 10 states for total breweries, according to data the BA. With dozens more craft breweries planned, Ohio is well on its way to hitting the top 400 this year.

Read more about the state of the craft industry in Buckeye state that has emerged from the pandemic here.

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