Answer: The US beer industry has lost some 40,000 jobs since 2016
It’s an interesting time to be working in the American beer industry, or not working if you’re one of the 40,000 people who have been impacted by job cuts over the past three years. According to a report by the Beer Institute and National Beer Wholesalers Association “direct, indirect and induced jobs fell to 2.19 million in 2018 from 2.23 million in 2016.” According to analysts and observers, the industry is placing the blame on two trends: tariffs and taste.
Many people in the beer industry are blaming the Trump administration’s tariffs for thousands of job losses across the United States. Beer Institute President Jim McGreevy told The Hill in a statement that, “aluminum tariffs are increasing brewers’ costs and are an anchor on a vibrant industry.” Moreover, “each brewer is deciding for themselves how to absorb that expense, whether it’s raising prices, laying off workers or delaying innovation and expansion, all of which hurt a vibrant job-creating industry.” Bloomberg continues on to say that the “shipping and logistics charge for delivering aluminum to the U.S. Midwest, known as the “premium,” more than doubled as Trump slapped a 10% tariff on imports of the metal. Molson Coors Brewing Co. estimated last year that the levies would create a $40 million hit to its bottom line.” While tariffs may be increasing the cost of goods sold, there’s also another trend that could be responsible for the job losses: taste.
Statista – Beer consumption has shrunk for the past two years, with 2019 projected to be no different. IWSR has projected that beer consumption will fall by 3.7 percent among people in the U.S., while spirits are expected to jump by 14.4 percent this year. Over the past four years, wine and spirits have experienced growth in consumption among Americans, while beer consumption has flatlined and then fallen within that same time frame.
Millennials and Gen Zers are drinking less than older generations. Business Insider pointed to a 2018 report from Berenberg Research that highlighted the fact that respondents in their teens and early 20s were drinking over 20% less per capita than millennials — who drank less than baby boomers and Gen Xers — did at the same age. In total, cases of beer, wine, and spirits consumed in the U.S. dropped 0.8 percent to nearly 3.35 billion in 2018, the third consecutive year of declining volumes, according to a report from IWSR, which studies the beverage market. At the same time, sales of nonalcoholic beer and cocktails are exploding. The shift in tastes has been a major disrupter to the beer industry, and as all major brands try to predict tastes, it’s causing friction in the hiring space. How long this hangover lasts is hard to say.