Craft beer is losing its shine — at least that’s what you would have thought if you only glanced at some of the clickbait headlines after this week’s mid-year report from the Brewers Association (BA), the not-for-profit trade association dedicated to small and independent American brewers, as well as CraftBeer.com’s parent organization.
If you only digested the negative headlines or gobbled up the lowlights in 140 characters or less, this is a great lesson in why we should all read beyond the “bad news” spin to get the full context of the story.
The July 26 report looked at mid-year data for craft breweries in the U.S. The BA defines a craft brewer as small, independent and traditional.
- Small: Annual production of 6 million barrels of beer or less.
- Independent: Less than 25 percent of the craft brewery is owned or controlled (or equivalent economic interest) by an alcoholic beverage industry member that is not itself a craft brewer.
- Traditional: A brewer that has a majority of its total beverage alcohol volume in beers whose flavor derives from traditional or innovative brewing ingredients and their fermentation. Flavored malt beverages (FMBs) are not considered beers.
According to the report, the production volume of American craft beer grew eight percent in the first half of 2016. That is indeed a slower pace than the first half of 2015, which saw a 16 percent production volume increase. But as Bart Watson, chief economist at the BA, acknowledges, the industry itself is maturing.
“As craft’s base gets larger, as with any industry, it becomes more difficult for it to grow at the same percentage rate. Yet there is still tremendous dynamism reflected in eight percent growth for craft,” Watson explains. It’s one of the key points you’ll miss if you’re only digesting the story at the headline level. Here’s a closer look:
1. Maturation not Saturation
“While the craft brewing industry is entering a period of maturation, most markets are not near saturation,” Watson said. That means there are more communities in the U.S. that could support more breweries. Consider this math:
Breweries: 1 for every 69,322.
So there are ~5.8 Subways, 3.0 McDonald's, & 2.7 Starbucks for every brewery. https://t.co/eiSbGcnBtZ
— Bart Watson (@BrewersStats) July 26, 2016
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2. Historic Number of Operating U.S. Breweries
The BA says 4,656 breweries were operating in the U.S. at the time of the report, over 900 more than this time last year. Watson says the rate of breweries opening is still “incredibly strong” compared to the ones closing.
The number of operating U.S. breweries, 4,656, also marks a new historic high. Those small and independent breweries are also responsible for 121,843 full-time and part-time jobs, according to the report; many of those jobs are in manufacturing.
There are another 2,200 breweries in planning, too. You’re experiencing history in the making.
Beyond the report, craft brewers are contributing to an unprecedented amount of choices for beer lovers.
“Today’s marketplace offers an unparalleled number of styles, flavors and brands of beer – from domestics to imports,” Craig Purser, president and CEO of the National Beer Wholesalers of America (NBWA) said in response to the BA report. NWBA chief economist Lester Jones also predicts the U.S. beer industry will see “continued positive growth” in 2016 as craft brewers attract new people.
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So growth in production, a historic number of operating breweries combined with consumer choice equate to positive news for the craft beer industry. Don’t worry: Your IPAs (and porters and pale ales and goses) aren’t going anywhere anytime soon.
CraftBeer.com is fully dedicated to small and independent U.S. breweries. We are published by the Brewers Association, the not-for-profit trade group dedicated to promoting and protecting America’s small and independent craft brewers. Stories and opinions shared on CraftBeer.com do not imply endorsement by or positions taken by the Brewers Association or its members.
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