The 10 States Making the Most on Beer

April 1, 2013 by 247sam

Most states rely on a relatively small number of industries for much their employment and economic activity. The industries that come to mind are auto manufacturing, defense, government, financial services and agriculture.

As it turns out, the brewing and wholesaling of beer can be added to the list for several states, including Colorado and Missouri. This beer economy can thrive in the United States because there are so many beer drinkers — 6.38 billion gallons of beer were consumed in America in 2011, which is roughly equivalent to the amount of milk consumed that year.

Click here to see the states making the most on beer

In addition to the industry itself, sectors that claim to have large GDP footprints also use numbers from other parts of the economy stimulated by its economic activity. The auto industry regularly has said its manufacturing and sales revenue ripple out to car dealers, parts makers and the railroads and trucks that carry cars from factories to showrooms. At the start of the recession, the governor of Michigan claimed that, nationwide, this included one in every 10 jobs.

Researchers who track the beer industry, led by the association of the industry’s brewers, the Beer Institute, recently reported results of a national study. They found that the manufacturing, retail and distribution sectors of American industry get an extraordinary boost from beer production. Among the 50 states, according to the report, Colorado and Missouri rely on beer for more than 6% of their gross domestic products (GDPs). The entire manufacturing industry is responsible for only 10% of the national GDP.

The top three states, as measured by the beer industry’s economic effect on GDP, are Colorado, Missouri and Wisconsin. It probably is no accident that the country’s three largest brewers were founded in those states — Anheuser-Busch InBev S.A./N.V. (NYSE: BUD) in St. Louis, SABMiller in Milwaukee and Molson Coors Brewing Co. (NYSE: TAP) in Golden, Colo. Each state still has a large number of brewery locations compared to other states, and the same is true for the employee count of brewers and related industries.

While much of the beer produced in these states is shipped around the country, states with larger brewing industries also tend to be associated with more beer consumption. Of the 10 states where beer production represents the highest proportion of GDP, seven consume more beer per capita than the U.S. average. In 2011, Americans consumed about 28.3 gallons per person. This includes New Hampshire, which drinks more beer than any other state in the country — 43 gallons per capita.

The 10 making the most from beer also appear to be much more open to drinking as well. While many states have so-called blue laws, which restrict the purchase of alcohol and tobacco at certain times, on certain days or in certain stores, the states with the highest beer production generally lack such laws. Of the 10 states, only one — Georgia — prohibits Sunday sales of beer. All 10 of the states allow beer to be sold in gas stations or convenience stores, while eight other states around the nation prohibit it.

Based on total economic impact by state provided by the Beer Institute and GDP by state from the Bureau of Economic Analysis, 24/7 Wall St. calculated the 10 states where the beer industry accounted for the largest portion of the state economy. Among the data we included were the number of brewers and beer wholesalers in each state, as well as the jobs created by each industry and total tax contribution by the industry, all from the Beer Institute for 2012. Based on data published last year, the Beer Institute calculated the total amount of beer sold in the state each year, and, dividing it by the total population over the age of 21, estimated the average consumption per person.

These are the 10 states making the most from beer.

10. California
> Beer as a pct. of GDP: 1.97%
> Beer economic output: $34.2 billion (the highest)
> GDP: $1.7 trillion (the highest)
> Jobs: 241,640 (the highest)

California’s beer industry was worth more than $34 billion in economic output in 2012, by far more than any other state in the country. There were 721 brewers and beer distributors in the state, while more than 240,000 people were employed directly by the industry or in a supporting capacity. Both figures are the largest in the country by a sizable margin. Anheuser-Busch InBev, the largest brewer in the world, has a brewery n the city of Fairfield. The country’s second-largest beer company, MillerCoors, has a brewery located in Irwindale.

9. Montana
> Beer as a pct. of GDP: 2.05%
> Beer economic output: $656 million (8th lowest)
> GDP: $32.0 billion (3rd lowest)
> Jobs: 8,530 (8th lowest)

There was one beer distributor or brewery in Montana for every 12,258 residents, the highest ratio in the country. According to a report released by the University of Montana last year, the craft brewery industry has grown significantly in the state. Between 2010 and 2011, beer production in the state’s breweries increased 18%, while the sale of those beers increased 20%. None of the brewers in the state are very large, though. The largest brewer in the state, Big Sky Brewing, produced a little more than 45,000 barrels in 2012. In comparison, Anheuser-Busch produces more than 100 million barrels a year. Residents of Montana drink more beer than all but two other states, at 40.6 gallons per capita, compared to a national rate of 28.3 gallons per person.

Also Read: The Most Tax-Friendly States for Business

8. Florida
> Beer as a pct. of GDP: 2.14%
> Beer economic output: $14.2 billion (4th highest)
> GDP: $661.1 billion (4th highest)
> Jobs: 139,190 (3rd highest)

The beer industry in Florida contributed more than $14 billion in economic activity, more than in all but three other states. Florida had 228 brewers and beer distributors, the 10th most of all states. More than 139,000 people worked in the beer industry, more than in any other state except for California and Texas. The craft brew scene is most evident in the Tampa Bay area, with a dozen breweries in the area as of late 2012 and several more scheduled to open soon. In addition, D.G. Yuengling & Son operates a brewery in Tampa, while Jacksonville is home to one of 12 Anheuser-Busch breweries in the country.

7. Georgia
> Beer as a pct. of GDP: 2.37%
> Beer economic output: $8.7 billion (10th highest)
> GDP: $365.8 billion (11th highest)
> Jobs: 64,610 (9th highest)

More than $186 per person in taxes on beer sales were collected in Georgia, the seventh-most in the country. A 32 cent per gallon state excise tax is levied on beer purchased in Georgia, while an additional 53 cents per gallon is levied by local governments. These are among the highest beer taxes of all states. Despite the beer industry playing such a critical role in Georgia, the number of breweries and beer distributors per capita was the second lowest of all states. Although Georgia is the eighth-largest state in terms of population, there were only 106 breweries and beer distributors in the state, the 19th highest number.

6. New Hampshire
> Beer as a pct. of GDP: 2.39%
> Beer economic output: $1.4 billion (18th lowest)
> GDP: $56.6 billion (11th lowest)
> Jobs: 10,320 (11th lowest)

Despite New Hampshire’s small size, the beer industry managed to produce about $1.4 billion in economic activity and employ more than 10,000 people, significantly more than in states of similar size. The state is one of just four where the economic output of beer sales per capita topped $1,000. Furthermore, more than $228 of taxes were generated per capita, higher than in all but three other states. New Hampshire is home to a host of microbreweries, such as Smuttynose Brewing Company and White Birch Brewing. The city of Merrimack is home to an Anheuser-Busch brewery as well. New Hampshire doesn’t just produce lots of beer, it also drinks it. No state consumes more beer per capita than New Hampshire, at 43 gallons per person, which is nearly 15 gallons more than the national average.

5. Ohio
> Beer as a pct. of GDP: 2.39%
> Beer economic output: $10.0 billion (8th highest)
> GDP: $418.9 billion (8th highest)
> Jobs: 82,730 (6th highest)

Ohio is one of just eight states where the total economic output for the beer industry was at least $10 billion. In addition, the industry provided jobs to nearly 83,000 people, more than in all but five states. Perhaps the most prominent microbrewery in the state is Great Lakes Brewing Company, which produces more than 125,000 barrels annually. Moreover, Columbus is home to an Anheuser-Busch InBev facility, while MillerCoors has a brewery in Trenton.

Also Read: America’s Most Content (and Miserable) Cities

4. Vermont
> Beer as a pct. of GDP: 2.40%
> Beer economic output: $552 million (7th lowest)
> GDP: $23.0 billion (the lowest)
> Jobs: 6,130 (6th lowest)

Compared to many states, Vermont’s beer industry is actually quite small, with a total economic output of just over $552 million, the seventh-smallest amount in the country. But it is a different story when comparing the industry to the state’s population as a whole. According to the most recent figures from the Brewers Association, a trade group representing manufacturers, Vermont has more craft breweries per capita than any other state. One of the largest microbreweries in the country, Magic Hat Brewing Company, is located in Burlington.

3. Wisconsin
> Beer as a pct. of GDP: 3.90%
> Beer economic output: $8.7 billion (11th highest)
> GDP: $221.8 billion (21st highest)
> Jobs: 60,630 (12th highest)

Wisconsin’s beer industry generated more than $1,500 in economic activity per capita, more than in all but two other states. Wisconsin is also one of just three states that has more than one job in the beer industry for every 100 people. Milwaukee is home to the North American headquarters of SABMiller, which produces beers such as Miller Lite, Coors Lite and Blue Moon through its joint venture with The Molson Coors Brewing Company. The joint venture, called MillerCoors, has roughly 30% market share of all beer in the United States. The brewery in Milwaukee produces 10 million barrels of beer per year and employs 720 people.

2. Missouri
> Beer as a pct. of GDP: 6.10%
> Beer economic output: $13.2 billion (6th highest)
> GDP: $216.1 billion (22nd highest)
> Jobs: 64,320 (11th highest)

More than 6% of Missouri’s GDP came from the beer industry, higher than in all states except for Colorado. The beer industry was responsible for generating about $441.65 in taxes per capita. St. Louis is home to the North American headquarters of Anheuser-Busch, which controls 47% of the U.S. market share for beer. The company announced plans in late 2012 to purchase Groupo Modelo for $20.1 billion, which would give Anheuser-Busch an additional 6% market share in the country. However, antitrust concerns from both consumers and the U.S. Department of Justice have stalled the bid.

1. Colorado
> Beer as a pct. of GDP: 6.31%
> Beer economic output: $14.8 billion (3rd highest)
> GDP: $234.3 billion (18th highest)
> Jobs: 58,360 (13th highest)

No other state’s economy is directly affected by the beer industry more than Colorado. The beer industry produced $2,850 per resident in the state, more than in any other state by about $660. Moreover, approximately one in every 89 jobs in the state is tied to the beer industry, the highest concentration in the country. Colorado is home to the Molson Coors Brewing Company. The brewery in Golden is the largest brewer by volume in the company, producing more than 11 million barrels of beer each year. Colorado’s alcohol sales laws are fitting for the state with the largest brewing economy. Colorado doesn’t have any restrictions on beer sales in grocery stores, convenience stores, or gas stations, but it does prohibit wine and spirit sales in those places.

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