Study confirms value of craft beer industry to Maryland economy

| November 8, 2017
Rams Head

Maryland’s craft beer industry had an overall economic impact of $637.6  million and supported or created 6,541 jobs in 2016, according to an economic impact study conducted by the Bureau of Revenue Estimates that was released during a recent Reform on Tap Task Force meeting.

The study found that when the sale and distribution activity of non-Maryland craft beer is included in the projection, the estimated economic impact grew to $802.7 million. The industry contributed $53.1 million in state and local revenues and $55.3 million in federal revenues, which directly supports investments in education, public safety, transportation and the environment.

“The craft beer industry is one of our state’s most important and fastest growing economic engines.  The men and women at the forefront of this dynamic industry are creating good-paying jobs, strengthening local economies and attracting tourists to communities in every corner of our state, ” said Comptroller Peter Franchot, who created the Reform on Tap Task Force in April to modernize the state’s antiquated laws governing the manufacturing, distribution and sale of Maryland craft beer. “However, the fact that we lag so far behind our neighboring states is a reminder that we can do so much better.  Flying Dog’s recent announcement that they will postpone plans to expand their brewery operations in Frederick underscore the severe consequences of a statutory and regulatory environment that impedes the growth and success of this industry. That is why it is critical that we reform, from top-to-bottom, the outdated laws that have restricted the growth of this industry for too long.”

In 2016, Maryland craft breweries directly employed 430 workers, and had an indirect and induced effect on 264 jobs – yielding a total of $28.4 million in wages and generating $143.7 million in economic output, according to the study.

Both alcohol distributors and retailers (bars and restaurants) also greatly benefited from Maryland’s craft brewers, with a direct, indirect and induced effect on almost 6,000 jobs, about $200 million in labor income and nearly $500 million in economic activity, the report found.

The analysis also indicates that Maryland’s craft beer industry has room to grow. That is demonstrated most clearly by the state’s status as a net importer of craft beer, meaning that the state consumes more craft beer (275,000 barrels) than it produces (247,000 barrels).

“This study reveals not only the substantial size of this industry in its current status, but also that, when various comparative metrics are taken into account, the industry has considerable room to grow,” said Andrew Schaufele, director of the Maryland Bureau of Revenue Estimates.

Furthermore, the National Brewers Association finds that Maryland trails other states, ranking 47th in economic impact, 36th in number of breweries and 25th in gallons produced per adult aged 21 years and over. Although production among Maryland craft brewers has steadily increased at an annual rate of 15 percent over the past five years, it has lagged behind the national average of 18 percent.

To read the full report of the Economic Impact of Maryland’s Craft Beer Industry prepared by the Maryland Bureau of Revenue Estimates, please click here.

Severn Bank

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