Is Beer Really Recession-Proof? |

Is Beer Really Recession-Proof?

The relationship between consumer spending and troubled economic times is often a basic one: when times are tough, people cut back. And for restaurants, high-end food products, and top-shelf liquors, this seems to be the case. But what about beer?

Historically, beer has been considered a recession-proof industry: taps keep flowing in good times or in bad. Since the beginning of data collection in 1959, beer consumption has had no significant correlation to rises or falls in GDP. But beer revenue plummeted by nearly 14 percent in the last quarter of 2008 alone—proving that not even breweries are immune from the current recession.
As Nate Silver at points out, recent years have seen an explosion of craft breweries, whose beer is priced at a higher level than all-American classics like Bud or Coors. If consumers have been spending more on pricey microbrews, they may see beer as a luxury good that they can cut back on; they may also switch to a cheaper brand. But small, higher-cost breweries aren’t the only ones feeling the pinch. Even wallet-friendly Miller Lite has dropped 7.5 percent in sales.

And in response, major producers are starting to cut back their payrolls. Anheuser-Busch, makers of Budweiser and recently purchased by InBev, cut 1,400 jobs in the last month of 2008; Carlsberg cut nearly three hundred.

In today's economic climate, a cold beer may be a simple pleasure that people return to at the end of a long day. But when times are tough, they may think twice about even these simple pleasures.


bdolan001 • 04/06/2009
It would be interesting to see what the drop in Restaraunt/ Bar verse the store market sales of beer is. Also the corelation with the rising cost of hops running the cost of the craft and "common" beers up slightly higher has done.
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