Beer contributes $16.5 billion to Australia's economy

Tuesday, 11 June, 2019

Beer contributes $16.5 billion to Australia's economy

With 84% of all beer sold in Australia made in Australia, the beer sector is a huge supplier of local jobs and a major economic driver, according to recent data.

The economic analysis by ACIL Allen Consulting for the Brewers Association of Australia found domestic beer production supports almost 103,000 full-time Australian jobs and generates $16.5 billion a year in economic activity, accounting for around 1% of the nation’s GDP.

Locally brewed beer alone supports 12,564 full-time Australian jobs in its direct supply chain and generates almost $6 billion in economic activity, noted Brewers Association of Australia CEO Brett Heffernan.

“For every direct full-time equivalent job making beer in an Australian brewery (3700), a further 26.8 jobs are created elsewhere in the economy,” he said.

This includes beer manufacturing, packaging materials, and retailing pubs and restaurants.

Despite imports increasing from 14% in 2015–16 to 16.2% in 2017–18, Heffernan said beer is largely a domestic industry, with the three major local brewers (CUB, Lion and Coopers) accounting for 79.4% of sales volume.

“Interestingly, despite the year-on-year exponential growth in the number of small brewers, they account for 3.4% of sales volume, with home brew at 2.1% and imports at 16.2%. Exports run to 1.5% of domestic production volume.”

The analysis also revealed that Australians pay the fourth-highest tax on beer in the world, alongside Scandinavian countries and Japan.

“The 2017–18 data on beer taxes is telling. Australian beer drinkers poured $3.613 billion into government coffers — that’s just over $2 billion in excise and $1.6 billion in GST. Australian Government tax is the single biggest cost in the price of a beer,” Heffernan said. “In fact, based on a typical carton of 4.9% alcohol by volume beer retailing at $51.00, a whopping $21.35 — or 42% — is tax.”

However, as Australians become more informed about responsible drinking, alcohol consumption is falling, even for those underage and pregnant. Describing it as a “positive cultural change”, Heffernan noted figures from the Australian Bureau of Statistics (ABS) that found Australians drink less alcohol today than at any point in the last 55 years, and 84% drink within recommended guidelines.

“Demand for light and mid-strength beers has remained constant at 26.5% of sales volume; however, the trend to lower-strength beers has seen full-strength beers sold in Australia average 4.4% alcohol by volume, down from the once typical 5%.

“Over 9.1 million Aussies celebrate life’s milestones or just the end of a working week with a beer. Pleasingly, they are doing so more responsibly than ever,” he said.

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