The COVID-19 pandemic derailed years of steady growth in Ohio’s craft brewing industry, according to the Ohio Craft Brewers Association’s biennial economic impact study. The state’s independent craft breweries were responsible for a total economic impact of $880.7 million in 2020, a decline from the $967.1 million generated in 2018. The study, commissioned by the association and conducted by Silverlode Consulting, reports an 8.9 percent decrease in economic impact and an 11 percent decline in craft beer production volume attributable to the pandemic, but an increase in the number of operating breweries and the number of people directly employed by them.
Ohio’s craft beer industry was on a significant upswing through the end of 2019, with economic impact estimated at nearly $1 billion and growing. However, the COVID-19 pandemic dealt a difficult blow to small breweries, many of which rely on by-the-glass taproom sales to drive their bottom lines. Decreased customer traffic, coupled with a shift to less profitable carry out and delivery sales, caused craft’s dollar share of the beer market to dip 22 percent nationally in 2020, according to a report by the Brewers Association.
Even with the tremendous challenges brought on by the pandemic, 2020 saw 47 new craft breweries open in Ohio, bringing the year-end total to a record 357. According to the Ohio Craft Brewers Association study, the state’s breweries directly employed 6,247 people in 2020, up from 6,085 in 2018. This increase is particularly notable considering the labor shortage that hospitality and service sector businesses have been forced to contend with over the past year.
More than 70 percent of the breweries that participated in the survey indicated that they plan to increase beer production over the next two years. Approximately half of the survey respondents plan a facility expansion during the same time frame. Survey respondents reported more than $1.7 million in charitable donations made in 2020, up from $1.15 million in 2018, despite revenue declines caused by the pandemic.
“Craft breweries really struggled to weather the effects of the pandemic, and the fight isn’t over yet,” said OCBA Executive Director Mary MacDonald. “Emergency relief funds and targeted changes to laws and regulations helped many of our breweries survive, but small businesses need continued support if we’re going to see a successful recovery. The economic disruption caused by COVID was massive, unprecedented and affected small businesses disproportionally. The craft brewing industry is unlikely to return to normal until 2022 at the earliest. However, our breweries’ plans to increase production and expand their facilities give us some hope in the near term.”
The full economic impact study report is available at ohiocraftbeer.org.