San Diego County craft brewers produced more than 1.1 million barrels of beer in 2017, up about 22 percent from 2016 levels, according to an economic impact study conducted by the San Diego Brewers Guild and California State University San Marcos’ (CSUSM) Office of Business Research and Analysis.
The total economic impact of the craft brewing industry in San Diego County increased from $870 million in 2016 to more than $1.1 billion last year, according to the study, titled “Economic Impact of Craft Breweries in San Diego County Report.” The study also found that more than 130 San Diego-based breweries generated about $802 million in revenue last year.
More than $806 million of the total economic impact came directly from beer companies in the county that meet the national Brewers Association’s craft brewer definition: small (less than 6 million barrels), independent (less than 25 percent owned by a non-craft brewer), and traditional (a majority of total volume derived from traditional or innovative brewing ingredients).
Much of the industry’s economic impact in the county is derived from breweries in five cities — Carlsbad, Escondido, Oceanside, San Marcos and Vista — along Route 78 within the so-called “78 Corridor,” such as Stone Brewing, the Lost Abbey/Port Brewing, Belching Beaver, Rip Current and Mason Ale Works, among several others.
The direct economic impact of breweries in those zip codes totaled nearly $300 million, while the craft brewing industry’s total economic impact in the area exceeded $382 million.
San Diego County’s craft brewing industry employed 6,275 workers in 2017. More than 4,500 of those workers were employed directly by the county’s craft beer companies last year, with those workers’ income totaling more than $64 million.
Also included in the 20-page report was the latest “Craft Brewers Confidence Index,” a survey aimed at determining the confidence level of brewers in the county conducted by CSUSM students in conjunction with the San Diego Business Journal.
The spring 2018 index reading of 93 indicates a high level of optimism among the county’s brewers, who anticipate hiring more workers, investing in capital projects, increasing production and expanding distribution over the next 12 months.
“Anecdotally, various news articles have challenged whether craft beer has reached its peak,” the study read. “Clearly, craft brewers in San Diego County remain optimistic, despite these articles.”
Since the first survey was conducted in 2015, craft brewers’ confidence levels have only dipped below a reading of 92 once, with an 87 reading in 2016.
Nevertheless, the California brewing industry continued to crowd as more beer companies opened last year. More than 900 California craft breweries were in operation in 2017, and more are in planning. The Alcohol and Tobacco Tax and Trade Bureau (TTB) reported 1,106 active brewery licenses in the state last year, up 19 percent from 2016.
And as of May 2018, the study said 148 independent craft breweries were operating in San Diego County.
A press release with additional details is included below.
California State University San Marcos Study Shows Craft Beer Industry Growth for San Diego County
San Diego, CA (Nov. 11, 2018) — San Diego’s independent craft brewing industry continues to be a powerhouse in the region, with an economic impact of about $1.1 billion in output and $802 million in revenue in 2017. Made possible by California State University San Marcos (CSUSM) Office of Business Research & Analysis, in collaboration with the San Diego Brewers Guild (SDBG), the 2018 Economic Impact of Craft Breweries in San Diego County Report is now available. The full, 20-page report includes information about craft brewers employment numbers, monetary philanthropic contributions and confidence in continued industry growth, which all indicate San Diego craft beer is on track for further success and prosperity.
More than 900 independent breweries were operating in the state of California at the end of 2017, with 130-plus craft brewing locations operating in San Diego County alone. As San Diego craft brewers continue expanding production from 900,000 barrels in 2016 to 1.1 million barrels in 2017, a roughly 22 percent increase, a larger workforce was needed to facilitate that growth. The report found that a total effect of 6,275 jobs and a combined labor income of $171.3 million came from San Diego craft brewers in 2017.
“San Diego’s independent brewers are committed to giving back to the community and helping fuel our local economy,” said San Diego Brewers Guild Executive Director Paige McWey. “As we’ve seen from the study conducted by CSUSM, this includes employing thousands of citizens in their communities. Giving back is such a huge part of the craft brewing culture, whether it be through philanthropy, boosting economies or providing jobs. By supporting local independent brewers and their small businesses, you’re showing your support for all three of those efforts.”
Major philanthropic contributions reflect the importance craft brewers place on supporting their local communities. In 2017, San Diego independent craft brewers donated an estimated $4.9 million to nonprofit organizations, translating to an average donation of 1.35 percent of gross revenue. These totals represent the support of more than 200 nonprofit organizations in the county and 500-plus nonprofit organizations statewide, including those sectors related to environment and community, medical and health, education, and more.
In addition, each semester, CSUSM conducts surveys regarding the overall confidence level of local craft brewers. Using a confidence diffusion index, students determine overall increases or decreases in confidence levels. Since the first survey took place in fall 2015, confidence in the San Diego County craft beer industry has remained high, with anticipations of hiring and investment increases, as well as confidence in production and distribution volume growth, continuing into 2018. The next Craft Brewers Confidence Index will be updated and released later this year.
To view the full 2018 Economic Impact of Craft Breweries in San Diego County Report, click here. More information about the San Diego Brewers and its members is available at sdbeer.com.
KEY FINDINGS AND EXECUTIVE SUMMARY:
Nationwide, craft beer retail dollar sales increased 8 percent to $26 billion during 2017. This sales figure represents 23 percent of the $111.4 billion national beer market.
San Diego still ranks as the top county in the nation with more than 130 independent craft brewing locations.
San Diego County craft brewers produced over 1.1 million barrels (bbl) of beer during 2017, up from 900,000-bbl during 2016.
San Diego County craft brewers produced an economic impact of about $1.1 billion in output for 2017, up from $870 million in output during 2016. This number represents a greater total economic output than Balboa Park and all of its associated activities (i.e. museums, attractions, convention activities, the zoo, etc.) in San Diego.
San Diego County craft brewers generated about $802 million in revenue for 2017, up from $638 million during 2016. In comparison, the San Diego Padres generated about $259 million in revenue.
Recent decreases in federal beer excise taxes have freed dollars for craft brewers to reinvest in their businesses and in the community.
San Diego independent craft brewers’ philanthropic contributions totaled an estimated $4.9 million in 2017, supporting more than 200 nonprofit organizations in the county and 500-plus nonprofit organizations in California.
The report found a total effect of 6,275 jobs and combined labor income of $171.3 million came from San Diego craft brewers in 2017.
All breweries surveyed anticipated an increase in production, distribution and capital expenditures during 2018. These values indicate that craft brewers in San Diego County are optimistic about the future growth and development of their operations.
About San Diego Brewers Guild
Founded in 1997 by a group of brewers dedicated to the growth of craft beer, the San Diego Brewers Guild is a nonprofit 501(c)(6) organization comprised of allied brewery members, tradespeople, and various goods and services providers. Since its founding, the Guild’s mission is to promote awareness of local, independently brewed beer via education, events and community involvement. San Diego (aka The ‘Capital of Craft™’) is home to more than 130 independent craft breweries and continuously garners attention for its medal-winning beer styles and positive international reputation. For more information about the San Diego Brewers Guild and its members, visit sdbeer.com or follow @SDBrewers on Twitter, Instagram and Facebook (facebook.com/SDBrewersGuild).
About California State University San Marcos
Building on an innovative 28-year history, California State University San Marcos is a forward-focused institution, dedicated to preparing future leaders, building great communities and solving critical issues. Located on a 304-acre hillside overlooking the City of San Marcos, it is the only public four-year comprehensive university serving North San Diego, Southwest Riverside, and South Orange Counties. The University enrolls 17,000 students. With approximately 2,000 employees, the institution is a Great College to Work For (The Chronicle of Higher Education). As a recipient of the annual HEED Award since 2014—a national honor recognizing U.S. colleges and universities that demonstrate an outstanding commitment to diversity and inclusion—CSUSM is committed to creating a diverse and inclusive environment. For more information visit csusm.edu.
About California State University San Marcos, Office of Business Research & Analysis
The College of Business Administration (CoBA) in conjunction with the University Library, and the College of Humanities, Arts, Behavioral and Social Sciences (CHABSS) are offering a suite of research services for a fee to benefit small businesses and non-profit organizations. The Office of Business Research and Analysis unites faculty expertise with student researchers to produce Business Plans, Economic Impact Analyses, Econometric Analyses, Geographic Information Systems Studies, Industry Sector Forecasts, Marketing Analyses, and more. For more information visit csusm.edu/coba/obra.