L.A.'s Growing Craft Beer Industry Is Good for the Economy, Report Says

The wall of taps at Uncle Henry's Deli in Downey
The wall of taps at Uncle Henry's Deli in Downey
Facebook/Uncle Henry's Deli

The craft beer industry is growing at a fast clip in Los Angeles County, with more than half of all brewery licenses issued in the last two years. But the economic impact of the expanding market has been hard to gauge, since L.A.'s craft beer boom started a mere 5½ years ago. L.A. is in its infancy compared to more prominent beer cities like San Diego, where a few years ago, while tapping a ceremonial cask at a beer festival, then-mayor Jerry Sanders declared that the industry is "the largest economic multiplier in the county."

Finally, we have some numbers. In Los Angeles, craft beer is on track to generate $66 million of direct economic impact, according to the first report to quantify the subject. The report — released yesterday by the National University System Institute for Policy Research — says that the county's 54 craft breweries and brewpubs have a greater economic impact than Anime Expo, L.A.'s largest annual convention, and that the industry created and sustains approximately 1,334 jobs in the region. 

Of course, this is a drop in the bucket compared with San Diego's annual $600 million of economic impact, as well as the craft beer–driven financial benefits across the state. At the first California Craft Beer Summit, held a few weekends ago in Sacramento, there were posters and pamphlets touting that in 2014, craft breweries in California contributed $6.5 billion to the state’s economy, an 18 percent increase from the previous year. 

"This independently conducted report is a great starting point for those looking to gain perspective on the true economic impact of our L.A. County brewers," says Frances Lopez, executive director of the L.A. Brewers Guild, which currently has 35 members. "Not only does it show the rapid nature in which breweries are opening up shop, but it also sheds light on how many local jobs it contributes to many municipalities within the county."

In addition to economic impact — which was determined through information given by the one-third of local breweries who responded to an electronic survey — the report also projects that L.A.'s craft beer industry will generate $91.5 million in sales and $10.9 million in sales tax revenue in 2015. Next year, these numbers are likely to increase. Numerous breweries throughout the county, including four more in downtown alone, are deep into the planning process. Lopez says an anticipated five more breweries will be part of the guild by early 2016.

The guild is already planning on commissioning its own professional economic-impact analysis within the next few months.

"While the sample size for this report is not entirely reflective of where L.A.'s brewing community is at, it gets pretty close," Lopez says. "We are eager to find out more concrete numbers, which we are certain will be even more impressive in 2016." 


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