Canada's Beer Industry is Brewing up Benefits for the Economy, Report Finds

Beer consumption generated $5.7 billion in annual tax revenues for federal, provincial, territorial and municipal governments of Canada.

OTTAWA -- Beer consumption in Canada and foreign demand for Canadian-brewed beer accounted for $13.6 billion in economic activity in 2016, according to a new Conference Board of Canada report.

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In 2016, Canadians bought the equivalent of 223 bottles of beer per person at beer and liquor stores and other retail stores. Also, the beer economy supported nearly 149,000 jobs across the country in 2016. Beer consumption generated $5.7 billion in annual tax revenues for federal, provincial, territorial and municipal governments. Federal and provincial taxes and liquor board markups account for nearly 47 per cent of the average price of beer in Canada.

"Consuming a Canadian-brewed beer supports many more jobs and businesses beyond the local brewery," said Pedro Antunes, Deputy Chief Economist, The Conference Board of Canada. "No matter where Canadians buy beer, they support jobs across the country in a wide range of industries, including accommodation and food services, wholesale and retail trade, transportation and agriculture."

Despite declining per capita consumption and high taxation, beer remains Canada's most popular alcoholic beverage product, making up over 40 per cent of total alcohol sales through liquor boards and other retail outlets. In fact, Canadians bought the equivalent of 223 bottles of beer per person during 2016. While the overall volume of beer purchased from liquor authorities and other retail stores has remained relatively stable over the past 10 years, per capita consumption has declined by 10 per cent. Reasons for the decline, include demographic changes, increased competition from other alcoholic and non-alcoholic beverages, and economic factors that affect the price of beer.

Most of the beer sold in Canada is brewed domestically, with nearly 85 per cent of beer sales in the country originating from a local brewery. Meanwhile, sales of imported beer accounted for 15.7 per cent of all beer purchased in Canada—up 4.8 percentage points over the previous 10 years.

Spending on beer supported nearly 149,000 Canadian jobs, approximately 0.8 per cent overall employment in Canada, and provided labour income that exceeded $5.3 billion in 2016. The largest concentration of jobs is in Central Canada, with more than 95,000 jobs in Ontario and Quebec supported by the beer economy. More than 19,000 jobs in British Columbia were supported by local beer activity and 13,000 in Alberta. Approximately 75 per cent of these jobs were in retail trade; accommodation and food services; manufacturing; arts, entertainment, and recreation; and wholesale trade.

Beer consumption also generated $5.7 billion in annual tax revenues for federal, provincial, territorial and municipal governments in 2016. Nearly 47 per cent of the average price of beer sold in Canada goes towards government taxes and liquor board markups.

The study was commissioned by Beer Canada. It is publicly available from the Conference Board's e-Library.

SOURCE Conference Board of Canada