Why a Job is Not Just a Job: How Mergers and Industry Changes Are Impacting the Beer Industry | NBWA: America's Beer and Beverage Distributors

In today’s political climate where jobs are a hot topic of discussion, beer distributors have a lot to talk about. Locally operated and independently owned beer distributors serve their state and local communities with reliable and dependable jobs in good times and bad. The topline economic impact numbers for the beer distribution industry are widely available and a useful tool in communicating the economic value of the independent three-tier system. Beer distributors’ $70 billion in economic impacts and 135,000 employees help keep state and local economies stable. But, the story of economic impact goes way beyond just counting jobs, because a job is more than just a job.

For example, consider the men and women who operate heavy trucks and tractor trailers around the country. Beer distributors offer some of the highest wages among all the industries that compete to hire these employees. According to Occupational Employment Statistics data provided by the Bureau of Labor Statistics, a truck driver can expect to earn a mean annual wage of $43,590 across competing industries; however, men and women driving trucks for beer distributors can expect to earn a mean annual wage of $44,500. And this is just a national average comparison. In some states, the average wage paid by distributors is significantly higher, especially where CDL drivers are paid at a premium.

Average Weekly Wages 2016

In fact, the wage differential for beer distributors illustrates why a job is not just a job when it comes to economic impacts within your state or local community. Looking at average weekly wage data reported by the Quarterly Census of Employment and Wages program from the Bureau of Labor Statistics, beer distributors can now say they have the highest paying jobs on average in the beer industry.

Not only are beer distributors paying higher weekly wages of $1,075 per week compared to the total U.S. average of $1,019, wages paid by breweries have fallen to a low of $970 per week.

The dramatic and significant change in wages in the brewing industry can be attributed to two important factors: consolidation and retail brewing taprooms. The continued consolidation among big brewers has led to fewer higher paying jobs at the managerial and corporate level, effectively driving down wages.

Furthermore, the new brewing model for small brewery retail taprooms has effectively created many more hospitality and retail focused jobs within the brewing industry. Remember, more than 92 percent of the breweries in the country today produce less than 7,500 barrels (103,350 cases) of beer annually.

Structure of the U.S. Beer Industry 2015 vs. 2016

When these breweries operate as taprooms or brewpubs, they create more retail/hospitality jobs than manufacturing brewing jobs. Even though they are reported and recognized under the brewing industry, they do not pay the same wages as manufacturing brewing jobs. Today’s brewing environment is changing, and the consequences of consolidation and changes to the industry’s structure are now becoming clear.

From megamergers to new brewers and new brewing business models, the beer industry has changed significantly since 2010. A look at the data illustrates the economic impacts of those changes and – in a world that is increasingly global in nature – reveals the value of locally owned and operated beer distributors, which provide quality jobs for citizens in local communities across America.

Beer distributing also is steady work. The Job Openings and Turnover Survey (JOLTS) gives us further evidence of why a job is not just a job in today’s economy. The JOLTS data provide insights into labor market dynamics, including a comparison of job separation among industries and information on voluntary quit rates that further demonstrate that a distributor job is more than just a job.

The trends in the quit rates cover the time from 2007 to 2016 and include the last recession that lasted from December 2007 through June 2009. The quit rate measures the share of total employees that voluntarily quit their jobs each year. Heading into the last recession from 2007 to 2009, jobs were plentiful, wages were rising and people were much more likely to quit their job in search of higher wages. As the economic situation worsened into 2009 and 2010, the quit rate slowed down significantly – people clearly were not willing to quit their current jobs as the economy got worse. However, once the recession ended, the quit rate once again rose with higher wages and greater opportunity. But, it is important to note that both the manufacturing and wholesaling trades have historically posted much lower quit rates than other industries because of the quality jobs offered in these industries. Their employees are willing to stay through good times and bad. A beer distribution job is more than just a job.