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Australia’s independent beer brewers deliver $1.93 billion to the national economy

Australia’s independent beer brewers contribute a whopping $1.93 billion in economic output to the Australian economy, according to new research.

An independent report commissioned by the Independent Brewers Association has found Australia’s 600+ independent brewers are an economic powerhouse that is responsible for supporting more than 33,000 Australian jobs.

IBA Chair and founder of Sydney-based Wayward Brewing Co. Peter Philip said Australian independent brewers make a huge contribution to the economy by directly employing approximately 7,000 people.

“This represents 51% of all employment in the brewing industry,” Mr Philip said.

“In addition, for every direct job in the brewing industry, a further 3.8 jobs are created in associated industries such as agriculture, logistics, manufacturing, hospitality and services.”

The growth of independent beer in a relatively short period of time is testament to the tenacity and innovation of these Australian-owned small businesses.

“Australia’s independent brewers grew by 15% in 2020. That’s despite the beer market declining by 1.7% overall last year,” Mr Philip said.

“This demonstrates a consumer shift towards quality beer made by small, local producers who are rebuilding an Australian-owned beer industry.”

As the nation recovers from the impacts of the pandemic, the independent brewing industry is poised for growth with the IBA is forecasting investment of more than $500m in new manufacturing capability, as well as the creation of an additional 6,300 direct and 23,000 supporting jobs over the next five years.

The IBA took the new data to Parliament House in Canberra last week and sought assistance to accelerate job creation and investment in the sector.

“We are asking the Government to work with us to pave the way for accelerated growth,” Mr Philip said.

“We need the Morrison Government’s help to develop a national strategy and make small changes to the tax regime, which is currently stifling opportunity.”

IBA General Manager Kylie Lethbridge says currently about $0.42 in every dollar of independent brewer revenue is remitted in some form of federal tax, which is one of the highest in the world.

“What we are asking is for the Morrison Government to reinvest a small portion of the $220 million in independent beer excise tax forecast to be collected in 2021/22 to create more new jobs and to leverage more than $500 million in capital investment,” Ms Lethbridge said.

“A small contribution today would have a strong multiplier effect on growth and jobs, including in rural and regional Australia, and would ultimately increase the amount of excise collected.

“This is low hanging fruit – it’s an immediate and inexpensive way the Government can achieve its growth objectives and support small businesses through a rough economic period.”

DETAILS OF IBA PROPOSAL:

To realise the opportunities for growth as outlined above, the IBA proposes a number of solutions that can be delivered in partnership with the Federal Government, requiring a small contribution from the 2021/22 budget.

Provision of $300,000 in one-off funding to the IBA to support the development of a national industry strategy. This would provide a 10-year roadmap for sustainable industry growth in areas including domestic manufacturing, employment, regional development and export capability.

Increase the Small Brewers Rebate Scheme from the current cap of $100,000 to $350,000 per year, which would accelerate the competitiveness of small brewers.