U.S. Beer Industry Blames Trump Tariffs for 40,000 Job Losses

[demmiblue]

Source: Bloomberg

The U.S. beer industry is blaming a jobs hangover on the Trump administration’s tariffs.

A report by two trade groups showed U.S. beer-industry jobs dropped 40,000 since 2016 as metal tariffs boosted aluminum-can costs, leading to a drop in investment. The biennial study by the Beer Institute and National Beer Wholesalers Association said direct, indirect and induced jobs fell to 2.19 million in 2018 from 2.23 million in 2016.

“Aluminum tariffs are increasing brewers’ costs and are an anchor on a vibrant industry,” Jim McGreevy, the chief executive officer of the Beer Institute in Washington, said in an emailed statement. “Each brewer is deciding for themselves how to absorb that expense, whether it’s raising prices, laying off workers or delaying innovation and expansion.”
Aluminum traders expect higher costs to ship metal into U.S. Midwest

The shipping and logistics charge for delivering aluminum to the U.S. Midwest, known as the “premium,” more than doubled as Trump slapped a 10% tariff on imports of the metal. Molson Coors Brewing Co. estimated last year that the levies would create a $40 million hit to its bottom line.

Read more: https://www.bloomberg.com/news/articles/2019-05-23/u-s-beer-industry-blames-trump-tariffs-for-u-s-jobs-decline

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[genxlib]

1. I am all for highlighting the impacts of stupid Trump policies

But their could be another factor here.

It is possible that the Craft Brewing Industry simply hit peak absurdity in that time frame. It was all the rage for every hipster to open his own brewery. You couldn't swing a dead cat without hitting a new brew pub.

I suspect that the numbers cited are simply a natural contraction within and over-enthusiastic industry. Perhaps the cost of materials were one of the factors that weighed on the weak members but I think there were just too many to survive in general.

[customerserviceguy]

2. Well said

I'm sure that MillerBudCoors spends more per can of beer on aluminum than they do on hops.

If aluminum has gotten more expensive because of tariffs, shouldn't the price received for turning in cans at a recyling center be going up, too? I haven't checked for that in my area, but I've not heard any stories about it rising, either.

If the makers of yellow fizzy piss water really want some cheap aluminum, they could surely find places to put up machines where you could turn in cans for cash, just like the ones outside the grocery markets in states that have deposits. Sure, you won't get five cents for a can, but you would have to program the machine to reject anything not aluminum, either.

They wouldn't be any more complicated to run than a network of Redbox movie kiosks. And payment could be made to a PayPal account, or credited to a gift card.

[DBoon]

4. "... credited to a gift card."

a Bud Light gift card maybe?

[liberaltrucker]

5. ...

[customerserviceguy]

14. They could certainly

find a bank that would give them a Bud Light branded reloadable debit card to use for this purpose.

[TheFarseer]

13. Prices for recycling aluminum cans

Have cratered. I quit doing it. Barely pays for the gas to take it to the recycling place. I just put them in the green bucket and let the city recycle it now.

[customerserviceguy]

15. After doing a bit of looking around

I concur in your findings. If the prices of aluminum have risen, so should the prices paid for recycled cans. I think most of it is bullshit.

[Bigredhunk]

3. Hmm

Assuming beer prices have gone up like soda prices here in Iowa.

I know I buy much less soda now than I did even a year ago. The soda sales suck nowadays. Target's Coke sale last week was three 12 packs of 12 oz cans or $12. They also had a promotion - "Spend $20, get $5 off." So if you bought six 12 packs, it would've been $19 with the coupon. That's $3.17 per 12 pack. That's not a deal. To me:

$3/12-pack is passable
$2.50/12-pack is good
$2.00 (or less)/12-pack is as good as it gets

The lowest prices would usually be around holidays like Memorial Day, 4th of July, Thanksgiving. I can't remember the last good sale. I remember stocking up on Mountain Dew a long time ago during a good sale. I gave a bunch to my parents, to which my father quipped, "People don't drink that much pop in a year." He promptly finished it all within a couple of months.

Now obviously you shouldn't drink soda anyway. It's liquid candy. Maybe high prices are good (whether it's this or a soda/junk tax). Maybe it means less diabetes. I'm assuming high smoking prices cause fewer people to smoke (although as a smoking hater I never notice that when I'm out and about).

It's definitely affected my spending.

[sinkingfeeling]

6. Where's the beer industry's government welfare?

[Harker]

7. I would think that farming subsidies

that apply to wheat and rice growers already play a role in the bottom line for some people.

[DeminPennswoods]

8. Beer makers don't have to import any aluminum

There are plenty of empty cans just waiting to be recycled. In fact, brewers could institute a 5 cent deposit on each can returned and probably save themselves a whole bunch of money.

[GoCubsGo]

9. Or, they can go back to using glass bottles, as many already do.

They still need to re-institute the 5-cent deposit on the bottles, too.

[DeminPennswoods]

10. Out this way, recyclers have stopped accepting glass bottles

Either way, we need a national bottle and can deposit law.

[GoCubsGo]

11. Yep, that's another reason to go back to deposits.

They should put them on plastic bottles, as well.

[TheFarseer]

12. We need a national deposit on plastic bottles

I’m sick of seeing plastic bottles littered everywhere

[customerserviceguy]

17. Not gonna happen

There was a flurry of activity among a small group of mostly northeastern states when "no-return" bottles debuted in the mid 1960's, but by 1972, the movement ended. I can't think of any state that has adopted a deposit law since then. I do remember living in WA state in 1972 when an initiative to establish a deposit law was voted down.

Also, possibly a couple of exceptions that I'm not aware of, the deposit amount hasn't budged from a nickle. Back in the days when a six-pack of Coke went for 59 cents, that extra 30 cents was a significant part of the price, that's much less so today. It's now just pretty much a nuisance tax.

[customerserviceguy]

16. I have pretty much stopped buying my beer in bottles

Cans are so much easier to deal with, especially after they're empty. And I still have my glass growlers filled from tapped beers.

[GoCubsGo]

19. I prefer cans, as well.

But, most of what I like comes in bottles. I don't buy it all that often, because it has gotten too expensive. Besides, it just goes straight to my hips, and they're big enough already.

[Igel]

18. One wonders.

If it was a different set of politicians involved if the reaction would be flipped.

So here goes.

1. Beer sales from major breweries--those likely to use cans--is down. Craft brewery sales are markedly up--they're the ones less likely to use aluminum cans. https://www.brewersassociation.org/statistics/national-beer-sales-production-data/

2. In 2016 the Beer Institute--a lobbying organization funded mostly by large breweries, but which is a lobbyist--reported sales up. But also insisted that lower aluminum prices that helped their bottom line were in no way related to foreign market manipulation, evidence for having the claims made by the steel industry for tariffs against dumped foreign steel; as a result of their lobbying, in 2016 steel tariffs weren't imposed because that would have hurt profits. Sales that year were up. And they complained both about excise taxes that increased their costs as well as how wonderful their voluntary labeling was, so please, federal government, stay out. The 2016 report was, of course, for the year *before* Trump took office.

3. In 2018 they pointed out a continuing problem with declining sales due to increased sales of hard liquor and wine. Combined increases and decreases are -0.8%, less than the 2016 increase. But not a huge number.

4. By "beer industry" they don't mean "brewery jobs." They also mean jobs in distribution, shipping, hospitality, etc., etc. The labels obscure the meaning, the new American rhetorical standard for clarity and cryptical thinking (used to be "critical thinking," but that's passe as a form of deception, transitioning from "critical thinking" to "thinking that's just intended to criticize the people I don't like" to "damned obfuscatory&quot .