Young adults once got married and drank more beer. That is changing.
It's been a tradition in American life. Young adults get married, have children, buy a home and drink more beer. But it's not happening as often as it once did, and that's holding down U.S. beer consumption, Lester Jones said. "We've been hoping ...
It's been a tradition in American life. Young adults get married, have children, buy a home and drink more beer.
But it's not happening as often as it once did, and that's holding down U.S. beer consumption, Lester Jones said.
"We've been hoping to see resurgence in volume demand, in the amount of beer that this country consumes. The reality is, it hasn't happened. We're just not seeing the growth," said Jones, chief economist for the National Beer Wholesalers Association.
Jones spoke Dec. 13 at the Prairie Grains Conference in Grand Forks, N.D. The event was organized by seven Minnesota and North Dakota farm groups, including the Minnesota Barley Council and North Dakota Barley Council.
Beer most commonly is made from barley. North Dakota typically ranks first, second or third in barley production, and the crop is grown in northwest Minnesota, too.
Overall U.S. beer sales were flat in 2016, with the overall beer market totaling $107.6 billion, according to industry figures.
The static market surprised major U.S. beer-makers, who had been expecting an upturn because of big-picture demographics, Jones said.
Employment of young men - who account for the core of U.S. beer consumption - peaked nationally in 1990 and has remained below that since then. Though the U.S. economy generally was strong in the 1990s, the number of young men in Generation X (ones born from the early 1960s to 1980s) was relatively small, holding down overall employment and hurting beer sales.
But the number of male Millennials - people born from the early 1980s to early 2000s, some of whom are reaching legal drinking age - is much larger. As a result, young male employment has been rising, leading to optimism in the beer industry that beer sales would rise, too, Jones said.
The end of the Great Recession, which officially lasted from 2007 to 2009 and put many young men out of work, also was expected to push up beer sales.
The anticipated increase hasn't happened, however.
At least part of the reason is that many young Americans have delayed settling down and raising families. Instead, they remain single and spend disposable income on alcoholic beverages other than beer, Jones said.
That's not altogether bad for barley growers or the beer industry. Sales of craft beer, which uses more barley than mass-produced beer and typically fetches a higher price, continue to rise.
"While beer is flat, the value proposition for the high-end beer has grown and expanded greatly," Jones said.
That boosts barley use. It also expands opportunities for farmers to raise barley - for which they potentially can receive a premium - to meet the specific needs of craft beer-makers, Jones said.
Despite flat beer sales overall, "I'm very bullish on beer's future," he said.
Eventually, many of the young adults who have postponed settling down will do so and drink more beer, he said.
And beer is being sold at more non-traditional locations than ever, Jones said, such as fast-food restaurants and retailers that sell clothing and home furnishings.
"Everything about the alcoholic beer market is changing today," he said.