Manufacturing & Supply Chain

A key report just published by EY (formerly Ernst & Young) and Regioplan reveals that Europe’s brewers can play a critical role in creating employment opportunities for young people, thereby giving a timely boost to the EU’s fragile economy.

According to the report, the EU’s beer sector is responsible for creating 2 million jobs – equal to 1% of all EU jobs – with other sectors such as agriculture, packaging, logistics, marketing, retail and hospitality benefiting considerably from a vibrant and dynamic beer sector.

“This report demonstrates beyond any doubt that the EU beer sector remains a global leader despite the economic challenges that have beset most of the EU since 2008,“ sayd Pierre-Olivier Bergeron, Secretary-General of The Brewers of Europe. “Moreover, the nature of our business means that we can support a flexible labour market that enables job seekers, particularly young people, to acquire quality jobs and play an active role in Europe’s economic recovery.”

Following a very challenging three years at the start of the economic crisis, where beer consumption declined by 8% across the EU, the beer market is now picking up with a modest increase of 1% over two years. Production has also increased by 2% as the thirst for European beer grew not only within the EU but also outside it, with the EU brewing sector’s annual trade surplus reaching €3 billion.

With brewing showing its potential to contribute to the EU’s growth, employment and trade ambitions, it is however important that this potential be supported, not hindered. Nearly 15% of the jobs created by beer in the brewing value chain, primarily those in pubs, bars and cafés, have been lost since 2008 as already difficult trading conditions were exacerbated by sharp increases in VAT rates and excise taxes that particularly hit both sales and jobs in the hospitality sector. Beer excise duties have been increased by 14 Member States since 2010, with France doing so by a massive 160% in 2013.

Latterly however, some governments have recognised both the contribution made by beer to the economy and job creation, and the need to support this, with the UK and Denmark actually reducing beer taxes in 2013 to help solve wider economic problems, rather than seeing the sector merely as a quick source of tax revenue. Whilst in Finland, Italy, the Netherlands, Spain and Sweden, potential increases were either abandoned or reduced in response to a growing awareness of the contribution made by the beer value chain to economic growth and jobs and the negative effects that could result from the proposed tax hikes.