The Economics of Beer: Still Recession Proof?

There are a few guilty pleasure blogs that I follow, and one of them is A Good Beer Blog who points to this interesting piece in the Washington Post - Cold Comfort in Hard Times:

More than 16 million barrels of domestic beer were sold in the United States in July, and annual sales through that month are up 1.4 percent, the largest increase since 1990, when the economy was headed toward a recession, according to the Beer Institute. (Yes, such a thing exists. It's a trade group.)

The uptick is significant for a mature industry with roughly $50 billion in annual sales, particularly as consumers reduce spending on other discretionary purchases, such as venti lattes and designer jeans. Trade groups for the liquor and wine industries report consumption of those beverages has also increased. But beer is America's most popular alcoholic beverage, claiming more than half the market, and the go-to drink during these times of economic distress.

"The beer industry and the alcohol industry seem to be fairly recession-resistant," said Nick Lake, vice president of beverage and alcohol at the Nielsen Co., a market research firm. "Why would you want to cut out beer? You don't want to punish yourself just because the economy's bad."

More interesting stuff follows but this was my favorite bit of reasoning:

"You can stay home and entertain and have a high-quality beer for a fraction of the price of going out with your friends," said Ben Sibley, manager of the company's store in Chantilly.

That's why Trevor Langrehr keeps a keg at home. Each keg usually lasts a few months, and his buddies can enjoy a fresh, ice cold beer when they visit his new house in Fredericktown, Va. He even converted an old fridge into a "kegerator."

On a recent afternoon, he returned an empty barrel of Dominion Lager to the Total Wine & More in Chantilly and picked out a keg of Sam Adams Oktoberfest for $149.99. His beer-buying habits haven't changed, though he cut his monthly gasoline bill from $500 to $250 by getting a Volkswagen that runs on diesel. If the economy got really bad, he knows he would have to cut back.

"I'd certainly chose food over beer," he said. "But I hope that never happens."