November 2017 Issue of Wines & Vines
 
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Wine Industry National Impact Is $220 Billion, Report Says

 
by Linda Jones McKee
 
 

Washington, D.C.—The total economic impact of the U.S. wine industry is $220 billion, according to a study released Sept. 27 by WineAmerica, the National Association of American Wineries. The total includes data from all 50 states and the District of Columbia.

Jim Trezise, president of WineAmerica, told Wines & Vines that this first-ever national study will have impact in national and state capitals, as it gives state-by-state information on jobs, wages, taxes and tourism. He noted that the report will be important for states across the country, because it contains not only an infographic for each state that supplies the basic economic statistics, but also a report describing that state’s wine industry and a page of tables giving detailed data about the direct, indirect and induced economic impacts of the wine industry within each state.

California has the largest economic impact of any one state, with a total of $71.2 billion. The state has 560,000 acres of vineyard and 4,581 wine producers, according to the report, and supports 485,056 jobs and generates $10.8 billion in taxes. The wine industry in the state attracts 23.6 million tourist visits, and those tourists spend $9.7 billion.

The top five states with the greatest economic impact are not the ones often cited because of the number of wineries in the state, the number of acres and/or the largest amount of wine produced. In this study, the top five states are California, followed by New York, Texas, Florida, and Washington.

New York, Texas and Florida don’t have as many wine producers or vineyard acres as Washington, which has 837 wine producers and 56,882 vineyard acres. However, when direct, indirect and induced economic impacts are factored in, all three states have a larger number of wine-related jobs—with more wages paid and more taxes generated—than Washington state.

WineAmerica’s Economic Impact Report is a comprehensive report that evaluates economic impact at three levels: direct, indirect and induced. State reports tend to focus on direct and indirect impacts and often don’t include the induced (or multiplier) effects that are part of the WineAmerica report.

Direct impacts are the jobs, wages and economic output attributed to the industry, including wine grape growers, wineries, wholesalers, retailers, trade associations, research and educational organizations and tourism.

Indirect (or supplier) effects result from firms in the wine industry purchasing goods and services from other industries. These suppliers produce the machinery, parts and other materials used by vineyards and wineries to produce, distribute and sell wine. This category also includes different types of services: agricultural, financial, advertising and transportation services as well as those responsible for regulation.

The report defines induced impacts, also known as the multiplier effect, as the responses by the economy that occur through re-spending of income by employees of the industry and firms with jobs are dependent on the industry.

WineAmerica’s Economic Impact Report is available on the website wineamerica.org.
 

 
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