Australia’s largest beer, cider, wine and spirit producers are reporting dramatic volume declines due to the COVID-19 pandemic. This has clearly translated into Australians drinking less overall, and the sad reality of almost half a million jobs lost in hospitality and $8.5 billion in lost business revenue.
Announcing the release of the Impact of COVID-19 on the Drinks Industry ABA – Industry report on coronavirus report today, Alcohol Beverages Australia Chief Executive Officer, Mr Andrew Wilsmore, said “despite some initial pantry filling in March, April has been the worst month on record for sales of beer, wine and spirits, consistent with ABS data showing consumption has fallen during the COVID-19 crisis.
“Pubs, clubs and bars are shut and there is no sport on TV, no live music or group gatherings allowed.
“The biggest category, beer saw a 44% drop in April and cider saw the biggest decline at 61% due to the loss of social occasions.
“Wine producers are also reporting volume losses of up to 70% among small and medium sized enterprises who rely on restaurants as their main route to market. Major wine brands suffered a small decline in April before falling 16% in the first two weeks of May.
“Local distillers witnessed revenue declines of up to 80% due to the sudden closure of distillery doors and regional tourism in late March. Overall, spirits (21% volume decline in April) and RTDs (37% volume decline in April) show both a tale of woe and resilience.
“We knew that the total loss of trade from pubs, bars, clubs, and restaurants was never going to be made up for by a brief, small surge in panic buying during the week people were concerned bottleshops would also close, Mr. Wilsmore said.
Drinking Behaviours
These volume losses match official data[1] from the Australian Bureau of Statistics (ABS) confirming the vast majority (85.6%) of Australians are drinking responsibly during the pandemic shutdown. Most Australians’ behaviour is either unchanged or they are drinking less during the time of COVID-19.
“The ABS data shows that 30% of Australians are largely abstaining or not consuming alcohol; 47% are drinking the same; and 10 % are drinking less. Only 14% of Australians reported that their drinking had increased.
“DrinkWise sought to dig deeper, commissioning independent research into Australian adults’ experiences of purchasing alcohol and drinking at home, through a nationally representative sample of 1000 consumers.
“Of those who chose to drink, the research found that drinkers were maintaining average consumption of three standard drinks. Over the course of the week, this amounted to just over eight standard drinks in total – well within the official government guidelines.
“For Australians who reported their consumption of alcohol at home had increased, the vast majority continued to drink at moderate levels.
Impact on Jobs
“Our sector has been the most severely impacted by the coronavirus pandemic as lockdowns and social distancing forced the closure of pubs, bars, clubs, and restaurants. The loss of jobs and revenue in this sector has been crippling.
“At the peak of isolation measures, 441,400 jobs had been lost in hotels, pubs, clubs, restaurants, cafes, takeaway, coffee shops, accommodation hotels and casinos. This represents a loss of a third of their total workforce.
“The hospitality sector has seen an $8.5billion fall in revenue, which represents 10% of their annual sales.
“The drinks industry was not immune to these employment effects, given its heavy reliance on hospitality and tourism, experiencing a 15.55% workforce decline that severely impacted the livelihoods of many Australians.
“We call on our political leaders to have a laser-like focus on job creation and minimising regulatory and tax burdens as we come out of this crisis. This will be vital to our successful revival so that we can continue to provide employment opportunities and future careers for young Australians,” Mr Wilsmore said.
Ends.
Media Inquiries: Mr Andrew Wilsmore – 0403 570 407
Audio and video grabs available: https://www.dropbox.com/s/zgj1u8i0qhpqpbf/ABA%20Report%20on%20COVID19%20impacts.mov?dl=0
Infographics from report available on request
[1] https://www.abs.gov.au/AUSSTATS/abs@.nsf/Latestproducts/4940.0Main%20Features629%20Apr%20-%204%20May%202020?opendocument&tabname=Summary&prodno=4940.0&issue=29%20Apr%20-%204%20May%202020&num=&view=