Wake Up Call

Bye-Bye Beer? Americans Drinking Less Beer, Turning to Wine And Liquor Instead

Two decades ago, beer was king around these parts, with nearly half of Americans saying they preferred to drink beer over wine or liquor. But Gallup's new survey of alcoholic preferences shows that number -- and annual domestic production -- was down 20 percent in 2012.

If you look at the number of special breweries, though, it would seem to tell a totally different story. In 1980, you could have counted the country's craft breweries on both hands, but these days, they number in the thousands. So, what gives?

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The answer is simple: The two fastest-growing segments of the country, young people and non-whites, aren't drinking beer.

According to Derek Thompson, senior editor for The Atlantic, there are other factors at play, too. Consider the average beer drinker, a middle-class male voter. Well, blue-collar workers are still struggling, and when they struggle, so does beer. According to Gallup, beer sales dipped significantly immediately after the 2001 recession and even more sharply again when the Great Recession hit a few years later. It's only starting to rebound now, thanks to craft beer.

But that's part of the problem too. Americans aren't just drinking less, they're paying more for it. With the rise of craft beer came the rise of more expensive brews.

"The problem is that we're drinking less of the cheaper, lighter stuff," Thompson said on NPR. "We're replacing it with some of the more expensive craft beers. And that challenges the business model among these sort of larger brewers that depend on middle-class guys just buying six-pack after six-pack after 24-pack of Bud Light."

Yet another factor is that Americans are more health-conscious these days -- and beer isn't the only industry that's suffering from that. Since 2001, research shows that juice, powdered drinks, and soda also are down, but beverages including wine, bottled water and tea have increased in popularity.

Other forces at play include the appearance of liquor ads on television beginning in the mid-1990s and the growth of California wines since the Judgment of Paris in 1976. Both of which may have contributed to changing tastes in favor of wine and spirits and away from beer.

Of course, the big beer companies aren't going down without a fight. They're trying to capture the craft beer generation through special projects like Anheuser-Busch's Project 12, producing small-batch "tribute" beers named for the ZIP codes where they are made. Miller Coors also set its sights on Millennials with a new line of "small batch" fruit-flavored beers released this summer.

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