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WineAmerica: Wine = Power

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All 50 states have wine producers — 10,637 in all — which preserve the land, hire local people, support suppliers, attract tourists, contribute to their local communities and pay lots of taxes on all levels. Congress knows that.

By Jim Trezise

 

“Wine is the divine juice of September.” —Voltaire

It’s natural to romanticize wine; poets and philosophers have done it for centuries. After all, wine is nature’s grape juice fermented into a magical elixir that enhances food, attracts friends, improves lifestyles and makes us happy. What’s not to like?

It’s less natural to remember that wine is power. 

Wine is a major economic engine that generated $276 billion for the American economy in 2022. That’s 25% above the 2017 level — despite the COVID-19 era in between. In addition, wine is produced, distributed, sold and consumed in all 50 states, attracting investment, jobs, tourism and taxes. As a result, wine is both an economic and political power.

Economic Power: Value-Added Magic

Between the farmer pruning vines and the consumer sipping wines, there’s an incredible array of wine-related businesses, transactions and benefits that flow throughout the economy. WineAmerica hired John Dunham & Associates, a leading economic research firm, to conduct national economic impact studies of the wine industry in 2017 and 2022.

The 2022 study showed that the wine industry generated a total of 1,844,901 jobs, $95.5 billion in wages and $276 billion in total output. It also generated a total of $31 billion in taxes, including $22.8 billion in business taxes and $8.2 billion in consumption taxes. The Dunham study also includes detailed data for all 50 states, and is available on the WineAmerica website.

Wine’s economic impact is measured in three major categories: Direct ( $111.6 billion in total output), Supplier ($76.3 billion), and Induced ($88.3 billion). Direct impact includes everything from the vineyard to the sale; supplier impact involves the thousands of businesses the wine industry supports by buying goods and services; and induced impact involves the many businesses in local communities which benefit from money spent by employees in the two other categories. The fact that the output figures for all three are reasonably close affirms wine’s broad value-added impact.

From an economic perspective, what’s in a bottle of wine? Land, trellises, farm equipment, fuel, labor, harvest machines, crushers, presses, tanks, barrels, bottles, closures, labels, boxes, warehouses, transportation, communication and much else, all involving workers. Those needs, in turn, stimulate the jobs and wages in the supplier sector, which are spent in many local businesses. For a growing industry like wine, it’s all an upward spiral.

Tourism is another unique and powerful benefit of the wine industry. Very few consumer products entice their customers to actually visit the origin in the way that wine does, fueling local economies in predominantly rural areas. In 2022, there were 49.2 million tourist visits to American wineries, generating $16.7 billion in expenditures and supporting 155,035 jobs with $5.4 billion in wages.

Political Power: Investment, Jobs, Taxes

Wine’s economic power also translates into political power, which can increase the economic power through enlightened public policy stimulating industry growth. Wine is a win-win.

New York is a great example. In the early 1980s, the grape industry was in an economic crisis, and the wine industry included only a handful of producers spread among a few N.Y. counties. A few years later, a comprehensive package of legislation saved the grape industry and stimulated some winery growth, but the New York City-based legislators — a vast majority — still couldn’t care less about the state’s wine industry.

An economic impact report in 2003 changed that, showing not only the industry’s benefits to the state economy ($3.4 billion — now $14.9 billion), but also the fact that wine benefited every county due to its value-added power, including jobs and taxes. The state then invested more money through the New York Wine & Grape Foundation, whose activities stimulated industry growth to the point where 59 of the state’s 62 counties now house 470 wineries — including Manhattan, Queens and Brooklyn (where there’s actually a rooftop vineyard).

Wine is a national treasure. All 50 states have wine producers — 10,637 in all — which preserve the land, hire local people, support suppliers, attract tourists, contribute to their local communities and pay lots of taxes on all levels. Congress knows that.

Out of 100 U.S. senators, 100 represent wineries. In the current Congress, several key positions are held by wine country senators, including Majority Leader Chuck Schumer (NY) and several members who chair key committees, such as Patty Murray (WA; Appropriations), Debbie Stabenow (MI; Agriculture), and Ron Wyden (OR; Finance). Through its broad-based membership from 46 states and the State and Regional Associations Advisory Council, WineAmerica has close connections with these leaders and many others in both chambers.

Perhaps the best example of the wine industry’s economic and political power was passage of the Craft Beverage Modernization and Tax Reform Act in 2017, which has since been saving all wineries a lot of money each year through significantly reduced federal excise tax rates. This has let wineries invest in their operations by hiring more employees, enhancing their tasting rooms, buying new equipment and bolstering their marketing programs, among other ways. Since all of those measures are taxed in one way or another, the government wins as well.

Cultural Power: The True Source

Wine wouldn’t be so popular — or powerful — if it wasn’t so good. For centuries, and all around the world, wine has been the beverage that brings people together. It is a sacred part of many religions, the liquid food at family meals, a celebratory elixir at special occasions and a daily pleasure for millions of people. Perhaps California wine icon Robert Mondavi described it best:

“Wine to me is passion. It’s family and friends, It’s warmth of heart and generosity of spirit. Wine is art. It’s culture. It’s the essence of civilization and the art of living.”

Now, that’s power!

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Jim Trezise

Jim Trezise

Jim Trezise is president of WineAmerica (WA), the only national wine industry association in the United States. WA is a 500-member strong organization that encourages the growth and development of American wineries and winegrowing through the advancement and advocacy of sound public policy. Membership is encouraged to support the important work of WA, which benefits all U.S. wineries. Go to wineamerica.org for more information.

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