The craft beer industry — like much of America — is facing a reckoning on two levels right now:
A pandemic ended more than a decade of growth well short of the industry’s goal to become 20% of the national beer market by 2020 and a racial justice movement highlighted craft brewing’s dominant white male culture and lack of diversity.
The combination is leading to sobering conversations within the craft beer community at a time the industry typically gathers in Denver for a toast at the annual Great American Beer Festival.
The Boulder-based Brewers Association that hosts the festival canceled the nation’s largest beer tasting event this year — and it expects to do the same in 2021 — because of the coronavirus outbreak. Instead, GABF will move into a virtual format for two days starting Friday with the presentation of the much-coveted awards.
The diversity of beers entered into the annual competition surpasses the racial diversity in the craft beer workforce and community. The problem is not new, but the focus on the issue amplified earlier this year amid the Black Lives Matter protests and demands from consumers for more significant change within the beer industry.
“I think our trade was slow to think about diversity, and that’s not good,” said Marty Jones, an industry veteran and beer marketer. “But I’m glad it’s become a topic because we have dropped the ball on being a more welcoming trade.”
In Colorado, more than 400 breweries are operating, and just three are Black-owned — Novel Strand and Hogshead in Denver, and Outworld in Longmont. Spangalang Brewing in Denver is in the process of adding a partner, who is Black. In addition, about 10 breweries in Colorado are Latino-owned or focused. The numbers fit national figures from 2018 showing 1% of small and independent breweries are Black-owned and 2.4% are Latino-owned.
The Brewers Association — the trade group that represents independent small brewers across the country — began a program to address the lack of diversity in 2017 that included hiring a diversity ambassador and a grant program. But it took more significant steps in July after facing criticism for not doing enough to address racism actions among its membership.
In mid-June, three weeks after George Floyd’s death in police custody, the association posted a message to social media stating it “stands in solidarity against racial injustice.”
“We strive to create an inclusive community that feels safe and welcome. We will take a stand, we will listen, and we will learn,” the statement continued.
The words didn’t satisfy critics who wanted the organization to take a stronger stand against breweries that use insensitive names for beers or face allegations of racial discrimination. On the other side, the association’s leaders said they lost some members because of the decision to speak out.
In an interview this week, Bob Pease, the association’s president and CEO, defended the association, saying it did “quite a bit” to address diversity in recent years. But he also acknowledged “we were a little bit slow on uptake with the killing of (George) Floyd and the Black Lives Matter movement.”
“We all want a more diverse and equitable craft beer community,” he continued. “And we all have more work to do. We are committed to doing the work.”
In July, the association amended its bylaws to allow for the removal of a member — a provision missing entirely in the prior governing documents. In August, the association introduced a new code of conduct for its members designed to “eliminate discrimination, harassment, and bias of all types.” And in September, the association outlined a grievance process that its professional members can use to police other breweries for violations of the code of conduct.
“We have seen and heard the criticisms and questions surrounding the Brewers Association’s silence regarding racism among its members. We hear you,” Pease said in a July statement announcing the new changes. “Our limited public response to date has not been sufficient for many but it does not equate to apathy.”
Pandemic hurt brewers and industry’s diversity efforts
The conversations about race and diversity in the craft brewing industry come at a difficult time. Earlier in the pandemic, industry outlooks suggested that 60% of breweries wouldn’t survive to June. Those dire predictions proved too pessimistic, as some breweries were able to get financial help or adapt to meet the to-go market, but still more than a dozen have shuttered in Colorado.
The situation remains tenuous, particularly for breweries that built their business on the taproom model selling beers across the bar rather than packaging their beer for sale at retail outlets. In 2019, craft beer volume amounted to 13.6% of the U.S. market, well short of the goals set years earlier in part because of acquisitions from larger brewers.
So far in 2020, overall sales are down about 10%, but breweries’ sales on-premise decreased 40%, the Brewers Association said.
The association is feeling the pinch, too. The cancellation of its events — the Craft Brewers Conference, Homebrew Con and GABF, among others — because of public health concerns cost the organization about 70% of its annual revenue and led to 23 layoffs, or about 35% reduction in staff. The job cuts led to an outcry from brewery guilds across the country and even more criticism of Pease directly regarding his salary and recent hiring decisions.
Other cutbacks included reductions in research spending and the temporary elimination of grant programs, including the one focused on diversity.
Despite the setbacks, Pease is quick to say the association “is here to stay.” The tightened budget and a financial nest egg built from surpluses in recent years will keep it going at a diminished level. “We are resilient. We are scrappy, just like our members. We are adapting. We are improvising,” he said. “But like many of our members, we have been wounded by the pandemic for sure.”
How quickly it bounces back depends on when in-person events like GABF come to life. The association engaged beer fans with a passport to deals at breweries across the nation for $20, but it won’t amount to a fraction of the normal revenue.
“If and when the world gets back to normal — and I say that with a big ‘if’ because who knows what the new normal will look like — but if large events do come back — and we are thinking at this point 2022 at the earliest — we will be fine. We will be right back growing again,” Pease said.
In Colorado, breweries take action to address diversity concerns
In Colorado, the Black Lives Matter movement inspired action on the part of breweries. WeldWerks Brewing in Greeley donated $10,000 to the local Black Lives Matter chapter and Campaign Zero to end police brutality. And dozens participated in the Black is Beautiful collaboration brew that benefited local social justice charities.
“Breweries in Colorado recognize it’s not only a lack of diversity in customers but a lack of diversity in staff and how can they create pipelines to address that,” said Shawnee Adelson, the executive director of the Colorado Brewers Guild.
Station 26 Brewing in Denver partnered with Regis University earlier this year to create a diversity scholarship for underrepresented students to complete the school’s brewing certificate program. The first recipients will be named in 2021.
“The brewing industry is not very diverse,” said Matthew Peetz, the director of the program. “It’s mostly white males, and I think that every industry benefits from a diversity of opinions and background.”
Odell Brewing in Fort Collins recently hired a person to coordinate its diversity, equity and inclusion efforts to address the hiring process as well as educate staff.
Wynne Odell, the brewery’s co-founder and a member of the Brewers Association’s board of directors, said the criticism aimed at the brewing industry was a factor, but “it was also all of us waking up in our own organizations and realizing this is a more immediate concern.”
Jones, the veteran beer industry leader, sees this moment as an opportunity. “It’s only natural that it would become an issue in craft beer. Everyone is taking a look at themselves and wondering if they could do more,” he said.
He added: “What better way to bring people together and find common ground than to talk politely over a couple beers.”