Home » Bourbon industry is pouring $9 billion in Kentucky every year

Bourbon industry is pouring $9 billion in Kentucky every year

By The Bourbon Flight

Visitors come to Kentucky from around the globe to experience bourbon, America’s native spirit.

Kentucky Bourbon is expanding its status as a premier signature industry, now pouring $9 billion into the state economy every year and generating more than 22,500 jobs with $1.23 billion in payroll, Gov. Andy Beshear and legislative leaders said today.

Distilling contributes more than $285 million in local and state tax revenue and is in the middle of a massive $5.2 billion capital investment spree that is creating more good-paying jobs and opportunities for supply chain partners, farmers, communities, and tourism than ever before.

“We all know that Kentucky crafts 95% of the world’s Bourbon, and 100% of the Bourbon worth drinking,” Beshear said. “But today’s news proves that our signature spirit is so much more, and the growth is simply staggering.

“Distilleries, jobs, wages, revenue, and investment are up triple digits across the board in the last 12 years. In turn, this amber wave has spurred more corn production, barrel cooperages and other supply-side manufacturers that are sustaining families and adding vibrancy to local communities.”

The news comes from the biennial report conducted by noted economist Paul Coomes and commissioned by the non-profit Kentucky Distillers’ Association trade group. This is the sixth report since 2009 that charts growth and challenges facing Bourbon and distilled spirits.

KDA President Eric Gregory said the study highlights how the industry has effectively transformed itself into a global and economic powerhouse over the past 12 years. “Leadership, partnership, and a focused mission on working together and growing the pie,” he said.

That has included promoting Kentucky as the gold standard for distilling, research, and responsibility; expanding the popular Kentucky Bourbon Trail tourism attraction; welcoming and mentoring craft distillers as the next generation, and working with elected officials to modernize alcohol laws and remove barriers to growth.

The study notes there are now more than 2,200 distilleries in the U.S. due to the booming craft movement. That has slashed Kentucky’s share of distilleries nationwide from 24% to 6%, and jobs from 43% to 30%. Ten states have more licensed distillery operations than Kentucky.

The study’s major highlights include:

  • $9 billion in economic output every year
  • More than 22,500 jobs, up 83% in the last 20 years
  • $1.23 billion in payroll, up 250% in the last 20 years
  • The average salary of $101,567 – the first time that amount has exceeded $100,000
  • KDA distillers bought 17 million bushels of corn in 2020, with 75% coming from Kentucky farmers
  • Corn production has tripled in many Kentucky counties where distillers are located
  • All-time record of 10.3 million aging barrels of Bourbon, the first time over 10 million
  • Bourbon production – number of barrels filled each year – is up 435% since 1999
  • Kentucky distillers filled a record 2.4 million barrels in 2020
  • $5.2 billion in capital projects completed or planned by 2025, including more than $100 million to build or expand Kentucky Bourbon Trail experiences
  • Investments between 2021-2025 will create 4,565 new jobs, $258 million in payroll, and $29 million in tax revenue
  • Distilling has the highest job spin-off factor among the top 20 Kentucky manufacturers by employees; for every distilling job, three more are created
  • The value of distillers’ real and tangible property has quadrupled in the last 12 years to $1.49 billion
  • Kentucky continues to tax distilling higher than all other large industries in the Commonwealth.

Distilling production and consumption generates $286 million in local and state tax revenue annually. That’s $179 million more tax revenue a year versus 12 years ago. Kentucky has the fifth-highest Bourbon and spirits tax rate in the country, and the state’s distillers by far pay more in federal alcohol tax — $1.8 billion — than any other state.

The KDA’s Kentucky Bourbon Trail and Kentucky Bourbon Trail Craft Tour experiences continue their rapid rebound from COVID and closures, up 160% in total attendance from last year and just down slightly from the pre-pandemic record in 2019.

Click here for more Bourbon Flight news.

Click here to sign up for The Bourbon Flight Newsletter.