As the number of farm and rural breweries has grown, I have recently received several inquiries about whether rural breweries have grown in popularity in recent years. In absolute terms, the answer is an unqualified yes, but that answer is quite unsatisfactory, since breweries have simply increased everywhere. So, prompted by a pointed question on Twitter, I decided to look at the number of breweries based on the population of various locations over time.
To do this, I use Census Bureau data on urbanized areas and clusters. Urbanized areas are regions of 50,000 or more people, and urban clusters have 2,500 to 50,000 people. Everything else is considered outside of an “urban” area – so this definition of rural will include small towns of less than 2,500 people that are not associated with a larger urban area.
(PLUS: Number of American breweries)
Rural breweries increased overall but decreased in percentage
The results are fascinating and show that as a percentage, the number of breweries in rural areas and smaller towns with populations under 2,500 has actually declined as a percentage of all breweries since 2013, despite a 129% growth in many of these breweries. (note that total brewery growth has been 142% since 2013). I used 2010 Census population data for both time periods – if there was updated data by location and year, that might change the results slightly.
Breweries per 100,000 inhabitants
|Pop (2010 census), urban areas||2013||Running||% Ch|
|Not in an urban area of 2010||0.44||1.00||129%|
|Non-urban as % of total||8.9%||8.4%|
A big caveat on the data table above: a different method of analysis yields a higher number of rural breweries. For the table I used zip + 4 translated to urban areas via postcode tab areas. For current data, as a check, I also performed a Geographic Information System (GIS) analysis using ESRI’s ArcGIS Online. Although the results are very strongly correlated, the GIS analysis revealed that a much higher percentage (15.6%) of breweries are located outside of the urban areas defined by the Census Bureau. The difference is likely due to the higher sensitivity of the GIS analysis and the fact that many breweries are just outside the city limits, but still within the ZIP codes covered by those cities. Because I can’t create a comparable 2013 GIS analysis, I’ll focus on the zip code analysis. That said, the GIS map is cool (it’s a technical term), so here it is. Click on an urban area and see how many breweries it has!
Breweries by urban area
Compiling this data leads to a very interesting secondary conclusion: the number of breweries per inhabitant is in fact inversely proportional to the urban population. For larger urban areas, this makes a lot of sense. Not only are these places usually quite expensive, but they will already have a very competitive landscape of food and drink options. Currently, there are only 100 more breweries in the most populated urban areas (5M+) than in rural areas/smaller towns.
What I find more interesting is that the per capita numbers continue to rise as the population declines, and urban clusters of 2,500 to 10,000 people actually have the most breweries per capita. These areas have 7.6% of the country’s breweries, despite only representing 3.5% of the US population (although their population could be larger if you include outlying rural areas that use these clusters for services). commercial). I won’t pretend to have a good explanation for this finding, but I’d bet it’s a combination of lower costs, easier entry (via zoning/regulation), and lower competition. For some places, I could also see tourism playing a role, but I doubt that a high percentage of cities of this size are tourist destinations. Finally, as the difference between GIS analysis and ZIP analysis has shown, it is possible that many small towns are “larger” than their defined population and may in fact tap into a larger population base of peripheral rural areas. That said, I am always open to other explanations for this finding.
State is always a better predictor than population
A caveat to any potential brewery entrepreneur looking for a location: these population results are much weaker than the state effects. Although this analysis is a bit messy since some urban areas cross state lines, the size of an urban area is no longer a statistically significant explanatory variable for breweries per capita when included in a multiple linear regression. which controls the state (the state variable is highly significant). Translated into English – knowing what state an urban area is in will be a much better indicator of the number of breweries per capita in a city than the number of people (population of course counts for the total number of breweries).
So, to sum up, while the number of rural breweries has certainly increased, this increase is consistent with the overall growth of breweries in the United States. It will be interesting to observe these trends in this more competitive environment. As the data shows, these regions have even fewer breweries per capita, but obviously much less density to draw from. It will also be interesting to observe the closure patterns. As one Twitter user suggested, it’s possible that smaller towns are “canaries in the coal mine” of the brewery because of their smaller populations. Definitely something I will delve into when we compile the final opening and closing numbers for 2018.