Monday, August 8, 2022

Does craft beer have a labor problem?

Does craft beer have a labor problem? Julie Rhodes, writing at PorchDrinking, sure thinks so. 

She cites low wages and labor conditions as the two main drivers of her conclusion. 

On the issue of low wages, Julie cites the fact the the average brewery production employee takes home less money per year than the average annual expenses of a single person. This fact, she says, demonstrates that brewery employees live at a financial deficit. All of this is before inflation started kicking everyone's butts a few months ago. 

While I'm certain that there are some (a small minority, I'd argue) greedy brewery owners who are paying sub-market wages while raking in loads of profits for themselves, most got into craft beer out of a passion for the libation and the industry, and pay what they can while eking out what they can in a low-margin business. In other words, low wages may be a problem, but it also is a problem that might not be fixable in many breweries without raising prices to the point of being non-competitive.

Julie also cites a variety of industry problems to illustrate poor labor conditions, some of which have been exacerbated by the "Great Resignation." These include long hours, lack of benefits, virus mandates and restrictions, and short-staffed teams, in addition to the on-going struggles of DEI-related issues. You can add to this list the recent news of carbon dioxide shortages fueling potential layoffs within the industry.

How can a craft brewery fix these labor problems? Pay is one part of the solution, but as noted above, most breweries can only go so far on the issue of higher pay. To me, it's a combination of ensuring fair pay for equal work combined with continued efforts to raise management awareness on key issues such as employee burnout, diversity/equity/inclusion, and focusing organizations on a positive and productive company culture. 

What is not the solution for these labor problems? Labor unions and organized labor. I've written previously about why I'm anti-union. To put it another way, unions may obtain higher wages for employees depending on the outcome of collective bargaining, compensation is always tied to the available pie. If the management has already divided that pie as best as it can, for the "wages" slice to get larger employees need to ask themselves what other slices they are willing to sacrifice.

I also don't believe that inserting an intermediary between management and employees fixes the cultural issues that infect some businesses. In fact, driving a wedge between management and workers may actually make these issues worse.  

I'm not as cynical as Julie as to say that craft beer has an endemic labor problem. I'm also not so naive as to think that all breweries are perfect. Labor unrest or unhappiness is a brewery-by-brewery issue. Our industry continues to grow, and with growth comes growing pains. Before we label "labor union" as the solution for all craft breweries, let's also understand that labor unions are not a panacea, and very well could stifle the growth that has helped this industry thrive.