The value chain of domestic beer creates jobs – also in rural areas

Breweries are of considerable importance in creating jobs and contributing to their local economy. Three out of four Finns (76%) are of the opinion that the brewing industry is a major regional employer and four out of five (84%) feel that the brewing industry generates important tax revenues for society. This information is from a study commissioned by the Federation of the Brewing and Soft Drinks Industry from Taloustutkimus.

The brewing industry directly employs more than 1,700 people at breweries. That said, the entire value chain – from the production of raw materials all the way to the consumer – provides employment for almost 26,000 people. Finnish beer plays a major role in creating jobs in primary production, and the malting barley produced in primary production is an important ingredient in beer. According to the consumer survey, four out of five Finns (83%) reckon that beer is brewed from natural ingredients.

Over 1,000 farmers are employed in the cultivation of malting barley in the Finnish beer value chain. Malting barley is grown in a region spanning from Kymenlaakso in south-eastern Finland to the west coast. In this region, malting barley accounts for one in five hectares of grain. Malting barley is malted in Lahti, from where it is transported to breweries.

“The brewing industry has a major effect on job creation in the Päijät-Häme region. Hartwall’s brewery in Lahti provides direct employment to about 350 people – but its employment effect in the entire value chain is many times that. Vigorous industries create wellbeing for society in the form of jobs and tax revenues,” says Tapio Pajuharju, Managing Director of Hartwall.

Industrial policy that favours employment and competitiveness benefits both society and industry. The entire value chain flourishes when there is growth in added value at the top. A thriving brewing industry generates growth throughout the chain. However, Finland’s current climate with its alcohol tax legislation and taxes does not support the favourable development of industry. Tax revenues should be steered into Finland. However, high taxes spur people to buy their beverages from Estonia and ships. Finland has the highest beer taxes in the EU – four times as high as in Estonia.

“We must keep in mind that taxes impact on companies’ job creation opportunities and willingness to make investments. Taxes must be competitive compared with other countries. Finland’s taxes and regulation differ so significantly from the rest of the EU that they weaken the competitiveness of Finnish companies, hinder employment and put the brakes on the development of expertise,” says Pajuharju.

The Federation of the Brewing and Soft Drinks Industry has emphasised that Finland should respond to travellers’ private imports by lowering beer taxes and permitting the sale of strong beers in grocery stores. At present, 65% of sales of strong beers are accounted for by travellers’ private imports, 19% by Finnish bars and restaurants and 16% by Alko stores. Less than a third of the beers imported by travellers are brewed in Finland.

The survey was commissioned by the Federation of the Brewing and Soft Drinks Industry. 1069 Finns aged from 18 to 79 responded to the survey on Taloustutkimus’ Internet panel from 9 to 15 February 2016. The error margin of the survey is ±3.2 percentage points.

Additional information:

Oy Hartwall Ab
Managing Director Tapio Pajuharju, tel. +358 (0)50 577 4200

Federation of the Brewing and Soft Drinks Industry
Managing Director Elina Ussa, tel. +358 (0)45 269 7711
Communications Manager Outi Heikkinen, tel. +358 (0)50 370 8677

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