Time for a beer change? The rise of micro-breweries and the creative economy. - GWI

Time for a beer change? The rise of micro-breweries and the creative economy. 

Yuccies.

Do you know a ‘Yuccie’? According to New York-based writer David Infante, the Young Urban Creatives, or ‘Yuccie’ demographic are attempting to get rich quick while preserving creative autonomy. Infante cites friends in New York including, “a former financial employee who runs a music festival start-up, an MBA grad who switched to super-niche menswear e-commerce, and a one-time lawyer who now owns a craft beer brewery to illustrate his point”.

While Infante talks about these people through an American prism, we’re sure you’ve met similar types in Australia such as lawyers, doctors and accountants who are now running creative businesses.

Beer – for research, of course.

We opted to do some research of our own to determine whether Yuccies were on the rise in Australia as well.

So we turned to beer. We decided that analysing and sampling the data (not the beer!) related to businesses registered in one creative industry, micro-brewing, would provide a good indication as to the Yuccie phenomenon existing in Australia.

We analysed a number of open data sources available through the Australian Securities and Investments Commission (ASIC) and other Commonwealth Government departments.
At backyard barbeques in days gone by, the beer on offer was likely a state-based brew – in Queensland it was XXXX, in NSW Tooheys and in South Australia, West End. Today paints a very different picture with foreign and boutique beers sharing the ice in the esky.

The number of breweries in Australia has skyrocketed since the 1968 repeal of the Beer and Excise Act which prohibited home-brewing and placed strict regulations on brewing. At that time there were only 18 companies in Australia focused on brewing beer, now there are upwards of 750.

Much of that growth has occurred since 2005, and it only continues to accelerate. More than 40% of breweries currently operating in Australia have been registered with ASIC for less than three years.

This large increase is happening despite a decline in the average consumption of beer per capita. That peaked at 177 litres per year in the early eighties, perhaps coinciding with iconic advertising slogans like “I feel like a Tooheys” and “a hard earned thirst,” and is currently sitting at about 89 litres per year.

The rise of the micro-brewery

These breweries aren’t concentrated in capital cities and so called “trendy” areas either – many new breweries have popped up in places like Mudgee, Tamworth and Port Macquarie.

They are competing not only on the basis of geography but also on the basis of a unique experience. Nail Brewing produced an ale from a melted Antarctic ice sheet, while others have experimented with different ingredients, reviving old recipes and ageing of the beer.

The proliferation of breweries in Australia seems to match Infante’s definition of the Yuccie demographic. He describes them as being Millennials or Generation Y, the first of which reached their mid-20’s in 2005. While the demography of the owners of these breweries is not available through open data, it does appear that the founder stories of many post-2006 breweries align with the Yuccie dream.

The next generation of jobs

So what does this mean? It appears younger Australians are embracing innovation and entrepreneurship, they are backing themselves, their creativity, and creating new industries and jobs.

While this trend strengthens various government innovation agendas, governments need to continue acting on how the taxation system, government grants, employment law and other parts of the ecosystem can work to encourage this entrepreneurship, increase the scale of these operations, and importantly not discourage people in making this leap.

Yuccies in Australia, if encouraged and nurtured, will be the next generation of employers. If the Yuccie dream is crushed by circumstance or government inertia so too will the next generation of jobs.

Dan Wood

Dan Wood

GWI Consuling Manager Julie Kilner

Julie Kilner