Report: Wine industry generates $11 billion a year
By BILL KISLIUK
Register Editor
Confirming that the wine industry is a dominant force in Napa County and a significant one for the state and national economy, a report released Wednesday states that the Napa County wine industry generated nearly $11 billion in local economic activity and more than $42 billion around the country in 2006.
The study was released by the Napa Valley Vintners, a trade association of more than 300 local wineries, and completed by Stonebridge Research Group, a Napa-based firm that tracks trends and economic opportunities in the wine industry.
The report takes into account everything from wine industry wages at local vineyards, bottling lines and cooperages to sales at restaurants, retail outlets and through beverage distributors.
It is the second such study of the local wine industry’s economic impact. A survey done in 2002 and released in 2005 showed the industry generated $9.5 billion in local economic activity. The new report finds a 15 percent jump between 2002 and 2006.
“Napa Valley’s wine is the heart of the county’s economic prosperity and certainly its international prominence,” stated the report, completed by Stonebridge President Barbara Insel.
“Napa Valley produces just 4 percent of California’s winegrapes, yet the region is responsible for nearly 30 percent of the economic impact of wine in California, and nearly 34 percent of the economic impact of California’s wine to the U.S. economy.”
The report found that the industry was responsible for nearly 40,000 full-time jobs in Napa County in 2006, where the total population is roughly 130,000, and more than 230,000 jobs around the country.
Local wages earned were roughly $1.5 billion. According to the report, some 3.5 million wine-related visitors spent $714 million here.
The study took into account direct, indirect and what are known as induced economic effects in reaching its conclusions.
Direct effects include employment and consumer spending at wineries, vineyards and through distributors. Indirect effects measure the way the industry creates growth in related industries, such as vineyard nurseries, trucking companies and other suppliers of goods, services and equipment.
Induced effects include private spending by wine industry workers on everything from groceries to health care.
The report states the industry has a “multiplier” effect. “The revenue derived by the wine industry becomes income for other workers and firms, who spend more money on other goods and services.”
Linda Reiff, executive director of the Napa Valley Vintners, said, “Especially during these tough times it is encouraging to know that we have a strong industry helping fuel our local and greater economy. We are also fortunate to have had the support of our community to uphold land protection measures that keep Napa County rural and in agriculture — successful agriculture — which is rare and valued.”
Reiff said that the current economic climate has had an impact on wineries, with some experiencing flat sales and others making modest gains.
“The industry has weathered downturns before,” said Reiff. “This report shows the industry is strong and therefore may be able to weather this one better.”
Register Features Editor Sasha Paulsen contributed to this report.
By the numbers: Napa County wine
A look at annual figures for economic activity of the wine industry.
Wine-related jobs in Napa County 39,900
Wine-related wages earned in Napa County $1.5 billion
Cases of Napa Valley wine produced 9.2 million
Wine-related tourism spending $714 million
Wine-related charitable donations $72.9 million
Local and state taxes paid within Napa County $601 million
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constant comment wrote on Oct 30, 2008 8:16 AM:
Local Yokel wrote on Oct 30, 2008 8:36 AM:
reason-ator wrote on Oct 30, 2008 10:13 AM:
But I did almost get beheaded by a blown re-treaded tire flapping off of a truck hauling grapes. I get to hit the potholes in the roads from the traffic and I get to sit idling at traffic lights waiting for the tourists to clear the intersections.
When will the wine industry finance a study showing us how much the wine industry is costing us ? "
chunk wrote on Oct 30, 2008 11:33 AM:
Born-n-Raised wrote on Oct 30, 2008 12:23 PM:
All I see is negative response's to a industry that provides 40,000 jobs and 1.5 billion dollars in wages to Napa and its surrounding city's. Not to mention 72 million dollars in charitable donations. "
Rob C wrote on Oct 30, 2008 12:51 PM:
Sure - when the day comes you can drill a hole in the bare ground and have wine come out for the next 20 years... "
db76 wrote on Oct 30, 2008 1:05 PM:
pat wrote on Oct 30, 2008 1:09 PM:
And for the record, the wine industry that so many "born and raised" like to bash gives back to the LOCAL community close to 10,000,000 A YEAR. The amount raised at this years Auction Napa Valley was 10,300,000, and yes, it stays in Napa. "
freshair wrote on Oct 30, 2008 1:52 PM:
400 wineries
40,000 employees
5 million tourists
$0 paid in traffic impact fees
Am I missing something? "
born-n-raised wrote on Oct 30, 2008 1:57 PM:
Just to clarify. I was trying to point out that the wine industry is very important for the community. They in fact gave 72 million back to the community last year and I am very appreciative of that. "
born-n-raised wrote on Oct 30, 2008 1:58 PM:
The wine industry pays taxes just like you and me. In fact they paid $601 million in taxes and i'm sure a chunk of it went to fixing roads. "
Rob C wrote on Oct 30, 2008 2:51 PM:
What you are "missing" is that if it wasn't for the wine industry this precious valley would have been carpeted with houses, condos and strip malls a very long time ago.
Instead you get nearly $3 billion in LOCAL wages, spending and taxes to help keep your backyard perch free from all that icky sprawl.
How much did your employers industry pay in local "traffic impact" fees? "
MarshaMarsha wrote on Oct 30, 2008 3:04 PM:
napaoldguy wrote on Oct 30, 2008 4:17 PM:
db76 wrote on Oct 30, 2008 4:23 PM:
vocal-de-local wrote on Oct 30, 2008 4:46 PM:
Be aware that an alcoholic in ICU who's on medicare or is uninsured can cost taxpayers $100,000 or more. The image of alcohol as a ticket to the "good life" costs us dearly. We pay for this on some level in every town or city, no matter how big or small. We are collectively unhealthier because of alcohol no matter how much we are brainwashed into thinking otherwise. We should be alarmed by the levels of these profits because it's indicative of a much greater problem. "
db76 wrote on Oct 30, 2008 4:56 PM:
Rob C wrote on Oct 30, 2008 5:02 PM:
Who do you think pays for half of what you will get in your dotage? Business payroll taxes are half of social security.
So just don't consider corporate income taxes when you think of what companies contribute to society.
Finally, corporate tax breaks designed to add or keep jobs (R&D tax credits, agricultural credits for farmers which funnily enough the wine industry employs, etc.) aren't necessarily a bad thing - just ask anyone employed.
And to come full circle, doesn't everyone on a wine-industry or related payroll pay sales and local taxes, part of which ostensibly go to fix the roads assuming there is any left after paying for service employee benefits and entitlements?
My advice is to drink more wine and less Obama kool-aid... "
whyn? wrote on Oct 30, 2008 5:19 PM:
Rob C wrote on Oct 30, 2008 5:22 PM:
Everybody wants to jump on "windfall profits" bandwagon as panacea. How about somebody standing up for personal responsibility?
Sweeping comments assuring that we are "collectively unhealthier because of alcohol no matter" is alarmist, and plain wrong.
But to the point, anyone care to guess how much the wine industry has donated to health-related activities over the years?
Wealth redistributionists and social engineers everywhere you turn nowadays... "
Rob C wrote on Oct 30, 2008 5:30 PM:
Windfall profits? Check.
Corporate greed? Check
Tax dodgers? Check
Worker exploitation? Check
Social pariah? Check
Oh yes...Potholes? Check
Wow - lets just revoke all the permits tomorrow... "
Rob C wrote on Oct 30, 2008 5:57 PM:
Perhaps because "common sense" would tell you that the economics of lettuce production are completely different than wine.
Must admit though - didn't see that one coming.
Sheesh... "
MarshaMarsha wrote on Oct 30, 2008 6:44 PM:
While I agree with you that without the wine industry this valley would be blacktop and concrete, it is protected for agriculture and not just viticulture.
Doesn't matter if you grow beans or grapes. It's just that producing wine is more "status quo". Grapes produce better revenue for greedy capitalists who are more concerned about which Italian tile to put on the floor of their Tuscan-style mansion rather than condition of the roads. Drink that. "
mofosheee wrote on Oct 30, 2008 7:07 PM:
db76 wrote on Oct 30, 2008 8:11 PM:
napasfinest wrote on Oct 30, 2008 8:26 PM:
my name here wrote on Oct 30, 2008 9:14 PM:
Napa Mom wrote on Oct 30, 2008 9:25 PM:
dire-wolf wrote on Oct 30, 2008 9:39 PM:
MarshaMarsha wrote on Oct 31, 2008 12:09 AM:
Any retired Napa native will tell you more stories about picking plums than making wine. Just a handfull of wineries for decades. Things were all right back then.
And we had good roads, too! "
whyn? wrote on Oct 31, 2008 4:03 PM:
LMW wrote on Nov 4, 2008 9:20 PM:
fedupinnapa wrote on Nov 6, 2008 8:00 PM:
I assume that Bill Gates and Steve Jobs donations to education are simply hush money because the product they sell causes pornography addiction in children and lowers their IQ.
Now to economics. The artical states that the wine industry generated 11 billion in local economic activity not profit! We are talking about money spent at local businesses like browns valley market, restaurants like Pearl owned by great people like the Zellars and many other local owner operated businesses. These people are not rolling in piles of money they are great local Napans working hard to make a living. Read the artical Jobs, Tourism spending, charitable donations, tax revenue.
If you want to complain about the loss of small farms in napa with plums and walnuts then you should look at your need for cheap food driving down the commodity prices starting the boom of industrial agriculture and running out family farms. If small scale plum farming was profitable they may have not converted to grapes. "
109823 wrote on Nov 6, 2008 9:46 PM:
Terry Hall wrote on Nov 7, 2008 2:03 PM:
14obama wrote on Nov 11, 2008 5:59 PM:
14obama wrote on Nov 12, 2008 4:52 PM:
I remember when the San Jose area was all orchards and Napa was orchards and independent,family farms. I enjoy the vineyards in all seasons,but,they get monotonous sometimes. Why they continually make the rows vertical instead of horizontal makes me wonder if they care about erosion. I suppose it would have to be terraced,though or the tractors would be tipping over. "