(LEX 18) — A recent report from the Kentucky Distillers' Association reveals significant growth in the state's bourbon industry, with a $1.6 billion increase since 2024, demonstrating the sector's resilience amid challenging economic conditions.
According to KDA, it is the eighth biennial study of the impact since 2009 and was conducted by Kentucky economist Dr. Mike Clark, "using the latest data from the U.S. Bureau of Labor Statistics, the U.S. Census Bureau, the Kentucky Department of Revenue, the Kentucky Cabinet for Economic Development and more trusted sources."
"We're on a solid foundation here with Kentucky bourbon," said Eric Gregory, president of the Kentucky Distillers' Association.
The bourbon industry continues to serve as a major economic driver for Kentucky, generating $372 million in local and state tax revenue annually. That's an increase of $200 million over the past decade, with the industry now representing a $10.6 billion economic impact while supporting nearly 24,000 jobs across the state.
"We've got the second highest spin-off factor in the state, for every bourbon job that's created, another three are created down the line and that's really important to Kentucky," Gregory said.
However, the industry faces challenges in an unpredictable global marketplace. Gregory noted that current trade uncertainties create additional difficulties for distilleries planning their operations.
"With an uncertain global trade arena especially, it just makes the distilleries' jobs a lot more difficult," Gregory said.
The long-term nature of bourbon production adds another layer of complexity to industry forecasting. Distillers must make decisions today that won't come to fruition for years.
"Every barrel that's filled today isn't going to be emptied and bottled until 2030, 2032 or longer," Gregory said.
Despite these challenges, Gregory remains cautiously optimistic about the industry's future prospects.
"I think a lot of people have been quick to consign Kentucky bourbon to that great liquor store in the sky but the numbers right now don't necessarily back that up," Gregory said.
Kentucky continues to dominate the national distilling scene, accounting for 27% of the country's spirits output and employment. Tennessee ranks second at 8.4%.
Looking ahead, Gregory sees opportunity in the ready-to-drink cocktail market, which has emerged as a significant growth area for the spirits industry.
"We're really trying to provide parity to Ready to Drink Cocktails. That's a huge growth part of all alcohol right now and especially distilled spirits. Numbers came out last week that show that those RTDs are up 16% over the previous year. It's something that can really help our distilleries during these uncertain times," Gregory said.
