State of the Industry - February 2026
by Lisa Parker, executive director of the NC Craft Brewers Guild
February 19, 2026
North Carolina’s craft beer market has been continually evolving since 1986 with the opening of The Weeping Radish Brewery in Manteo, NC. This marked our state's first microbrewery (ie. craft brewery) post-Prohibition, and the beginning of its modern craft beer movement.
Now, 40 years later, North Carolina has over 400 permitted brewing facilities in operation, generating an annual economic impact of $2.3 billion and supporting over 18,000 jobs (per data published by the Brewers Association.) North Carolina is the #1 beer state in the American South and consistently ranks among the top 10 craft beer states nationwide.
However, over the past several years, the U.S. beer industry has experienced a period of market adjustment and volume declines. Per Matt Gacioch, staff economist for the Brewers Association, “(b)etween 2010 and 2024, (national) per capita beer consumption dropped over 20% from 29.0 gallons per legal drinking age adult to 23.1 gallons/adult annually.” In North Carolina, beer excise tax collections data from the NC Dept. of Revenue, demonstrates a 9.7% decrease in overall beer sales for the state over the past 5 year period, 2021-2025. And, starting in 2024, North Carolina saw closings begin to outpace openings across the state (however 2025’s 21 closures were lower than in 2024 and 2023, with 28 and 23, respectively.)
While opinions vary on any singular cause of this slowdown, it is clear that craft beer has entered a new era resulting from a perfect storm of factors ranging from unsustainable rates of industry expansion to changing consumer habits, with much in-between. Let’s take a closer look…
In 2010, North Carolina had 45 breweries in production. At the start of 2020, we had 330 breweries in production - an incredible 633% increase in brewery openings. During that same period, the overall number of U.S. craft breweries increased by 500% to over 9,500. This incredibly rapid growth resulted in industry-wide investments in manufacturing and capacity.
Following this period of unprecedented expansion came the 2020 coronavirus, creating the most severe global economic crisis in over a century, and bringing its own unprecedented consequences on society. The pandemic caused significant long-term changes in consumer behavior that continue to impact our industry and the hospitality sector overall. Studies continue to demonstrate decreased in-person socialization with reduced out-of-home activities. Remote working arrangements now seem to be here to stay, and have fundamentally altered our downtown communities and commuting patterns - resulting in even fewer opportunities for in-person socialization (ie. fewer beers grabbed with a colleague after work.) ‘
Additionally, the industry is seeing other notable changes in the consumer market:
Economic factors: As U.S. costs of living pressures increase, consumers generally have less disposable income, (per the December 2025 Bureau of Labor Statistics report and January 2026 Social Security COLA), so while consumers continue to spend on household staples, discretionary spending is down - which includes categories such as beer. Additionally, as North Carolina has one of the largest military footprints of any state in the country, with the military and defense industries being our second largest employer, recent government shut-downs and layoffs have certainly put a strain on the consumer market in our military communities.
Health and wellness: An increased focus on health and wellness is causing a shift in the way the U.S. population views alcohol. Craft beer’s original customer base has slowed their drinking habits as they age, and the younger generation is increasingly influenced by the prevalence of social media wellness trends.
Finally, like many manufacturing businesses across the country, North Carolina’s craft breweries have been impacted by increasing operating costs. U.S. tariffs on aluminum and steel have directly impacted the cost of aluminum cans over the past year, as well as brewery equipment and replacement parts. Rising credit card fees, labor costs, and property leasing rates have also impacted already tight profit margins. With 70% of North Carolina’s breweries producing less than 1000 barrels annually, these costs are particularly hard to absorb, and our small and independent breweries don’t have the same options to negotiate bulk pricing or absorb fluctuations in pricing as the larger macro breweries do.
Despite these challenges, we are seeing our breweries tapping into the potential for a new era of growth. From shoring-up business operations and production efficiencies, ensuring premium products, fostering community connections, and providing new pathways for health-conscious consumers to build brand loyalty, craft beer continues to grow, innovate, and serve its communities!
While brewing good beer has always been important, it is now more critical than ever that breweries have a strong financial roadmap and near constant review of day-to-day efficiencies. In talking with brewery owners, and participating in education sessions at this past November’s NC Craft Brewers Conference, it’s clear that our breweries are reassessing the operations necessary for sustainable growth, rightsizing their production, maximizing the ROI on their retail spaces, and exploring creative and collaborative options such as contract brewing and cooperative purchasing, to ensure continued growth into the future.
I still routinely meet young people who tell me that they are just discovering the expansive world of craft beer. While the media continues to portray Gen Z as a sober-leaning generation, the truth is that only 50% of Gen Z (13-28 years old) has reached drinking age, and of those, an even smaller percentage are only just now beginning to approach an age of income earning potential that provides a level of disposable income for premium products. Moving forward, these new beverage consumers will need the same introductions to craft beverages as the general population did in the early aughts - though with a fresh new approach that is tailored for the new generation.
The unique beauty of our craft breweries is that they continue to provide beverage options that meet consumers where they are at. With more options than any other beverage category, the flavors, styles, and alcohol levels of craft beer allow customers to fine-tune their beverage selection to best fit their own personal tastes and lifestyle goals. Additionally, many breweries in our state are now offering an assortment of non-alcoholic beverages, ranging from craft sodas, to espressos, to THC seltzers. These additional beverage options offer everyone who walks into one of our brewery taprooms a “just-right” choice.
Within the communities from the mountains to the coast, North Carolina’s breweries serve as “third-space” hubs, providing a welcoming gathering space for friends and neighbors. Outdoor spaces continue to innovate with fire pits, patios, playgrounds, dog parks, disc golf courses, music stages, and more! Additionally, events like music bingo, trivia, yoga classes, run & cycle clubs, and crafting nights not only provide a healthy dose of activity, but allow their customers to connect with other like-minded people within their communities. In fact, breweries may provide an effective antidote to our current societal problems of loneliness and isolation.
In conclusion, after the past couple decades of explosive growth, we are now seeing the craft beer industry settling-in and maturing as an industry. North Carolina’s craft breweries are truly special places that continue to embody the spirit of local business and community collaboration, not to mention crafting some of the finest beers on the planet!
