Grapes and wine have significant impact in New York, study reports

For every $1 million the state provides to boost the grape and wine industry in New York, it gets $1.3 billion back in taxes, according to an economic impact report that just came out.

Sam Filler
Sam Filler

The report compiled on behalf of the New York State Wine & Grape Foundation concludes that the industry had a $6.65 billion impact on New York’s economy in 2019, including jobs and wages, expenditures to support the industry, and sales of grape and wine products.

“I’m encouraged that the industry continues to grow and it’s an important contributor to the state’s economy, especially in the rural parts of the state,” said Sam Filler, executive director of the foundation.

It’s difficult to make side-by-side comparisons with this 2019 report and others, as a previous report the foundation commissioned in 2012 used entirely different methodology, Filler said. That report indicated an impact of $4.8 billion from the New York wine and grape industry, but it didn’t include the foundation itself or the research dollars and wages surrounding grape and wine research at Cornell AgriTech, Filler noted.

A 2017 national report by Wine America showed the wine industry had a $13.8 billion impact on New York, but again used a different methodology. That report didn’t include juice grapes, and did include out-of-state wines sold in New York.

Filler said the national report’s New York findings included, for instance, sales offices in New York established by large California wine brands. The foundation’s report was aimed solely at determining the impact of the home-grown industry, especially direct impact.

“Those are actual jobs and actual tax revenue and salaries paid that are directly attributed to the presence of the New York state wine industry,” Filler said. Such data helps when seeking additional support from state economic development sources, he said.

Both the latest New York report and the 2017 national report were conducted by John Dunham and Associates, a Brooklyn economic research firm.

John Dunham, managing partner of the firm, said the report shows “The New York wine industry is really quite healthy—it’s growing in terms of revenues. It’s not growing jobs as fast, but that’s expected in most manufacturing” sectors. The number of jobs were flatter than they might have been, Dunham said, because Constellation Brands, headquartered in Victor, sold some of its wine brands to Gallo, moving some of the associated jobs to California.

The modeling used to account for jobs in the foundation’s report is more realistic, Dunham suggested, because it’s tailored to the state rather than using a mathematical formula that cuts a national model down to the state level.

Key findings of the foundation’s 2019 New York report:

  • The industry is directly responsible for the full-time equivalent of 71,950 jobs. Many of the industry’s jobs are seasonal.
  • Those jobs paid $2.79 billion in wages.
  • Some 1.43 million people visited wineries and vineyards in the state for a total of 4.71 million.
  • Wine-related tourism resulted in $1.33 billion in other kinds of spending, such as lodging, food and transportation.
  • Total taxes, including state, local and federal, from the industry were $2.4 billion.
  • The state had 471 wineries in 2019, an increase of about 30 since the 2017 report and more than 170 since the 2012 report.
  • New York has about 35,000 acres in grape production with just over two-thirds of them devoted to Concord grapes, which are primarily used for juice instead of wine, and a little less than one-third planted with grapes destined to make wine. A small percent of acreage was devoted to fresh grapes.

Though grape juice production is larger than wine production in terms of volume and acreage, the report indicated that wine production is much more lucrative, starting with the value of the grapes. Wine grapes tend to sell for up to eight times the price of juice grapes, depending on varietal.  Additionally, wine production promotes tourism, produces products of higher dollar value than grape juice and involves retail interactions at the wineries themselves.

“Selling wine continues to be an important way for wineries to contribute to their businesses and interact with consumers,” Filler said.

Still, the report noted, grape juice production is not to be overlooked.

“All told the grape juice industry in New York is responsible for 688 jobs, paying almost $39.28 million in wages. Over $154.22 million in economic activity in New York is due to the grape juice industry,” the report said.

A study on economic impact of the grape an wine industry in 2019 includes research and development work such as the breeding done for Cornell's Bruce Reisch.
A study on economic impact of the grape an wine industry in 2019 includes research and development work such as the breeding done for Cornell’s Bruce Reisch.

For the first time, data was collected on a county-by-county and legislative districts, Filler said, providing some interesting takeaways. Those more detailed reports showed Yates County, the third-least populous county in the state out of 65 counties or boroughs, is the center of New York’s wine country, he said.

“Yates is the heart of the industry in terms of vineyards planted,” he said, with about 5,000 acres under cultivation. Not surprisingly, Yates also had the most vineyard jobs to tend those vineyards.

The county’s unique geography also makes it part of three different Finger Lakes’ wine areas – Canandaigua, Keuka and Seneca – and places it at the center of the entire Finger Lakes Region, the largest wine region in the state.

Filler also said he was not satisfied with available data on vineyards, as federal agriculture censuses only look at two categories of grapes: Concord and all other types. As a result, the federal census provides little information on whether types of wine grapes planted are growing or changing, for instance.

“We need more accurate vineyard data in terms of what’s planted in the state,” Filler said. “That will help us better tell the story of what’s happening in the NYS wine industry.”

The foundation conducted a supplemental survey, but it wasn’t ready in time to be included in this economic analysis, he said. And any survey relies on voluntary efforts of the growers to complete. The industry may have to foot the bill to create a more complete survey to which growers will be willing to devote their time, he said.

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