The report, produced by Oxford Economics for the British Beer & Pub Association (BBPA), revealed that pubs employed 553,764 people last year, with more than half of those employees aged 16-24.
A further 161,046 jobs were generated by the pub supply chain, while spending of direct and indirect wages supported further employment in the hospitality and retail sectors.
In total, the report concluded that pub activity sustained 822,339 jobs, generating £9,534m of wages and £18,315m of GVA across the UK in 2012.
However, there were almost 26,000 net job losses in the pub sector between 2011 and 2012. The report said this was the result of the ‘tough trading environment’ for pubs.
“The share of total consumption of beer in the off-trade continues to grow at the expense of the on-trade, as households face increasingly squeezed disposable incomes by using off-licenses rather than frequenting pubs to the same extent as previously,” it said.
Looking at the wider impact of beer sales on employment in the hospitality sector, the report concluded that on-trade beer sales in restaurants and hotels generated 26,174 jobs, as well as £326m of wages and £501m of GVA in the UK in 2012.
Once brewery and off-trade jobs were taken into account, the beer and pub sector generated 900,000 jobs and contributed £22bn to the UK economy last year.
“Our findings again demonstrate that the importance of the beer and pub sector to the UK economy should not be underestimated,” said Adrian Cooper, chief executive officer of Oxford Economics.
"An important source of employment and output in every region, its activity provides significant tax contributions, investment, flexible working conditions and opportunities for young people to enter the labour market.”
Beer duty freeze
The BBPA hopes the findings of the report will add weight to its call for ministers to abandon plans to raise beer duty by 2.9 per cent in the 2014 Budget
The organisation claims the decision to scrap the escalator and cut beer duty by 1p in the 2013 budget secured 10,000 jobs and boosted confidence in the sector.
However, beer prices remain much higher than Europe, and the BBPA is arguing for a long term freeze on beer duty to protect UK businesses and reduce drinking costs for consumers.
Brigid Simmonds, BBPA chief executive, said: “Beer and pubs provide huge numbers of local jobs, especially for young people.
“Last year’s duty cut made a real difference, saving jobs across the country, boosting investment and increasing confidence. Yet, so much of this good work will be undone if beer duty rises again.
“We need a duty freeze in the Budget, and I hope all MPs will make the case for beer, pubs and jobs, and support Early Day Motion 892 in Parliament.”
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