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We’ve all heard the saying, “America runs on coffee,” and there’s a lot of truth to that. In fact, according to the National Coffee Association, 64% of Americans drink at least one cup of coffee per day. That’s a lot of coffee! And it’s not just individuals drinking all this coffee—businesses are, too. Many businesses consider coffee a necessary expense because it helps employees stay energized and productive.
Now that we know just how important coffee is to America, let’s look at how the coffee industry has evolved over the years and how it has impacted our economy. Read more to find out!
Dutch immigrants opened coffeehouses for the first time in America in New York City in the mid-1600s. These initial coffee stores were designed for people to hang out, socialize, and learn about the news. By the early 1700s, there were more than 3,000 coffeehouses in America.
In 1773, the Boston Tea Party occurred in protest of British taxes on tea. This event helped to solidify coffee as America’s preferred beverage because it was seen as a symbol of independence from Britain. Coffee plantations began to spring up in Hawaii and Puerto Rico in the 1800s. At around the same time, Satori Kato, a Japanese chemist living in Chicago, invented instant coffee. Instant coffee quickly became popular because it was easy to make and didn’t require special equipment.
Today, there are more than 25,000 coffee shops in America, and the industry is worth more than $48 billion. The two largest companies in the industry are Starbucks and Dunkin’ Donuts. Together, these companies have more than 14,000 locations across the USA.
The coffee industry has positively impacted the US economy in several ways. First of all, it creates jobs—lots of them! In fact, according to IBIS World, the US coffee industry employs more than one million people. Moreover, many jobs are high-paying positions, such as baristas, roasters, and managers.
In addition to creating jobs directly within the industry, the coffee industry also supports jobs in related industries such as agriculture, transportation, and manufacturing. For example, farmers who grow crops like coffee beans need workers to help with planting and harvesting. And once those crops are harvested, they must be transported to roasting facilities where you can turn them into delicious cups of joe.
Finally, those little creamers and sugar packets need to be manufactured somewhere! The National Coffee Association estimates that the US coffee industry supports more than 1.6 million jobs across various industries.
Not only does the coffee industry support job growth—but it also drives economic growth through taxation. The government imposes taxes on every supply chain step, from farming and transportation to roasting and retail sales. According to Forbes magazine, taxation generated $9 billion for state and local governments in 2015 alone!
The coffee industry is expanding for several reasons. Here are a few of the most critical factors:
There is an increasing demand for coffee globally, which is one of the primary reasons the industry is expanding. According to the International Coffee Organization, global coffee consumption has increased by 60% over the past two decades. This demand increase is driven by several factors, including a growing world population and rising incomes in developing countries.
The coffee industry is also benefiting from innovation. New products, such as iced coffees and flavored coffees, are helping to grow the market. In addition, new brewing methods, such as single-serve coffee makers, are making it easier for people to enjoy a fresh cup of coffee at home.
The expansion of the coffee industry is also being driven by the growth of the specialty coffee market. Specialty coffee is defined as coffee that is roasted to order and has unique flavor profiles. This coffee is typically more expensive than mass-produced coffee, but it is also considered higher quality.
People’s preferences are changing, and they are increasingly looking for fresh, flavorful, and convenient coffee. This has led to the growth of the specialty coffee market, which is now worth $20 billion.
It is also benefiting from the premiumization of the market. Consumers are increasingly willing to pay more for higher-quality coffees. This trend is driven by a growing appreciation for specialty coffees and a desire for more unique and premium experiences.
Overall economic growth is another reason why this industry is expanding. As the economy improves, people have more disposable income to spend on coffee. In addition, businesses are increasingly willing to invest in coffee machines and other coffee-related products.
The industry is increasingly competitive, driving companies to innovate and expand. For instance, Starbucks is now opening drive-thru coffee shops to capture a larger market share.
Finally, the coffee industry is also benefiting from favorable government policies. The government has implemented policies in many countries to support the industry’s growth. For example, the Brazilian government has created a program to help small farmers grow coffee. And in Vietnam, the government has lifted restrictions on coffee exports.
The coffee industry is good for the US economy. It creates jobs, drives economic growth, and supports related industries. In addition, the industry is benefiting from increasing demand, innovation, and changing preferences. With all of these factors working in its favor, the coffee industry is poised for continued expansion in the years to come.
As you can see, there’s much more to America’s cup of joe than meets the eye! Coffee isn’t just a delicious beverage—it’s also a big business that supports millions of jobs and generates billions of dollars in tax revenue each year. And the industry keeps growing with each passing day that will reach places in no time. So next time you reach for another cup of java, give thanks to this humble little bean for everything it does for our economy!