Report Suggests Alcohol Consumption On the Rise as Depression Deepens

According to the September 2010 Monthly Wholesale Trade: Sales and Inventories [PDF] report released by the U.S. Census Bureau, alcohol consumption may be on the rise.

The change from August 2010 to September 2010 shows alcohol inventories at major wholesalers were depleted by 1.5%, while at the same time, overall inventories across durable and non-durable goods increased at about the same rate.

As wholesalers’ inventories on goods like cars (+0.9%), furniture (+0.7%), and apparel (+4.0%) increased, alcohol and groceries were being used up faster than wholesalers could restock their shelves.

Robert Barns of Investopedia, says that the Monthly Wholesale Trade report is based on a nationwide survey of 4500 major wholesale merchant organizations. The data is broken into 16 – 20 different industries that stock and distribute durable and non-durable goods. The inventory-to-sales ratios within the report are used by investors to help identify “supply/demand imbalances that exist in the economy.”

Sign of the Times

The high unemployment rate and continued fear that the US economy will fall back into recession, or that the recession never ended and a depression has taken hold of the country, may contribute to increased alcohol consumption.

A recent study published in the British Journal of Addiction found that unemployed men are exposed to greater risks from drinking alcohol. “Unemployed males were particularly likely to binge drink and to report adverse effects from consuming alcohol,” said the report.

With official unemployment hovering near the 10% mark, and millions of Americans reaching the 99 week limit on emergency benefits over the course of the next few months, the liquor industry seems likely to benefit as one of the few recession-proof businesses capable of withstanding decreased consumer spending in the broader economy.

References: Census Bureau, Investopedia, Zero Hedge, DUI.com, Unemployment and Drinking Behaviour