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Manufacturing & Supply Chain

Diageo contributes €13 billion to Europe’s economy every year

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Diageo contributes €13 billion to Europe’s economy every year

Diageo contributes €13 billion to Europe’s economy every year
February 09
10:54 2024
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A new report from Oxford Economics shows that Diageo – a global leader in beverage alcohol, with brands including Johnnie Walker, Smirnoff, Baileys and Guinness – is contributing over €13 billion and 200,000 jobs every year[1] to Europe’s economy, spearheading the spirits industry’s growth in a challenging economic environment.

Diageo is a leader in the spirits sector which provides one of the highest value-adds per job, relative to its size, of any part of the total beverage alcohol sector. The sector offers huge growth potential – with the EU27+’s (31 countries across continental Europe and the British Isles) spirits trade with the Rest of the World accelerating by 54% between 2012-2022.  Although only 1 in 5 alcoholic beverages consumed in the EU+ are spirits, spirits contributed €2 in every €5 in export growth from the region, and Diageo played a key part in that success.

The new study shows the impact of Diageo’s operations in EU27+, and the value the company adds to Europe’s economy as part of the vital wider spirits’ sector. The sector, which includes jobs across manufacturing, distribution and hospitality, contributed €5 billion to EU27’s €13 billion incremental trade in alcoholic beverages with the Rest of the World between 2012 and 2022[2].

The report, Diageo’s Economic Impact in Europe, found that Diageo added €13.2 billion in gross value (including the upstream impacts from its suppliers and downstream impacts through the distribution and sale of their products in shops, bars, restaurants, and hotels) to the economy. For every €1 Diageo received in net sales, it supported a contribution of €3.60 to the GDP of Europe.

It also highlights the productivity of Diageo’s employees, who are 4.1 times more productive than the average EU27+ worker in terms of contribution to gross domestic product. For every person employed directly by Diageo in 2022, a further 8.7 full time jobs were supported by its supply spending.

John Kennedy, Europe President at Diageo, commented: “This report showcases the true extent of Diageo’s significant economic and social impact across the region and demonstrates how important the drinks and hospitality industry is to the economic success and future prosperity of Europe.”

“Europe has always been an important region for Diageo and is home to many of our iconic global brands such as Johnnie Walker and Guinness. As a result, we are proud to be constantly strengthening the partnerships across the region that provide outstanding value to the wider economy through our direct and indirect investment, collaboration and innovation.”

Jake Kuyer, Associate Director at Oxford Economics, commented: “Diageo is an industry leader that generates significant economic impact through its operations in Europe. This has a ripple effect that benefits other industries, with manufacturing, transport, tourism, hospitality, and agriculture all benefiting from its operations, meaning that Diageo’s value is felt across the entire economy.”

Diageo’s presence in Europe is significant.  Directly employing almost 9,000 full time equivalent staff across 22 countries in the EU27+, the FTSE 100 company has 30 distilleries in Scotland, a Dublin-based brewery, distillery, and maturation and packaging facilities in Scotland, England, Ireland and Italy, marketing and supply excellence centres in the Netherlands, a business hub in Hungary, and a global headquarters in central London, all which contribute to generate value for the economy.

Diageo has an extensive supply footprint in Europe that dates as far back as 1759 when Arthur Guinness signed the lease on Saint James’s Gate, Dublin and to the 1820s when John Walker started his whisky brand in Kilmarnock, Scotland.  The legacy continues today with Europe remaining an exporting hub for Diageo, manufacturing whisky, vodka, gin, rum, beer, cream liqueurs, and other spirit-based drinks, which are distributed in nearly 180 countries. One in every 20 alcoholic beverages sold globally is a Diageo product.

[1] Based on 2022 calculations

[2] Source: Eurostat

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