U.P. Exceptionalism: The Case of Craft Beer

The expansion of craft beer production is one of Michigan’s recent economic success stories. The Brewers Association (an organization representing craft brewers) listed 105 craft breweries in Michigan in 2011. By 2024, there were 420 breweries, with most of the industry’s growth occurring between 2011 and 2020. Since then, the numbers have hovered between 400 and 420.

In the Upper Peninsula, the largest concentration of craft breweries is in the Marquette-Ishpeming area, home to the region’s largest population concentration. Smaller clusters of craft breweries are in Sault Ste. Marie, Munising, and the Houghton area. They can also be found in small communities such as Grand Marais and Alpha (2000: population 126).

Paradoxically, the growth in craft brewing has occurred during a period when beer consumption and production is declining. Survey data indicate a drop in beer consumption among young people, while according to U.S. Treasury department data, between 2012 and 2025 U.S. beer production declined 24 percent. Despite this shrinking market, new breweries have recently opened in Manistique, Gladstone and Bark River.

This article explores how the U.P.’s craft brewers are responding to the challenges of declining beer consumption. First a brief explanation is provided for the growth of microbreweries and the reasons behind the recent fall in craft beer production.

Craft Beer’s Origins

Craft brewing is a relatively recent phenomenon, with the first brewery opening in San Francisco in 1965. Twenty years later the number of breweries had risen to 100, and by 2016 there were 5,000. Much of the demand for craft beer is driven by millennials (persons born between 1981 and 1996).

Market research indicates they prefer to purchase products and services from local companies while opposing power and influence in the hands of a few companies (for beer this is represented by the large brewers). Thus, much of the success of craft brewing is attributable to their local ownership and targeted marketing strategies that emphasize local identity and distinctiveness. This is accomplished, in part, by using place names when naming their beers or the breweries themselves.

Blackrocks brewery is named for an area in Presque Isle Park in Marquette, while Cold Iron Brewing in Ironwood promotes its beers by emphasizing that “its brew master has been perfecting the taste of the Northwoods since 2017.” Soo Brewing in Sault Ste Marie sells “Laker Gold” and “Icebreaker” beer as testaments to the region’s geography.

Decline in Craft Beer Production

The 2025 Brewers Association Year in Beer report, highlighted two challenges confronting craft brewers: falling production levels and brewery closings outpacing openings. The Association attributed these developments to increased competition for patrons, changing consumer behaviors, and cost increases due to inflation and tariffs.

Small brewers have been especially hard hit by tariffs on equipment, kegs, aluminum and cans. At the same time, inflation has forced some beer drinkers to reduce their consumption as they become more financially stretched. Before this most recent set of challenges, Michigan’s industry started to show signs of slowing before the COVID-19 pandemic thanks partly to competition from the emerging cannabis market. In 2018, the state legalized recreational use of cannabis, since then beer production has declined 10 percent. 

Changes in Consumer Attitudes Towards Alcohol Consumption

Americans drink less beer than they used to, according to the National Institute on Alcohol Abuse and Alcoholism. Since 1970, the peak year for beer consumption was 1981, when the typical American 21 or older drank 36.7 gallons; by 2021, the equivalent figure was 26.5 gallons per person. This decline is attributable, in part, to changing attitudes towards alcohol consumption among young adults. According to a Gallup survey, the share of young adults who say they ever drink alcohol dropped from 72% in 2001-03 to 62% in 2021-23.

This drop is a response to public health campaigns that emphasize the health risks associated with any amount of alcohol consumption. The other major factor responsible for the decline in drinking among young people according to a Northeastern University professor specializing in the history of alcohol consumption, is social media. A person who drinks too much and loses control is likely to be filmed and that is likely to end up on social media. Avoiding such a scenario is a way to control how a person is represented to the world, including friends, peers, and future employers.

Staying Afloat: Craft Breweries in the U.P.

Increasing production costs and declining demand for beer makes operating a craft brewery challenging. A number of the region’s craft brewers have closed including Superior Coast Brewery in the Soo and Brickside Brewery in Copper Harbor but this has not deterred others from opening or expanding their businesses. The Michigan Economic Development Corporation (MEDC) provided a $3.9 million grant to help the Ore Dock Brewing Company expand in downtown Marquette.

The grant was used to fund the addition of an outdoor entertainment area, urban green spaces, as well as several new apartments. MEDC also helped Saunders Point Brewing restore a historic movie theater and roller rink in downtown Gladstone into a craft brewery that opened in 2024. Several years ago, Blackrocks in Marquette received planning permission to expand its space to accommodate increased production and customers. The region’s latest addition to the craft brewery scene is The Church Brewery located between Escanaba and Bark River. 

One of the strategies used by many breweries to expand their customer base has been to emphasize their role as community gathering spaces. In the case of Saunders Point in Gladstone, the brewery offers live music, trivia, fitness classes, and various collaborations with local businesses and nonprofits. A stroll past some of downtown Marquette’s breweries entails entryways plastered with advertisements for upcoming events including line dancing, live music, exercise classes, and fundraisers; while Upper Hand Brewery in Escanaba is promoting a ‘Boozy Book Fair’ for later this year.

At the same time, to cater to customers not interested in traditional brews, some breweries have expanded their drink offerings to include non-Alcoholic beverages and/or beer with a low alcohol content. In short, for craft breweries to survive it’s no longer all about the beer.

Despite economic uncertainty in recent years, craft breweries continue to persevere in numbers and reach as they provide more than just alcohol, but also community spaces.