Kentucky Bourbon’s Impact On State Economy Remains Strong & Substantial
Latest Data Shows Distilling Now $10.6 Billion Industry Supporting Local & State Economies Despite Mounting Headwinds
FRANKFORT, Ky. (February 2, 2026) – As outside threats continue to jeopardize its future growth, Kentucky Bourbon remains a key and substantial contributor to the state’s economy, as a $10.6 billion signature industry supporting nearly 24,000 jobs, a new report shows.
Yet its long-term fortunes remain a roller coaster of uncertainty and unpredictability, threatened by a volatile global trade arena, shifting generational consumer tastes, soaring barrel taxes, and evolving market and geopolitical conditions that have slowed alcohol sales and slashed exports.
The eighth edition of the biennial study using the latest data also shows the distilling industry bought a record 84% of its corn from Kentucky farm families and now generates an all-time high of $372 million in state and local tax revenue.
“This comprehensive analysis demonstrates the economic impact of Kentucky’s homegrown and historic Bourbon industry, which remains significantly ahead in jobs, investment and stature from over a decade ago,” said Eric Gregory, president of the Kentucky Distillers’ Association.
“Bourbon is a long-term business, and the data shows that its Kentucky foundation remains strong,” he said. “But we also must remember that its future isn’t guaranteed and this data is a snapshot in time.
“We need the support of elected officials at every level of government to help create a stable, competitive environment so Bourbon can produce more American jobs, satisfy the global thirst for our signature spirit and continue to invest in our Kentucky home.”
The report was conducted by noted Kentucky economist Dr. Mike Clark using the latest data from the U.S. Bureau of Labor Statistics, the U.S. Census Bureau, the Kentucky Department of Revenue, the Kentucky Cabinet for Economic Development and more trusted sources.
Dr. Clark is Director of the Center for Business and Economic Research at the University of Kentucky and the former Chief Economist for the Kentucky Legislative Research Commission. He takes over the biennial study from Dr. Paul Coomes, who has retired.
Among the report’s top findings, Kentucky’s distilling industry now:
- Contributes $10.6 billion in annual economic impact to Kentucky, up from $9 billion in the previous study released in early 2024.
- Supports 23,935 jobs with $2 billion in salaries, wages and benefits, an increase of more than 800 jobs in the last two years despite recent cutbacks.
- Generates $372 million in local and state tax revenue every year, an increase of $200 million over the last 10 years alone.
- Reports plans to invest another $1.45 billion in the next five years.
- Purchases 3 million bushels of corn annually, of which KDA members say 84% comes from Kentucky farmers, up from 70% in the previous report.
- Has more licensed distilleries than ever before, with 125 locations owned and operated by 104 companies in 45 of the state’s 120 counties.
- Pays a skyrocketing amount of taxes on aging barrels of spirits, including $75 million in 2025, a 163% surge in the last five years alone.
- Stores a record 1 million barrels of spirits, of which 16.1 million are Bourbon.
- Provides the second-highest job multiplier in the state behind the automobile industry, supporting Kentucky farm families, cooperages, truckers and more.
- Dominates the national distilling scene with 27% of both the country’s spirits output and employment, with Tennessee second at 8.4% .
This marks the eighth study of the impact of Kentucky’s distilling industry on the state economy since 2009. “Together, these reports provide a clear, long-term record of Kentucky Bourbon’s growth as a signature industry and the policy challenges that determine its future,” Gregory said.
“Kentucky Bourbon has been around for more than 200 years and overcome its fair share of challenges. By working together, and with the sacred name of Kentucky on every bottle, we must ensure the next report is a toast to progress.”
2026 Bourbon Economy Report Quotes
Kentucky Governor Andy Beshear
“Despite national challenges from tariffs and harmful federal policies, Kentucky’s $10.6 billion bourbon industry continues to show the world its importance by supporting nearly 24,000 jobs and generating a record $372 million in local and state tax revenue,” said Gov. Andy Beshear. “This industry is essential to our success and way of life, and as Governor I’m going to keep standing up for Kentucky bourbon and the hardworking people who make it so special.”
Kentucky Senate President Robert Stivers pointed to the industry’s broadening geographical impact.
“One of the many positive outcomes from the Kentucky Bourbon’s industry’s long-term growth is that rural communities have benefited economically, right alongside our cities,” Stivers said. “There are now distilleries from Pikeville to Paducah and from Augusta to Adairville. Forty-five Kentucky counties now have at least one distillery, with one developing in my home county of Clay. That’s a number far beyond the industry’s traditional core counties where these operations are bringing commerce, tourism and vibrancy to their communities while attracting additional development like restaurants, lodging and retail.”
Kentucky House Speaker David Osborne said the road for Bourbon’s success runs through the General Assembly.
“It should surprise no one that legislative action to modernize our Commonwealth’s alcohol laws, advance responsibility measures and reform taxes to create parity all charted the path for Kentucky Bourbon’s growth the past decade,” Osborne said. “Now Bourbon attracts tourists by the millions, contributes abundantly to our workforce and tax base, and makes Kentucky an envy of other states and nations across the globe.”
Kentucky House Speaker Pro Tempore David Meade tied distilling’s growth to pro-business policies.
“The kind of prosperity and broad impact in this comprehensive study clearly demonstrates what happens when elected leaders pass pro-business policies to unburden a signature industry from outdated and cumbersome policies and punishing taxes,” Meade said.
Founded in 1880, the Kentucky Distillers’ Association (KDA) is the Worldwide Voice of Bourbon
About the Kentucky Distillers’ Association:
Founded in 1880, the Kentucky Distillers’ Association is the legendary voice for Kentucky’s signature Bourbon and distilled spirits industry. Its diverse and growing membership produces the overwhelming majority of the world’s Bourbon, from historic, global brands to emerging micro distilleries that are fostering the next generation of the Commonwealth’s landmark economic engine and its thriving, timeless craft. Member benefits include media relations, international trade development, private sampling events, technical assistance, economic development support, networking, legal defense, marketing strategies, governmental and regulatory advocacy and innovative tourism experiences through the KDA’s world-famous Kentucky Bourbon Trail® and Kentucky Bourbon Trail Craft Tour® adventures. A 501(c)(6) nonprofit organization, the KDA maintains an open membership policy, champions a strong commitment to the responsible and moderate consumption of spirits, and fights to curb underage drinking and drunk driving. Learn more at www.kybourbon.com and www.kybourbontrail.com.
