Alcohol Sales Are Dropping Worldwide: Why Gen Z Is Drinking Less
Around the world, traditional patterns of alcohol consumption are shifting. Once a staple of social life, from bars and pubs to dinner tables and celebrations, alcohol is seeing declining sales in many regions. A key group often cited at the centre of this change is Generation Z—the cohort born roughly between 1997 and 2012. Surveys, market data, and health research increasingly show that members of Generation Z are drinking less alcohol than older generations did at comparable ages. This shift has broad implications for public health, business, culture, and how societies socialize.
In this explainer, we look at the background of the trend, the causes behind it, how it affects people and industries, and what the future may hold.
A Changing Global Picture
Industry reports and economic analyses point to a significant slowdown in alcohol demand in recent years. Major beverage companies have seen dramatic losses in market value—hundreds of billions of dollars wiped off the value of global alcohol stocks—because of decreased consumption and slowing revenue growth.
In key markets such as the United States, population-level drinking has dropped to lows not seen in decades. Long-term polling suggests that less than six in ten American adults now report drinking alcohol, and that proportion continues to fall. While these statistics are geographically specific, similar patterns are evident in Europe, Australia, and other high-income regions—where young adults in particular are drinking less often, and in smaller quantities, than previous generations.
Who Is Generation Z?
Before digging into causes, it’s important to understand the demographic at the heart of this trend.
Generation Z comprises people born from the mid-to-late 1990s through the early 2010s. They’re the first generation to grow up fully immersed in digital technology and social media, and they came of age during the global financial crisis and, later, the COVID-19 pandemic—both events that shaped their economic and social outlooks.
Research consistently shows that Gen Z, on average, consumes less alcohol per capita than prior generations such as Millennials or Baby Boomers. In some surveys, Gen Z individuals drink around 20% less than Millennials, and nearly half of young adults aged 21 and above report never having had an alcoholic drink.
Why Gen Z Is Drinking Less
There is no single explanation for this shift. Rather, multiple interlinked factors help explain why many members of Generation Z are drinking less than young people of previous generations.
1. Health and Wellness Awareness
Gen Z places unusually high emphasis on physical and mental health. Many see alcohol not just as a recreational choice but as a potential health risk. Concerns about anxiety, sleep disruption, long-term disease risk, and weight management make alcohol less appealing to health-conscious individuals.
This health-first mindset also aligns with broader cultural trends: regular exercise, balanced diets, mindfulness, and mental health care are often seen as part of a holistic lifestyle. As one analysis noted, younger adults are more likely to ask whether they need to drink at all, rather than how they can drink “responsibly.”
2. Economic Pressures
Economic factors also play a role. For Gen Zers coming of age in a world marked by rising living costs, student debts, and constrained incomes, alcohol—particularly in social venues like bars and clubs—can be expensive. Cutting back on alcohol becomes one of many ways to stretch a budget, especially when discretionary income is limited.
3. Evolving Social Habits
Social interaction itself has changed. Virtual socialising, video streaming, gaming, and other digital leisure activities take time and attention away from traditional nightlife. For some young people, gathering over a coffee, outdoor game, or shared meal may feel as meaningful as a night of drinking.
Peer culture plays into this too. Where older cohorts might have seen heavy drinking as a social norm or a rite of passage, many in Gen Z openly embrace sobriety or “mindful drinking”—a conscious choice to reduce or eliminate alcohol consumption. This trend sometimes falls under what’s been dubbed the “sober-curious” movement—a mindset that questions alcohol’s place in life without necessarily committing to total abstinence.
4. Mental Health Awareness and Social Stigma
Better mental health education and less tolerance for unhealthy coping mechanisms also factor in. Unlike previous generations, many Gen Zers are more likely to discuss the downsides of alcohol on mood, anxiety, and behaviour. Coupled with social media, where embarrassing or risky behaviour can be widely shared, there’s a heightened awareness of alcohol’s social and psychological effects.
Broader Impacts on People and Society
The shift in drinking behaviour has numerous ripple effects.
Public Health
Reduced alcohol consumption can yield public health benefits. Alcohol is linked to a range of chronic diseases, injuries, and social problems. A generation that drinks less may see lower rates of liver disease, addiction, and alcohol-related accidents over time. Public health experts often cite these patterns as positive indicators for future population health.
Social Life and Culture
Alcohol has long been embedded in social rituals, from birthdays and weddings to casual evenings out. As drinking declines, social norms around leisure and celebration evolve. Some nightlife venues report that younger crowds drink less, preferring other forms of entertainment.
However, this shift isn’t universally welcomed. Certain local cultural spaces that rely heavily on alcohol revenue—such as bars, clubs, and restaurants—are facing financial strain. Restaurateurs and chefs have noted that because alcoholic drinks can make up a significant portion of their revenue, reduced demand poses a business challenge.
Industry Dynamics
The global alcoholic beverage industry is responding to these shifting tastes. There’s growing investment in low- and no-alcohol products, including alcohol-free beers, seltzers, and mocktails. Analysts see this as both a reaction to changing consumer behaviour and an attempt to capture segments of the market that traditional products have left behind.
Meanwhile, major producers grapple with excess inventory and declining demand for traditional spirits, prompting adjustments in production, pricing strategies, and marketing approaches as they seek relevance in a new consumer landscape.
Future Outlook: What’s Next?
Predicting the future of alcohol consumption is inherently uncertain. Trends can evolve as social, economic, and cultural conditions change. But current data and expert views suggest some plausible patterns:
Sustained Change or Cyclical Rebound?
Some analysts view the decline in youth alcohol consumption as a long-term cultural shift. Others caution that patterns may change as Gen Z ages and proceeds through different life stages. For example, as disposable incomes rise and work-life pressures change, some level of increased alcohol consumption in later adulthood is possible—though it may not return to the patterns seen in older generations.
Health and Wellness Remain Central
Regardless of future fluctuations in drinking frequency, the underlying prioritisation of health and well-being is likely to persist. This suggests that demand for healthier drinking alternatives and lifestyle choices will continue to shape industry innovation and cultural norms.
Innovation in Social Spaces and Beverages
We may see new social venues, events, and products tailored to those who want social connection without heavy reliance on alcohol. Non-alcoholic beverages, functional drinks, and lifestyle brands that align with well-being and community may continue their growth.
Conclusion
The worldwide dip in alcohol sales and the marked reduction in drinking among Generation Z reflect a complex interplay of economic, cultural, and personal factors. For many young adults today, alcohol simply no longer holds the central place in social life that it once did.
This trend carries significant implications—from healthier individuals and reimagined social spaces to major shifts within the beverage industry. Whether these patterns persist or transform over the coming decades, they mark a clear generational shift in how people relate to alcohol: one that prioritises well-being, thoughtful consumption, and evolving social norms.