Will the Marijuana boom help weed jobs like it has helped marijuana stocks?
Though the legal marijuana industry is not on every American’s radar, it has a place among the industries experiencing the fastest growth in the U.S.
In a report released last year – “Marijuana Business Factbook 2017” – legal weed sales in the U.S. were predicted to grow 45% in 2018, with sales tripling to an estimated $17 billion by 2021.
So far 2018 has given the industry a boost through California’s legalization of recreational pot and continued organic growth in states where legalization is already in place. Similar growth has been seen in marijuana stocks in Canada.
The increasing favorability toward legal marijuana among Americans has also played a huge role in soaring sales and rising values of marijuana stocks to invest in this past year.
Results from five national polls, from April last year up to the present, supported the overwhelming consensus of Americans toward legalization of adult use pot. One poll in particular, from the Independent Quinnipiac University, cited as much as 94% of the population in support of legal medical marijuana.
In 2017, the legal cannabis industry in the U.S. brought in sales totaling $9 billion. Behind all the money and sales statistics, however, is a far more relevant number for Americans: the employment of 121,000 people.
BDS Analytics estimates this number may double to 292,000 jobs in the U.S. marijuana industry by 2021. This translates to a 25% compound annual growth rate for the cannabis labor force in the U.S. – a virtually unheard of feat in the labor forces of other industries, especially given that the marijuana industry has managed this all while the drug remains federally illegal.
Most of the American public and investors probably view the marijuana industry in a linear fashion – as an industry consisting merely of growers, retailers and distributors – and are unaware of its complexities.
The reality is that the industry also consists of processors, consultants, venture capitalists, delivery companies, event planners and supply chain management providers, to name a few. And all of these facets of the industry present the economy with more job growth potential. Will marijuana stocks rise as well?
So what conditions have allowed the marijuana industry to thrive in spite of the drug’s unchanging federal classification as a wholly illegal substance?
Well, federal regulations may be stiff in the U.S., but state regulations and rules have been loose enough to allow for unprecedented industry growth.
- The Rohrabacher-Farr (or Rohrabacher Blumenauer) Amendment is but one example. Under this amendment, the Department of Justice is not permitted the use of federal funds to prosecute MMJ businesses within legal states.
- The Cole Memo was another of these provisions which offered states a loose structure of rules between August 2013 and its revoking in January this year.
In short, these rules prevented federal government intervention in exchange for keeping weed in the legal state in which it was grown and keeping pot away from adolescents.
But these protections are as thin as they are loose, leaving them vulnerable in the face of attack, the likes of which Attorney General Sessions has been waging on the industry.
Starting with the Rohrabacher-Farr Amendment last year, Sessions requested of his congressional colleagues that it be repealed, unsuccessfully. However, he was successful in rescinding the Cole Memo at the beginning of the year. This action leaves discretion in the hands of state prosecutors for marijuana charges brought against businesses and individuals in legal states.
According to these labor force growth rates for the industry, however, it is clear that supporting a thriving legal marijuana market will continue to have a positive impact upon jobs in this American economy, and particularly with jobs and marijuana stocks in California.
Sessions’ war on weed has raised concern throughout the industry of the future of legalization in the states and its impact on industry growth and marijuana stocks value.
At this point in time, cannabis is legal in some capacity in 29 states, eight of which allow legal recreational-use sales.
(For more information on the marijuana market and job creation, read What Affect Will the Largest Pot-Jobs Creator have on Marijuana Stocks?)