A new report from New Frontier Data projects that by 2020 the legal cannabis market will create more than a quarter of a million jobs. This is more than the expected jobs from manufacturing, utilities or even government jobs, according to the Bureau of Labor Statistics. The BLS says that by 2024 manufacturing jobs are expected to decline by 814,000, utilities will lose 47,000 jobs and government jobs will decline by 383,000. This dovetails with data that suggests the fastest-growing industries are all healthcare related.
The legal cannabis market was worth an estimated $7.2 billion in 2016 and is projected to grow at a compound annual growth rate of 17%. Medical marijuana sales are projected to grow from $4.7 billion in 2016 to $13.3 billion in 2020. Adult recreational sales are estimated to jump from $2.6 billion in 2016 to $11.2 billion by 2020.
New Frontier bases these projections on the markets that have already passed such legal initiatives and don't include additional states that could come on board by 2020. Currently there are 25 states with some form of legalized medical marijuana and seven states have legalized recreational marijuana laws that are in various stages of being implemented.
“These numbers confirm that cannabis is a major economic driver and job-creation engine for the U.S. economy,” said Giadha Aguirre De Carcer, Founder and CEO of New Frontier Data. “While we see a potential drop in total number of U.S. jobs created in 2017, as reported by Kiplinger, as well as an overall expected drop in GDP growth, the cannabis industry continues to be a positive contributing factor to growth at a time of potential decline. We expect the cannabis industry’s growth to be slowed down to some degree in the next three to five years, however with projected total market sales to exceed $24 billion by 2025, and the possibility of almost 300,000 jobs by 2020, it remains a positive economic force in the U.S.”
New Frontier based its projections on analysis from the Marijuana Policy Group, which was hired by Colorado for an economic analysis. According to annual surveys of cannabis professionals by the Marijuana Business Daily, the industry already employs 100,000 to 150,000 workers and nearly 90,000 are in plant-touching companies.
Oaksterdam University in California is one of the few formal institutions that trains potential marijuana workers. "The cannabis job market is growing, but many who are interested in the industry have been fearful of prosecution by the DEA. But that is changing," said Dale Sky Jones, Executive Chancellor of Oaksterdam. "A U.S. appeals court recently decided unanimously that the federal government may not prosecute people who grow and distribute medical marijuana if they comply with state laws. While this ruling currently affects states within the 9th Circuit, the decision will influence other circuits across the country. This is huge, as it is very likely that more people will now feel safer about entering the cannabis industry."
Many employees in the industry seem thankful for their jobs and are genuinely happy with their employment. The alternative culture appeals to many who have no interest in cubicle jobs or working for a big corporate giant. It is increasingly pulling professionals from more traditional industries who are looking for new challenges and different work environments.
“The governments and the programs that they've instilled into these (legalized) states have created great job opportunities and excellent business opportunities for entrepreneurs,” said Mark Lustig, Chief Executive Officer of CannaRoyalty. “They've created the right competition.”
I do not own any shares of this stock.
Debra Borchardt, Contributor