The sizable number of American jobs and career opportunities created from the further legalization of the cannabis industry as well as cannabis-ancillary companies can’t be understated. In only a decade’s time and despite 28 US states still prohibiting fully recreational cannabis, the number of jobs created has been astronomical and would make any sensible politician running on a platform of job creation grin with happiness. And due to the federal policy outlawing interstate commerce, cannabis products are so “locally made” that they’re barred from crossing their own state borders.
For many politicians, such as former President Donald Trump, who’ve run their campaigns so heavily on a policy of creating American jobs, American product creation/manufacturing and American tax revenue, it’s surprising how few of them even slightly mention legalizing cannabis for the vast economic benefits that the industry clearly possesses. The most recent Leafly Jobs Report found a total of over 428,000 jobs have been created from the many facets of the cannabis industry as well as the numerous ancillary businesses, from manufacturing to marketing and cultivation to cash management services.
Even in the chaotic year of 2020 that was entirely consumed and devastated by a global pandemic and strong social unrest, the cannabis industry still created 77,000 different jobs. What’s even more monumental is that from the year of 2021-2022, 107,000 jobs were created from the cannabis industry. In states that still have strictly regulated medical programs such as Florida for instance, the state’s medical cannabis industry still employs nearly 26,000 people. With the addition of Maryland and Missouri going fully recreational and having populations of roughly 6.1 million people each, this furthering of legalization will certainly create thousands more jobs.
However, with the recent nationwide downturn in overall retail sales due to the current recession, layoffs, furloughs and staff cutting measures are becoming frighteningly commonplace in the American cannabis industry. On the East Coast, these layoffs started as far back as July of last year when Pennsylvania cultivator Hanging Gardens laid off 50 of their 110 staff members. Also located in Pennsylvania, a subsidiary of multi-state operator Columbia Care laid off a total of 73 employees.
In Florida, cannabis MSO Trulieve laid off 36 employees and ancillary companies aren’t immune from the large-scale layoffs either. Even if these companies don’t directly handle any cannabis product themselves, their revenue comes from cannabis companies. When the companies that ancillary businesses cater to are suffering, then the ancillary businesses will too suffer. The most extreme and well-known example of this type of layoff happened when massively popular online cannabis marketing company WeedMaps laid off a staggering 25 percent of its entire staff, equaling approximately 175 jobs in November of 2022. Worse even for the company, this round of layoffs wasn’t even the first round of these tragic layoffs that the company had to do. Earlier that year in August, WeedMaps laid off 10 percent of its workforce. In total, that’s a shocking 35 percent of staff being laid off from a single company.
Although, few juggernaut multi-state operators have been so deeply impacted by this economic downtown in the cannabis industry and the subsequently resulting layoffs quite like arguably the largest MSO currently in operation, Curaleaf. Within just the first few months of 2023, the MSO giant has been greatly impacted by the current economic situation in a grave way not seen by many other competing operators of its size and scope.
In a press release from January posted directly on their website, Curaleaf announced devastating news for not only the company but thousands of employees as well. An announcement so grand that it was practically unseen from other multi-state operators. A press release that perfectly embodies how truly troubling and uncertain the current state of both the American economy and the American cannabis industry is.
“Curaleaf Holdings, Inc, a leading international provider of consumer cannabis products,” the press release read, “today announced the proactive closure of the majority of its operations in California, Colorado and Oregon, beginning this month, as part of its continued effort to streamline its business.”
Announcing the closure of nearly all your operations in three major states for cannabis likely isn’t how many people would describe “streamlining business”, but the massive streamlining didn’t only affect states closer to the West Coast. The second major announcement of the press release was that Curaleaf will consolidate all operations in Massachusetts to a single cultivation facility in Webster, meaning that the cultivation facility in Amsbury would soon shut down.
“Today’s announcement reflects a decision that we did not arrive at lightly, and one that makes sense for our business at this time,” said Curaleaf CEO Matt Darin. “We have a fiduciary responsibility to our shareholders to improve margins and fortify our balance sheet by controlling what we can in our business.”
“We believe these states will represent opportunities in the future,” Darin’s statement continued, “but the current price compression caused by a lack of meaningful enforcement of the illicit market prevents us from generating an acceptable return on our investments. We are confident that these moves, made to improve our cash flow and margins, are the right ones to bolster the future success and profitability of Curaleaf.”
In total, approximately 500 people will lose their jobs due to the sudden announcement and payroll across the company will go down 10 percent. Curaleaf admittedly referred to their cost-cutting measures as “aggressive” and mentioned that the main cause of the measures were due to “legislative decisions, price compression, and lack of enforcement of the illicit market.” Especially in California, the mentioning of the out of control nature of the illicit market combined with the laissez faire enforcement of cannabis laws that are detrimentally cutting into the revenues of fully licensed operations shows how prevalent the issue is.
The exodus of the powerhouse of industry that Curaleaf is from three major states for cannabis is perfect evidence into how dire the current state of the cannabis market is. When a small cultivation lays off a handful of employees, it’s unfortunate but not industry-shattering news with the general uncertainty of the cannabis industry given the very still federally prohibited status among other disadvantages. However when a company as widespread as Curaleaf announces not only hundreds of layoffs of employees from a variety of positions but also the shuttering of the majority of their operations within three entire states, it’s indicative of a clearly struggling industry and one that isn’t quite out of the woods of economic struggles quite yet.