Before the COVID-19 pandemic struck, countries across the world the American economy seemed set to exit the doldrums of the past decade. Manufacturing output seemed to be ticking upwards and employment rates were showing steady growth. However, the Coronavirus has dealt employment a severe blow. There are millions of American’s who were gainfully employed prior to COVID-19, but are now collecting unemployment checks – or relying on government assistance. Many of the jobs lost will not be coming back – too many businesses have closed their doors due to the stringent regulations and ‘shelter-in-place’ orders caused by the virus.
At the same time, the legalization of Cannabis is proving a shot in the arm for the tax revenues of the 15 states that have legalized its use – and it has also made a huge impact when it comes to the provision of new opportunities for job seekers.
Recent research by New Frontier Data (a research company specializing in the marijuana industry) has predicted that the national legalization of cannabis would result in up to $105.6 billion in tax revenue by 2025, and, perhaps more importantly in these trying times, create an estimated 1.6 million new jobs.
Several pundits have argued that in times of economic distress purchases of cannabis should decrease as more and more people find themselves cash strapped. In fact, research has shown that sales remain robust even when the economy is in trouble – yet another reason to legalize, cannabis, for all intents and purposes is recession-proof. This means that jobs created by the industry would be (to a certain extent) shielded from economic vagaries.
However, all of this is just crystal ball gazing until one takes a close look at the real world numbers- and they back up what research indicates. In 2019, Colorado collected in excess of $302m in taxes (and assorted fees) from those operating in the state’s cannabis industry. However, Colorado is not an isolated case. Sales of cannabis in California provided the state with 411.3m in excise tax in the years from January 2018 until the end of 2019. In addition, the state also received $98.9m in cultivation tax – as well as $335.1m in sales tax
These monies can be used to fund schooling, public healthcare, infrastructure projects like the building of low-cost housing, and a variety of community projects ) amongst many others).
It is expected that Connecticut, New Mexico, New York, Rhode Island, and Virginia will move to legalize cannabis consumption during 2021. Add to this the fact that cannabis-related stocks have been soaring (always follow the money) it seems inevitable that the trend towards legalization is unstoppable. That is good news for those growing the crop, retailers, and those involved in secondary industries that will service the sector, as well as the millions of unemployed in America.