The U.S. cannabis market will create 283,422 jobs for American workers by 2020, according to a recently published market research report. New Frontier Data, a cannabis data and research firm headquartered in Washington, D.C., published its
“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, in a statement. “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’s cannabis industry job projections exceed the jobs that the Bureau of Labor Statistics estimates to come from the manufacturing, utilities and government industries. Jobs within each of those industries are expected to decline in the coming years. The BLS expects that by 2024, the manufacturing market will lose 814,000 jobs, while utilities and government will see declines of 47,000 and 383,000, respectively.
The outlook report came on the same day that the Trump administration, despite promising job creation, alluded to a federal crackdown on states with adult use cannabis laws. U.S. Attorney General has since signaled to reporters that there will be no wide-ranging enforcement of federal law and referred to the recreational industry as “valid.”
The nation’s legal cannabis market was worth an estimated $7.2 billion in 2016, according to New Frontier, and is projected to grow at a compound annual growth rate (CAGR) of 17%. The medical cannabis market is projected to grow from $4.7 billion in 2016 to an estimated $13.3 billion in 2020, growing at 13% CAGR over that time. During the same period, recreational sales are projected to grow at a 25% CAGR and balloon from $2.6 billion to $11.2 billion. The current market is currently growing faster than the dot-com surge of the 2000s.
For its job projections, New Frontier utilized estimated analysis data from a Colorado-funded Marijuana Policy Group (MPG) study. MPG’s estimates were used to develop a model for the number of jobs created in the medical and adult use sectors of the first two years of Colorado’s market. This model was then applied to markets throughout the U.S., taking in consideration sale revenue forecasts for each market.
“New Frontier assumed that every state would have a medical and adult use market in place and low barriers to entry. This is an optimal view of the market that demonstrates what potential job creation could be if legal cannabis is operating freely and openly,” added DeCarcer.
Twenty-eight U.S. states have so far adopted medical marijuana programs. Four of those passed recreational marijuana measures last November, bringing the nation’s number of adult use states to eight.
New Frontier’s marketing research reports, including “The Cannabis Industry Annual Report: 2017 Marijuana Outlook,” is available on their website here.