This story was originally published on Crain Chicago and was written by John Pletz.
The Illinois marijuana industry managed to add more than 12,000 jobs last year, even though a long-awaited retail expansion remained in limbo.
Cannabis employment grew 72% to 28,992 jobs, in line with sales, which rose 73% to $1.78 billion for medical and recreational products, according to Leafly, a cannabis information website, and Whitney Economics. The continued delay in issuing licenses for 185 new dispensaries, caused by lawsuits challenging the state’s licensing process, is likely to slow growth this year. There’s no telling when the licenses will be issued, and it could take six months to a year for licensees to get new stores open.
Leafly (NASDAQ: LFLY) and Whitney Economics expect overall cannabis sales to grow 58% this year.
“Lack of access and higher prices are what is holding Illinois back,” says Beau Whitney, founder of Whitney Economics.
Growth also generally begins to slow after the first few years of a new market. Illinois started recreational sales in 2020.
Illinois has just 12 stores per million residents, according to Leafly. Michigan, which legalized recreational use about the same time as Illinois, has 51 per million. Michigan had higher employment at 31,152 jobs and roughly equal cannabis sales as Illinois, even though its population is 27% lower.
“We were surprised Illinois was able to sell almost $1.8 billion last year with only about 100 licensed stores,” said Bruce Barcott, senior editor of Leafly. “It’s all about those (185) licenses becoming stores. The constriction in jobs and sales growth is real. A lot of people around the country are watching Illinois.”