Cannabis Job Growth in Illinois Wilts, Falls Nationally

Industry employment across the country fell 2% last year.

This story was republished with permission from Crain’s Chicago and written by John Pletz

Job growth in the Illinois marijuana industry slowed dramatically last year after the initial surge that followed legalization of recreational cannabis sales.

Employment in Illinois climbed 4% to just under 30,000, compared to a 72% jump in 2021, according to the Vangst Cannabis Jobs Report, based on data from Vangst, an employment platform, and cannabis-research firm Whitney Economics. The picture was worse nationally, however. Industry employment fell 2% last year, which was the first decrease in a decade.

The jobs picture reflects the broader change in fortunes for the industry, where oversupply has caused a decline in prices even as inflation kept driving up costs. Lack of federal legislation that might have eased banking or tax restrictions added to the industry’s woes.

Marijuana sales increased just 3% in 2022, according to Whitney Economics. Sharp declines in pot prices, and a surge in consumption during the pandemic, hurt industry growth last year. In 2021, legal cannabis sales increased 33%, triggering a 32% increase in hiring.

Because of tight restrictions on new licenses for growers and sellers, Illinois has been spared from some of the steepest declines in marijuana prices. But it has been hurt by a slower-than-expected rollout of new retail licenses. The state issued 192 dispensary licenses last year, but only a small number of stores have opened.

“Illinois employment grew, despite there being softness in the market overall and a change in consumer behavior in the marketplace,” said Beau Whitney, founder of Whitney Economics. “Consumer-basket (sales per transaction) amounts are down as consumers began reducing spending on cannabis due to inflationary pressures. Basket amounts remained unaffected by inflation until September of 2022, when there was a quick pivot in consumer-spending patterns.”

Illinois has the nation’s third-largest concentration of cannabis jobs, trailing Michigan, which has 35,405 jobs. Michigan overtook Colorado, which has seen some of the industry’s worst price compression.

Also on the rise is Missouri, which began recreational-marijuana sales in February. Missouri grew jobs the fastest last year of any state, more than tripling its weed employment to 9,733, according to the Vangst report. California, which has by far the largest legal cannabis industry, posted the biggest decline, sliding 13% to 83,593 jobs.

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