With every young booming industry there is always an economic bonus that comes along with it. The cannabis industry is just that and more. Not only will this continue to be a beneficial market for the economy, but it’s an added bonus to society too.
What started as something that was taboo to be associated with, is now common in many households across North America thanks to the recreational and medicinal aspects of the substance. We’re going to reveal how much the industry has changed in the past 50 years and all the exciting things coming to the industry that will benefit society.
It took time for the taboo surrounding cannabis to subside
Cannabis has been around for a long time — there’s no argument about that. Dating back as far as 2727 B.C, cannabis was widely used for it’s natural and physical capabilities — the cannabis seeds were used as animal feed, and the oil from the plant was used for things such as paint. The chemical components of the plant are also notorious for their euphoric and soothing powers that are now commonly used in medical practices as a natural alternative to pharmaceutical prescriptions.
The varying degrees that cannabis can be used truly makes it a complex and diverse industry to study and be apart of. It was only a matter of time before everyone started warming up to the idea of using it, not to ‘get high’, but as a personal and individualized regime that is becoming a lifestyle for many.
According to Gallup, over 65% of Americans were supportive for cannabis to be federally legalized, which is a huge change from when the poll was first taken in 1969 when only 12% supported. It was in 2000, that support for legal cannabis had finally hit a majority. Maybe the new millennium opened everyone’s minds and eyes.
Now that cannabis is trending and there are more innovative ways to consume it, such as oils, creams, drinks, chocolate, vapes, and the list could go on. Those who were opposed to smoking the substance are now opening up to how they can incorporate cannabis and all of the beneficial factors into their lifestyle. Medicinal cannabis is legalized in 33 states as of 2014, and with the great success seen from the medicinal category, the recreational category is soon to follow suit with federal legalization on the cusp.
According to Statista, in 2016, legal marijuana in the U.S generated approximately 6.56 billion dollars in sales and are projected to grow at a compound annual growth rate (CAGR) of 14% over the next six years, reaching nearly 30 billion dollars by 2025! With ⅔ adults in the U.S already supportive towards legalizing cannabis nationwide, the remainder will come around with time. I mean, 38.4 million U.S. adults say that they use cannabis at least once per year. In this, 59% say they use cannabis at least once a week, and 36% say they use cannabis daily. Up from being a societal faux-pas, it’s now becoming just as common to use cannabis as it is to have a beer at the end of your day.
Baby boomers are getting into the swing of it
Take a look at the graph below. The generation that was previously deemed as conservative and hesitant to change are becoming the largest segment of consumers. Today there are 10 times as many seniors using cannabis than the same age group in 2012. Additionally, within the past 10 years the acceptance rate for seniors rose by almost 10%; from 50% to 59%.
With this, seniors are mindful about where they get their cannabis from. StatCan outlined that approximately half use for medical reasons, 24% for recreational use and 24% in favour of using it for both. The increase in popularity for this age groups is largely due to the increase of the average age of cannabis users, which has risen from being 29 years-old in 2004 to 38 years-old in 2019.
The legalization of recreational cannabis has also spiked the demand from both medicinal and recreational users. As recreational cannabis comes at a lower price point, is more accessible, and comes in just as many strains and potencies as medicinal varieties, medicinal users are opting to use recreational marijuana instead.
Federal legalization is bound to come soon
Young adults, aged 18 to 34, make up 45% of cannabis users, and have been supportive of legalization for some time now. Hitting a remarkable 78% approval rate, this group is the largest. The second most supportive group are those aged 35 to 54, at a 65% approval rate, but not too far off of the seniors who landed near the 60% mark.
These numbers are high considering it’s not federally legalized yet. With infrastructure and regulation changes continuing to push legalization forward, we can expect to see approval ratings rise, realistic regulation changes, more rounded public education offerings, and ultimately, more comfort at all ends of the spectrum.
Legal cannabis gives back
By 2025, recreational cannabis is set up to be one of the fastest growing segments ever, and with traction like this, we can expect to see job opportunities spike.
According to Cannabiz Media, legal marijuana businesses now hold approximately 9,397 licenses in the U.S, and they lie in the hands of cultivators, manufacturers, dispensaries, couriers and labs. A Glassdoor analysis identified a 76% growth rate of job openings on their platform in the cannabis space over the past year. Right now, the cannabis industry in the U.S directly employs 211,000 full-time workers. If we include indirect jobs, that pushes the job count to 300,000. Just last year more than 64,000 jobs were created, which is a 44% increase from the year prior. We’re also expecting 20,000 additional jobs to be added within the next year from Florida and California alone.
The spike in job creation was aligned with the increase of medicinal patients, which grew from 65,000 to 165,000 over a single year — an incredible sign of demand within the market and so much industry potential is still to come to light with federal legalization.
Peace of mind is the key behind legal sales
As cannabis is being decriminalized and legalization slowly rolls out, we can see a decrease in illicit market sales. Although the illicit market still exists, and may never be totally out of the picture, the decrease in illicit sales is important for the sake of the communities safety and peace of mind when it comes to consumption. Not everyone trusts the source or potency that they’re getting from their dealer anymore; with the uprising of safety concerns hitting the news tied to illicit market cannabis and cannabis products, we just can’t be sure of where it’s coming from anymore and people are going out of their way to make sure that the cannabis they purchase is not only legal, but regulated to ensure their or their families safety.
Peaking political interest is integral
The initial idea behind legalization was to take money out of the hands of criminals and put it back into the economy, and it’s doing just that. Government earnings through taxation are further viewed as an opportunity for countries to earn high revenues and have the flow of cash to put back into the community. As an example, the tax revenue collected in the state of California amounted to a whopping 345.2 million USD in 2018. With that kind of cash, funding cannabis educational programs and future-proof infrastructure is self-sufficient.
Meanwhile, we also see that the CBD market is striking attention all over the country for health benefits without the disorienting ‘high’. With this, the December 2018 Farm bill that was passed outlined the legalization of hemp, a market with potential to reach 20 billion dollars by 2022.
With the radical reassessment of cannabis and it’s hard-earned place in society, the importance for legalization is finally hitting the political landscape with fire behind it. Federal and legislative roadblocks still keep some states from legalization, and even states where it is legal, there is some much needed fine-tuning. However, cannabis advocates in communities are pushing their political leaders to strike real change. Now we see nearly every presidential candidate confirming their support for some kind of federal policy reform, and it’s pretty likely that we’ll see a substantial policy debate to come along during the 2020 election cycle.
With the vast majority of American voters in support of the legalization of recreational cannabis, big federal decisions should be on their way.
What we can expect in the future
With significant growth in the job sector, political support, and the monetary value boosting the economy, cannabis is proving that it’s an industry worth keeping an eye on. Going forward, there are 3 key trends that will push the industry forward.
The first is legitimization. With the heightened awareness of new regulatory regimes, compliance is going to be what makes or breaks businesses coming into the space. The second is professionalism. With supportive investors, businesses starting up in the cannabis industry are seeking professional and technical workers who can manage scaling their business with the demand of the market The last, and maybe the most important trend pushing the industry forward is modernization. Living in the digital age, making your business accessible to the tech-forward society we live in is crucial. Online ecommerce, reviews, and delivery services are coming into the industry and are integral for the longevity of a brand.
Now is the time to reap the benefits of investing in the cannabis space while it’s early and developing for the scale it’s bound to grow into.
If an online ordering or home delivery regulatory model exists in your state, or for our Canadian retailers, province, contact us and we can get your legal recreational dispensary set up for success on the Verda Platform. Add online ordering and same-day home delivery to your dispensary and future-proof your business while giving your customers the convenience of shopping from the comfort of their own home.
Did you see the last blog? If not, click here to discover the 5 hottest trends coming to cannabis retail here.