As recreational use of marijuana arrives across the region, jobs in weed are growing

As New Jersey legalizes recreational use of marijuana and Pennsylvania looks in that direction, businesses such as Zen Leaf cannabis stores expect to expand with hundreds of well-paying jobs.

“Adult use opens the cannabis market to new consumers, a new base,” said Brian Ward, chief financial officer for Verano Holdings, the Chicago-based parent company of Zen Leaf. “We’re continually hiring at this point. … In terms of the region and the economic impact, I can tell you that it’s absolutely massive.”

The industry nationwide already employs 321,000 workers after expanding 32% during the pandemic, according to Leafly’s 2021 Jobs Report. A lot more jobs are coming. Verano, which operates in 11 states, already has two cultivation facilities and 14 medical dispensaries across New Jersey and Pennsylvania — totaling more than 500 jobs — and plans for seven more stores in the Keystone State that would add a couple hundred more positions, he said. On top of that, Ward said, all sorts of ancillary businesses — real estate, transportation, accounting — benefit from the marijuana market. “The opportunities,” he added, “can really be endless.”

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Around the country and region, many are betting on the “green rush” to rev their economic engines, especially post-COVID, and that has pushed states to legalize marijuana not only for medicinal but also recreational, or adult, use.

In the last year alone, eight states, including New Jersey and New York, have legalized recreational marijuana for those 21 years and older, taking the total to 19 states plus D.C., according to the nonprofit Marijuana Policy Project (MPP). Several more, including Pennsylvania and Delaware, are crafting bills.

At the same time, some caution that cannabis is not a cure-all for state budgets, and the complex, highly regulated industry poses its share of challenges, not the least of which is that marijuana is still considered illegal at the federal level.

“Every state is its own experiment right now,” said Brad Sodowick, a clinical assistant professor of finance at the LeBow College of Business at Drexel University who co-teaches a class on the emerging cannabis industry.

Marijuana is one of the fastest-growing industries in the country, hitting $18.3 billion in legal sales last year, a 71% increase (thanks to the stress of COVID) over 2019, according to cannabis website Leafly. Wages start at about $15 an hour for a cultivation trimmer or retail budtender, rising to as much as $175,000 or more for a vice president of sales, according to the Vangst Cannabis Industry Salary Guide.

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“You’ve got these living-wage jobs,” said Beau Whitney, founder and chief economist of Whitney Economics in Portland, Ore., who collaborated on Leafly’s jobs report.

In general, he added, legalizing recreational marijuana increases sales by as much as tenfold over medical sales. That means more jobs, of course, and state dollars — though legal cannabis is still a small slice, generating from half a percent to 1% of a state’s revenue, Whitney said. Earlier this year, Illinois grabbed headlines when it took in more tax dollars from cannabis than alcohol for the first time.

Some studies also show that cannabis can reduce prescription-drug use and might decrease mortality from opioids, he said. Taken together, that makes for a promising industry, Whitney allowed, even as he pointed out that “legal is not a panacea. It’s not going to solve all problems.”

Still, cannabis is hard to resist.

When Delaware State Rep. Ed Osienski (D., Newark) entered office in 2010, recovering from the Great Recession was the priority. “I campaigned on creating good jobs,” he said. “I look at this [legalizing adult use] as really fulfilling my promise to my constituents.”

Despite his enthusiasm, Osienski could not muster the three-fifths majority needed to pass the bill last session. He said he plans to try again. “I’m going to keep plugging away at it,” Osienski said.

Next door in Pennsylvania, State Rep. Jake Wheatley (D., Allegheny) has cheered legalizing marijuana for several years, not only for economic reasons, but also social equity ones.

Last month, he and State Rep. Dan Frankel (D., Allegheny) sought cosponsors for their proposed legislation that would build on the state’s medical marijuana infrastructure to create a legal and regulatory framework for cultivation and retail sale of marijuana and related products.

It also adopts best practices to advance social and economic equity in communities — often those of color — that have been negatively impacted by cannabis criminalization. And to that end, calls for expunging records, providing opportunities to work in the industry and reinvesting in hard-hit neighborhoods.

“Originally, I was not for legalization of adult use,” Wheatley said. What changed? He said he saw firsthand the impact of criminalization on friends and Black and brown communities.

Despite some push-back from faith leaders, Wheatley has persisted, propelled in part by the fortunes of states that legalized marijuana early on, such as California, Colorado, and Washington.

“What I saw from those states was economic opportunity,” Wheatley said. “I really thought it was time for Pennsylvania to get into the conversation.”

California leads the country’s legal cannabis market, with nearly 58,000 jobs, and last year, it had $3.77 billion in sales, according to Leafly.

Even though Pennsylvania has only medical marijuana sales, it’s going gangbusters, coming in 10th on the website’s list of top states. It boasts 15,895 workers — more than 7,000 added just last year despite the economic fallout of the pandemic — and sales that reached $810 million. The state also was cited for maintaining “one of the nation’s largest pools of medical cannabis consumers.” As of May 18, it topped 343,600 patients, according to MPP.

“Our infrastructure with medical marijuana is unmatched in the region,” said Meredith Buettner, executive director of the nonprofit trade group Pennsylvania Cannabis Coalition, based in Harrisburg. The state has nearly 130 operating dispensaries, she added, and a potential for a whopping 210, once all permits have been issued.

“Our medical market is more robust than any of our neighbors’,” Buettner said. In comparison, New Jersey lists 20 alternative treatment centers on its state website, though more are in the offing.

» READ MORE: Failure by Pa. officials to clarify rules around medical marijuana, addiction treatment had serious consequences

Typically, medical marijuana operations expand into the adult-use market. That makes Pennsylvania primed for a quicker transition — perhaps within six months of legalization — compared with other states, while still having enough product for patients. New Jersey is expected to have a 12- to 18-month timeline. “I think there is a little bit of a misconception,” Buettner said, that Pennsylvania is “so far behind neighboring states.”

Despite the rosy industry picture, cannabis can be a difficult business, and companies have seen their fortunes rise and fall.

“We make a lot of revenue compared to other retailers,” said Jeremy Unruh, senior vice president of public and regulatory affairs of the Chicago-based, privately held PharmaCann, which operates in Pennsylvania and other states. “But everything costs so much more … that the margin evaporates.”

For example, the real estate possibilities for stores are often limited, raising prices. Marijuana’s controlled-substance status at the federal level makes commercial loans hard, if not impossible, to get, and an IRS rule forbids deduction of business expenses.

U.S. Sens. Cory Booker of New Jersey, Chuck Schumer of New York, and Ron Wyden of Oregon, all Democrats, are cosponsoring a bill that would treat marijuana much like alcohol or tobacco, allowing it to be taxed and regulated., although the legislation is not seen as having much chance of passage. The U.S. House voted to decriminalize marijuana last year.

“The only way to stay in business,” Unruh said, “is to get bigger and more robust.”

To that end, the vertically integrated, large-scale operators are already investing in Pennsylvania, betting legalization of adult use is on its way, sooner than later. Verano snapped up TerraVida Holistic Centers, a chain of medical marijuana stores based in Jenkintown, in February for about $135 million. Meanwhile, in April, Trulieve Cannabis Corp. became the latest out-of-state marijuana company to invest here, with the $60 million purchase of Keystone Shops.

And several universities are jumping in to train the next generation of workers. The University of the Sciences in Philadelphia has launched an MBA degree for students seeking opportunities in cannabis. Stockton University in New Jersey offers a minor in cannabis studies, while Thomas Jefferson University in Philadelphia offers a graduate certificate in cannabis medicine for health professionals.

Currently, PharmaCann employs about 200 people in the state at its four Verilife stores, Unruh said. With adult use, Unruh expects the market to balloon. “For us, that translates to probably a three times increase in the number of jobs we will be providing,” he said. “There are jobs and opportunities and growth in this industry.”

The Future of Work is produced with support from the William Penn Foundation and the Lenfest Institute for Journalism. Editorial content is created independently of the project’s donors.