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Industry Focus: Marijuana Industry
In 2015, the legal marijuana industry in Colorado created more than 18,000 new fulltime jobs and generated $2.4 billion economic activity, according to a study conducted by the economic consulting firm Marijuana Policy Group. The state commissioned the study to analyze the initial marijuana market size and demand in Colorado, as well as a review of market performance post-legalization. Other than the direct increase in demand of legalized marijuana, indirect impacts of marijuana legalization come from increased demand on local goods and services: growers rent warehouse space and purchase sophisticating lighting and irrigation equipment, for instance. Marijuana retailers similarly rely on other companies, like contractors, lawyers and book-keeping services, to conduct their own businesses. Importantly, the study estimates that the majority of growth in the legal marijuana industry is not coming from new, previously untapped demand for cannabis, but rather from siphoning off the unregulated black market. Finally, on the tax side of the ledger, the report finds that marijuana is already pulling in tax revenue at three times the rate of the alcohol industry. By 2020, the firm expects marijuana taxes to outstrip cigarette taxes as a revenue generator. Given the continued trend of marijuana legalization in the US, the marijuana industry is gaining interest as a high growth industry.