As more states legalize pot and brands continue to grow, the green biz keeps on bringing in the green.
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May 24, 2021 4 min read
This story originally appeared on MJBizDaily
From jobs to tax revenue to commercial real estate, the marijuana industry has a large – and growing – impact on the broader economy in the United States. The total U.S. economic impact from marijuana sales in 2021 is expected to reach $92 billion – up more than 30 percent from last year – and upwards of $160 billion in 2025, according to analysis from the newly published MJBizFactbook.
To measure the industry’s economic impact, MJBizDaily analyzed similar industries and applied a standard multiplier of 3.5 on projected recreational and medical marijuana retail sales. The numbers are a best guess because the marijuana industry’s structure is somewhat unique because it encompasses agricultural, manufacturing and retail activity.
The economic impact of the marijuana industry is not the same as supply-chain revenues that are often used to estimate the “total size” of an industry. Rather, the economic multiplier paints a picture of the impact the industry has on the broader economy. In this case, for every $1 consumers and patients spend at retail locations, an additional $2.50 will be injected into the economy, much of it at the local level.
That impact comes directly from the day-to-day needs of workers in the cannabis industry, including spending on life’s necessities such as housing, transportation, entertainment and more. Marijuana businesses, consumers and patients also pay hundreds of millions of dollars in state and local taxes that are used to fund state and local government activities,