Last December, Michigan kicked off the Midwest's first legal adult-use retail market, racking up over $3 million in sales in the first two weeks alone. The demand for legal weed has stayed high — to the point of pot shops having issues keeping their shelves stocked — and the state budget office predicts that the legal market might eventually top $2 billion in annual sales.
Yet, despite this impressive growth, nearly 7,000 people working in the Wolverine State’s weed industry actually lost their jobs last year. The reason for this is a result of the state's transition from a highly-unregulated medical marijuana market to a tightly-controlled one. The state's original medical marijuana law, passed in 2008, imposed relatively few regulations on businesses. The state completely overhauled these rules in 2016, however, including stricter regulations and new tax rules.
As recently as two years ago, there were around 15,000 people working in hundreds of dispensaries all across Michigan, according to a recent industry report by Leafly. Regulators gave these dispensaries over a year to apply for new business licenses that would comply with the state's updated regulations, but many business owners chose not to (or could not afford to) apply for a new license.
In 2018, the state sent cease-and-desist letters to hundreds of dispensaries across Michigan that failed to complete the new application process. Most of these businesses were eventually forced to close, and an estimated 7,000 legal weed industry workers found themselves out of a job.
“We now estimate the legal industry supports a little more than 8,200 full-time-equivalent jobs,” said Leafly Senior Editor Bruce Barcott to MLive. "That’s a huge loss — but consider that we’re still waiting to see legal, licensed cannabis stores open in Detroit, the state’s largest city.”
Last month, the Detroit City Council voted to delay legal weed sales through March 31, in order to give the city time to create a social equity program encouraging marginalized communities to get involved in the regulated weed business. Another 14,000 Michigan municipalities have also banned all legal weed sales, although some plan to follow Detroit's lead and allow sales to begin later this year.
As of January 1, the state Marijuana Regulatory Agency (MRA) had only granted 50 adult-use licenses and 377 medical licenses under its new regulatory system. By this week, that number grew to 76 adult-use and 436 medical licenses, and new applications are still rolling in. The total number of legal retail locations has increased by 40 percent — from 26 to 43 — between December 31 and February 5, and these stores have moved $18 million worth of weed since sales began.
As more legal retailers open their doors, a growing number of weed industry employees who were forced out of work last year will be able to apply for new positions. In fact, insiders now believe that the Wolverine State's adult-use industry will be able to recover all of the jobs lost in 2019 within the next two years.