When Canada legalized recreational cannabis, it did far more than give Canadian adults the freedom to enjoy a puff without fear of the law. With legalization, the cannabis industry is now able to actively contribute to the Canadian economy — and that impact is becoming evident on both a local and national scale. For investors, this means that putting their money behind local cannabis companies does much more than fund their operations.
Cannabis legalization led to economic growth—who knew?
Investors were among the first to understand the potential in legalizing recreational cannabis. In fact, the ‘green rush’ of cannabis investment began almost as soon as Prime Minister Justin Trudeau announced that Canada would be legalizing the market in 2015. The introduction of a brand new legal industry, with an existing and passionate consumer base and years of experience in refining their palate, created a wave of new businesses—and with it came opportunities for investors to get involved early. That window is still well open, as new businesses launch alongside the upcoming legalization of major product categories like edibles and concentrates. The legal Canadian industry is in its early stages, and there’s plenty of opportunity for investors to capitalize on cannabis companies and benefit all involved.
The extent to which Canadians and their economies stand to benefit from the industry is directly proportional to its growth—and there’s a lot of economic development happening. The Canadian cannabis market is expected to expand from $569 million in 2018 to nearly $5.2 billion by 2024. Meanwhile, Canadian governments brought in $186 million in tax revenue in just the first five and a half months of legalization. This means that investors funding the evolution of the industry are helping to spur government revenue that ultimately goes into social programs and community development.
Jobs, jobs, and more jobs
Every cannabis business that pops up in Canada means another selection of jobs that could not have existed without legalization. According to an August 2018 Statistics Canada report, there are now 9,200 people employed in the Canadian cannabis sector, up from just 1,438 employed by the medical-only cannabis industry in 2017.
These jobs range from budtenders in retail stores, to workers beginning careers in grow houses and extraction labs, or marketers and administrators coming in from other industries. Statistics Canada figures don’t include ancillary services from outside the industry like construction workers building grow facilities or web designers working on cannabis websites. For socially-conscious investors, investing in budding cannabis retailers or producers is an opportunity to contribute to the job landscape of the community they operate in.
Canopy Growth’s massive cannabis growing facility in Smiths Falls has become a potent symbol of how the industry can help revitalize communities. The facility once belonged to The Hershey Company, one of the town’s largest employers in its day—employing 750 people or, more significantly, over 8% of the town’s population. Not surprisingly, the chocolate factory’s closure in 2008 came as a major blow to the town. In 2016 however, Canopy converted the plant into 168,000 square feet of growspace. The company plans to have at least 1,000 people employed at the facility by the end of 2019, prompting what the town’s mayor called an unprecedented economic revival in Smiths Falls. And this story is not unique. Cannabis companies across the country are revitalizing economies, making them an attractive prospect for investors that want to support Canadian growth.
Not your average university degree
Cannabis jobs require skilled workers, providing Canadian post-secondary education institutions with a new avenue for growth. Colleges and universities across the country have wasted no time building programs to train the next class of cannabis workers. This in itself has created even more job demand for cannabis industry veterans who can pass on their skills. Some schools are even partnering directly with cannabis companies to give students hands-on industry experience. Investors that want to partake in the grassroots development of the industry can look to cannabis companies that are working with higher education institutions to upskill the cannabis workforce or fund strategic research for the industry.
A year into its legalized recreational market, Canada is rapidly solidifying its role as the global leader in the industry. And if we take a step back and look inwards, the country and its communities are benefitting extensively from the growth of the sector. For investors still eyeing the cannabis market from the sidelines, this contribution to the Canadian economy might be just the incentive they need to get involved.
Want to be a part of the growing Canadian cannabis industry? Eden Empire is an opportunity to do just that.
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