While business around the world shuttered as COVID-19 spread, the marijuana industry was deemed “essential” in nearly 30 states and stood to gain from the pandemic.
But more than two years later, amid rising inflation and fears of a recession, North American cannabis companies are cutting hundreds of jobs, closing retail outlets and cultivation facilities or shuttering altogether.
The marijuana industry mirrors mainstream companies that saw similar demand and now are struggling to right-size their businesses.
Sales of Peloton bikes spiked when gyms closed and people sought fitness alternatives; but the New York-based company has axed more than 4,000 jobs so far this year.
The pandemic-era e-commerce boom that boosted Shopify’s business also appears to have cooled, and the Canadian company, which makes the technology that powers online stores, has laid off about 1,000 workers.
The cannabis industry layoffs and retrenchment have affected plant-touching companies large and small as well as tech businesses such as Akerna of Colorado, Dutchie of Oregon and delivery operator Eaze of California.
The factors behind the cannabis retrenchment are numerous. They include falling wholesale marijuana prices, cash-strapped consumers and structural changes affecting the industry, experts said.
Among the more notable plant-touching companies that have been caught up in the fallout in recent months:
- California-based cannabis advertising giant Weedmaps cut 10% of its roughly 600-member workforce, citing market contractions in California, Colorado and Oklahoma.
- Arizona medical marijuana grower Nature AZ Medicine laid off around 100 employees as medical sales drop and recreational sales spike.
- Michigan-based Lume Cannabis closed four of its roughly 30 stores in the state but did say it plans to open three additional stores in more populated areas. The realignment, disclosed in July, comes at a time when marijuana prices in Michigan have tumbled because of market saturation.
To Read The Rest Of This Article By Margaret Jackson on MJBizDaily
Published: September 06, 2022
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