Colorado's Marijuana Industry Is an Economic Powerhouse
The first state to legalize marijuana for both medical and recreational use is enjoying a boom in tax revenues and employment.
More than 18,000 people in Colorado now have full-time jobs because of the legalized marijuana industry, which has generated a $2.39 billion impact on the Rocky Mountain State’s economy.
Those are two of the findings in a new report that attempts to quantify the impact of the marijuana industry in Colorado, one of the first states to legalize cannabis for both medical and recreational use.
The “Economic Impact of Marijuana Legalization in Colorado” report, created by the Marijuana Policy Group in Denver, uses a new model for measuring the economic importance of marijuana called the “marijuana impact model.”
The group claims it is the first to fairly calculate how legalized marijuana has impacted Colorado’s economy. Among areas considered for the first time are secondary marijuana industries such as warehousing, cash-management, security, testing, legal services and the engineering needed to cultivate marijuana indoors.
A new economic engine.
The study found that the marijuana industry, which is still growing, already outstrips the economic output of most industries in Colorado. Among the report’s findings from all of 2015:
- All marijuana industry-related activities generated $2.39 billion in state economic output.
- The marijuana industry created 18,005 new full-time jobs in Colorado.
- Because it is confined within the state, the Colorado marijuana industry already creates more economic output and employment per dollar spent than 90 percent of all Rocky Mountain State industries.
- The marijuana industry generated $121 million in combined sales and excise tax revenues, which is three times more than those generated by alcohol sales and 14 percent more than casino revenue.
The future of marijuana industry in Colorado.
As the one of the first states to legalize marijuana for recreational use (along with Alaska, Colorado has led the way in regulating legalized marijuana sales. It also has provided an example of the impact legalized marijuana can have on an economy. The report estimates that the marijuana industry will grow by 11.3 percent each year through 2020.
“This growth is driven by a demand shift away from the black market and by cannabis-specific visitor demand,” the report states.
Total sales are expected to peak at about $1.52 billion annually in Colorado. So many “cannabis tourists” are visiting Colorado that the total amount of marijuana needed for them is projected to increase from 14 metric tons to 55 metric tons by 2020.
The huge growth has been driven through Colorado’s early movement into legalized marijuana, making it a magnet for businesses working in marijuana sales, manufacturing and testing and earning it the nickname “Silicon Valley of Cannabis.”