The cannabis industry is continuing its rapid expansion. Nationally, the industry has seen a 690% growth in employment between January 1st, 2017 and August 1st, 2018. The projected growth for 2019 is another 220%. This trend shows no signs of slowing down which puts cannabis companies at the forefront of an economic development that demands the utmost attention. As employment opportunities continue to rise with an expanding market, an industry specific competition for experienced employees will ensue. Cannabis business owners must be aware of this and act accordingly if they wish to attract and retain high-level employees. Failure to do so could lead to increased employee turnover and a workforce comprised of inexperienced and under-qualified talent.
Wages
Fundamental economics dictate that as demand for cannabis employees increases, so too will their wages. To be exact, the industry has seen an average wage increase of 16.8% since January 2017. As a business owner, it is vital that you understand the current market value of your workforce. Failure to pay adequate wages to key employees will likely cause them to seek employment elsewhere. With demand for cannabis employees increasing, determining your most valuable employees (or identifying a positional void) should be a top priority. Below are examples of highly compensated positions that will be in high demand as the industry continues to mature:
· Director of Cultivation – Average Salary $88,000
- This employee may be responsible for multiple cultivation programs, strategies, and future innovations. They may need to be familiar with multiple growing facilities in multiple locations.
· Compliance Manager – Average Salary $62,500
- Your compliance manager is one of the most important employees on your staff. They are tasked with staying up to date on local, state, and government regulations pertinent to your operations.
· Dispensary Manager – Average Salary $56,250
- The dispensary manager coordinates store transactions and operations. They may also liaise with law enforcement as well as state officials. They will also implement your company policies and practices with the entire staff.
· Trimmer – Average Wage $12.25 / Hour
- Trimmers are no longer seasonal or part-time employees. They are an essential component to the cannabis industry. Many industry experts suggest that human trimming is essential to creating the proper visual appeal that will move product consistently.
Regardless of the nature of your business operations, key employees will be needed to ensure that your company grows along with the market. Whether you currently employ qualified individuals, or are seeking to attract the right candidates, offering competitive wages is vital to properly staffing your business.
Benefits – Origins
After World War 2, the U.S. Government was very concerned with the dangers of inflation. The world saw what happened when hyper-inflation gripped Germany and gave rise to the regime of Hitler. To combat the issue, the Stabilization Act was passed in 1942. Essentially, this limited wage increases that employers could offer an expanding workforce. With no other way to attract desirable talent, employers turned to employee benefits to lure the best and the brightest to work for them. This was the beginning of employer-sponsored healthcare in the United States.
In many ways, the modern cannabis industry is microcosm of the post-war economy. A rapidly expanding industry is competing for qualified talent. While there are no governmental wage restrictions in place, company margins will only support wages that allow them to remain profitable. As such, employee benefits can once again be an attractive compensatory item when paired with a competitive wage. Also, the passing of the Affordable Care Act now mandates that employers with over 50 employees provide benefits. Failure to implement compliant, attractive, yet cost-effective benefits can be the difference between continued growth and stagnation.
Benefits – Under 50 Employees
Employers will often conclude that because they are not subject to the employee mandate, it is not necessary for them to assume the responsibility and costs associated with providing employee benefits. Additionally, as many of their employees tend to be younger and lower wage, they do not feel the benefits will be utilized. However, as previously stated, the cannabis industry is growing more competitive and employers need to be aware of their benefit options as it will be crucial to attract and retain talent. Misconceptions aside, there are many cost-effective solutions available to employers with under 50 employees. Offering these solutions to your employees before you are “mandated” to do so will go a long way in differentiating your company from the competition. Learn More.
Benefits – Over 50 Employees
Another common misconception among many cannabis companies is that their options are limited when it comes to providing benefits to their employees. Based on their region, there may be an increasingly limited number of insurance carriers available and the coverage hardly justifies the expense. Moreover, many cannabis industry professionals operate locations in multiple states. They may have retail stores in CA, WA, and CO which presents significant challenges when it comes to providing benefits to their employees. Simply stated, these challenges only exist if employers limit themselves to traditional major medical insurance companies. There are a multitude of ACA compliant plans available to employers that will allow them to unify employees across state lines, reduce costs, and even recapture underutilized claims dollars at the end of the plan year. By significantly reducing the costs associated with employee benefits without sacrificing coverage, employers can experience unprecedented growth and capitalize on the expanding market. Learn More.
Creative Approach
A growing trend among America’s best performing companies is to heavily invest in the training and development of their employees. From formal education, to industry specific training, investing in your employees can pay significant dividends in the long run. Companies that provide employee training and development have reported a 65% reduction in turnover. As the cannabis industry continues to become more competitive, business owners should consider implementing creative strategies focused on advancing the careers of their employees. Many experienced cannabis employees will have financial and personal concerns that will need to be addressed. Student loans, families, and health issues may all be top priorities for key employees. Consider open dialogue with your staff to ensure they are aware of your willingness to invest in their future.
Continued Growth
The rapid growth occurring in the cannabis industry shows little sign of slowing any time soon. To the contrary, the recent mid-term elections showed an expansion of both medical (33 states) and recreational (10 states) legalization. With the recent expansion of legalization, there are now over 200 million Americans that live in states that have legalized cannabis in some form. Suffice it to say, the cannabis market is growing and will continue to do so for many years to come. As the industry expands, cannabis business owners must remain focused on proper business practices and profitability. There will be additional competition from Big Business soon and they will be eager to attract the industry’s best available talent.
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