This article by Beau Whitney was originally published on NCIA, and appears here with permission.
Supply tightness in the labor market represents a significant risk to cannabis operators heading into the summer months. With the potential of wage inflation adding to the costs of businesses, many operators that are struggling to make ends meet due to the economic stresses associated with 280E now face higher labor costs. This labor tightness and higher costs could not have come at the worst time.
The recent U.S. Bureau and Labor Statistics jobs report for May, published on Friday, June 4, 2021, indicated that there were 559,000 jobs added to the U.S. economy. This amount was lower than what analysts had predicted but still strong nonetheless.
The report also showed that the labor force participation rates held steady which is a good sign that people are not getting too frustrated with their job search. The BLS data also indicated that there are still 9.3 million workers unemployed. Even with these higher numbers of displaced workers, this level is roughly 3.6 million workers higher than it was pre-pandemic when unemployment was at record lows. Considering that 1.1 million workers are on temporary layoff status, a remaining 2.5 million delta is a significant improvement relative to the 18.0 million workers displaced in April of 2020.
While there are differing opinions on policy on how to support the unemployed, the key point here is that the labor force is significantly …