Canadian marijuana industry employment tumbled as producers drew federal COVID-19 cash, analysis shows
author profile pictureBy Matt Lamers, International Editor
January 3, 2022 -
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A breakdown of the Canadian cannabis job gains and losses
The pandemic struck the cannabis industry at a particularly sensitive time.
After spending billions to expand via mergers and acquisitions, the largest LPs collectively lost more than CA$5 billion.
The companies took steps to stem the losses, which ultimately included destroying more cannabis than they were able to sell.
In essence, the largest companies poured billions of dollars into cultivation facilities, with the financial backing of Bay Street and Wall Street, even after MJBizDaily reported in January 2018 that those businesses had already bankrolled more than enough capacity to meet demand.
The gamble apparently backfired and ended up putting the largest companies at a competitive disadvantage, as they soon became too slow to react to the fast-evolving sector.
In the ensuing months, many facilities were closed and sold for pennies on the dollar.
“There is a human toll, and I think that’s clearly been missed,” said VanderMarel, who also helped launch Good & Green in 2018 before it was acquired in 2019 by 48North, where she served as co-CEO.
VanderMarel said that a focus on stock price over customers and quality control contributed to many problems for the large producers.
She suggested that having thousands of employees made some companies look good, “even if it wasn’t really reflective of what the company was doing or what it needed.”
“But showing job growth showed corporate growth, which was the goal to maintain or raise the stock valuation in order to get more investor money.”
