Editors Note: This week Leafly publishes Cannabis Jobs Count a special series on jobs in the legal cannabis economy. The series begins today with Rob Reutemans report on cannabis employment data and why its so hard to find. We continue tomorrow with a state-by-state count of cannabis jobs. In this Oct. 1 2015 photo employees of Amazon Organics a cannabis dispensary in Eugene Ore. help customers on the states first day of adult-use retail sales. (AP Photo/Ryan Kang) Cannabisculture has moved in a few short years from an illicit black market to a legal industry in 29 states and the District of Columbia. Earlier this year the data analysis firm New Frontierpronounced recreational cannabis the fastest-growing industry sector in the United States outpacing electric vehicles LED bulbs solar installations and big data. Legal cannabis sales reached nearly $7 billion in 2016 up from more than $5 billion last year. Many expect sales in excess of $20 billion by 2020 even without federal legalization. But like any young industry theres much we dont know. For instance we have no solid government data on the number of people employed in the legal cannabis sector. We know these people and their jobs exist. We see them growing cannabis producing oils and edibles selling at retail shops. But beyond anecdotal evidence and despite the emergence of several data analytics firms devoted to the industry we have little information on their wages benefits and working conditions. There are no reliable figures for the number of people employed nationally in the legal marijuana industry says Morgan Fox communications manager for the Washington D.C.-based Marijuana Policy Project. Hes right. Last year Marijuana Business Daily(MJ Biz) estimated that somewhere between 21000 and 33000 U.S. companies get some or all of their revenue from legal cannabis. That includes growers retailers infused-product manufacturers and testing labs of course but it also takes into account consultants technology providers security firms hydroponics and other businesses. For those ancillary jobs MJ Bizuses a common multiplier effect that assumes each of the 7000 to 11000 companies directly involved with the cannabis plant will generate revenue for at least three other companies. Last year a group ofOregon economists estimatedthat each dispensary there employed at least six people but its hard and likely inaccurate to extrapolate those numbers to other sectors of the industry. And its difficult to even have much confidence in that six-per-dispensary figure. Some of the biggest product manufacturers and retail shops in Seattle and Denveremploy upwards of 100 people each. The big industry-wide sales estimates are impressive. But the human factor remains elusive. Thats partly because legal cannabis is a young emerging industry and partly because cannabis remains federally illegal. Federal prohibition continues to hamstring the industrys ability to collect and analyze data about its workers. Federal agencies you see are the authorities who traditionally collect and tabulate jobs data. The feds dictate to the states how they want that collection doneor as is the case with cannabis not done. The U.S. Department of Labors data agency the Bureau of Labor Statistics doesnt just refuse to acknowledge the existence of legal cannabis jobsit doesnt even have the capacity to tabulate them if the agency wanted to do so. Business and employment data are collected using the North American Industry Classification System (NAICS) which assigns a code number to each occupation. Breakfast cereal manufacturing for example is 311230. No specific NAICS code exists for any part of the cannabis industryand its not likely to come into existence anytime soon. NAICS codes are updated only once every five years by a consortium of US Mexican and Canadian government agencies. The next update is due in 2017. There is no cannabis code on the agenda. Even if cannabis were legalized by the federal government tomorrow it would be years before labor statistics bureaus could break those jobs into a separate category. In a pinch theyd probably be lumped into 424210 Botanical drugs and herbs merchant wholesalers as suggested in this online cannabis banking thread. Going after state numbers Farmworkers inside a drying barn take down newly harvested plants after a drying period at Los Suenos Farms Americas largest legal open air cannabis farm in Avondale Colo. During the fall 2016 harvest the 36-acre farm at Los Suenos yielded 5 to 6 tons of cannabis. (AP Photo/Brennan Linsley) So we have no official national data. What about state numbers? Consider Colorado poster child for the new cannabis economy. Because most of the industry remains federally illegal there is disagreement across the federal government as to how we collect employment data in the marijuana sector says Alexandra Hall chief economist for the Colorado Department of Labor and Employment. Until we get the feds on board were going to have some challenges tracking employees. That being the case Hall said we work around it to some degree. Hall has made a few attempts to match up the states employer databases with its employee tax databases. But she admits we have run into some problems with that methodology. Ours is an incomplete estimate. She took a run at it early last year and came up with a figure of 6000 payroll employees. Because the numbers are changing at a faster rate than the overall economy were probably not capturing all of it. It might be a third larger maybe 8000 workers but were not talking about tens of thousands of jobs were not capturing. Others disagree. They put the direct payroll figure in the 10000 to 13000 range. Andrew Freedman director of marijuana coordination for the state of Colorado also admitted the difficulty of coming up with an employment number for the legal cannabis industry. There are about 20000 occupational licenses currently issued but its really hard to say how many of those folks have jobs he said earlier last year. A lot of them are not great jobs and the people often are pretty transitional so Id use a working figure of somewhere north of 10000. Colorado has an indirect occupational tally that other legal states dont. All employees of state-licensed cannabis companies must maintain a license from the Colorado Department of Revenues Marijuana Enforcement Division (MED). Theyre like food industry worker cards. The occupational licenses are good for two years and allow the holder to work in the marijuana industry. The number of active MED cards fluctuates but in 2016 the number was usually hovered between 27000 and 30000. Thats a pretty solid data point. An official with the Department of Revenue added this caveat however: We do not track how many of these licensed individuals will go on to work in the industry. Taylor West deputy director for the National Cannabis Industry Association says shes heard employment estimates of 30000 in Colorado alone based on occupational licenses and ancillary jobs. But even that is very rough not based on a lot of hard numbers. Mike Elliott formerly executive director of the Denver-based Marijuana Industry Group also uses the number of MED license holders to come up with a figure of about 25000 employees. From the number of license holders (27350) take off 10 percent for people who may no longer be employed in the industry or who let their license expire Elliott says. Thats just people who touch marijuana who grow sell or manufacture it. He adds Im an attorney and very much part of the industry but I have no occupational license. Huntingthe Colorado number Farmworkers process newly harvested cannabis plants at Colorados Los Suenos Farms. (AP Photo/Brennan Linsley) Frustration with the lack of a solid jobs figure led Adam Orens and a group of colleagues at the Marijuana Policy Group a Denver-based economic consulting firm to take a run at the data themselves. They thought the number of MED employment licenses was a good starting point toobut a license itself didnt necessarily equate to a full time job. By comparing the number of licenses with their own ground-truthed estimate of direct full-time employment they estimated one full-time equivalent job (FTE) for every 2.14 MED licenses. In their final analysis published last October the Marijuana Policy Group (MPG) estimated that there were 12591 full-time jobs directly supported by the cannabis industry in Colorado in 2015. Using models that calculate additional indirect and induced employment the MPG report found that $996 million in annual cannabis sales supported a total of 18005 full time jobs in 2015. What about 2016? Year-over-year if you just look at one state you can probably scale it up accordingly Orens says. There are a few nuances youd missthere was more outdoor cultivation in 2016 which requires relatively fewer workersbut overall youd have a solid estimate. Colorados total cannabis sales in 2016 topped $1 billion at the end of October. They were on pace to hit $1.33 billion by the end of December. That 33 percent increase applied to employment would push the states full time cannabis jobs to 23407. The Big Kahuna: California Aaron Gonzalez follows a path to harvest cannabis from grower Laura Costas farm near Garberville Calif. in October 2016. (AP Photo/Rich Pedroncelli) What about the Golden State? Again nobody knows for sure. Experts agree on only two things about Californias cannabis market. Its the largest in the country and there is virtually no government or institution-backed job data available. Whatever data we lack in Colorado says Joe Hodas chief marketing officer for Denver-based Dixie Elixirs its a hundredfold in California. Chris Walsh editorial director of Marijuana Business Daily estimates that California represents 40 to 50 percent of all legal sales nationally. California is a big black hole of data he says and its half the industry. John Kagia is executive vice president of industry analytics for Washington D.C.-based New Frontier a data company focused exclusively on legal marijuana industry. New Frontier has formed a partnership with ArcView the cannabis-focused angel investor network to produce annual reports and updates on the industry. We have not built a comprehensive view of the national legal cannabis job market says Kagia. However we have seen some state-specific analysis for markets like Colorado and Oregon. In Colorado the estimates suggest over 10000 people are employed in the industry. In Oregon arecent report found that 2100 retail jobs had been created but it did not project numbers for the overall industry.Since each state classifies the industry jobs differently it will take some us some time to build a definitive national picture on the legal industrys employment level he adds. Its a very difficult number to capture. Bringing light to job data darkness In this Oct. 27 2016 photo Rachael Torricelli looks at marijuana for sale at Blum in Las Vegas. (AP Photo/John Locher) Marijuana Business Daily which has been tracking the industry since 2011 included rough national employment numbers for the first time in its 2016 Marijuana Business Factbook. Its very difficult to get numbers in this industry says MJ BizsWalsh. The state estimates tend to be way off. Some are laughable. In some cases people with great credentials are just making shit up. MJ Bizdoes an anonymous online survey of cannabis business owners. One question that was asked of nearly 1000 respondents was how many people they employ full and part-time. We can get an average for each niche Walsh says. Given the darkness of the industry this is the best way to look at it. The results? MJ Bizprovides both a conservative and an aggressive estimate. For jobs in which an employee touches the plant the estimate ranges from 55000 to 88000. Total industry employment is projected to be from 101000 to 154000. For the industry total Walsh uses an economic multiplier that projects two ancillary jobs for each direct job. We also include people from other industries that may have one employee who deals with the pot industry he says. We strive to provide realistic numbers grounded in reality not to make the industry appear bigger than it really is Walsh adds. We dont lobby offer investments provide consulting services or have any other reason to publish hype. We present a conservative picture of the market. At this point with the federal Bureau of Labor Statistics refusing to acknowledge the existence of a single legal cannabis job a conservative estimate may be the best were going to get. Lead Image: Brennan Linsley Coming tomorrow: Leafly dives into state-by-state data to determine how many full time jobs are supported by the legal cannabis industry. On Friday Rob Reuteman profiles five real people in five real cannabis jobs. In our final installment we look at current employment openings in the cannabis industrycomplete with salaries benefits and some surprising job titles. Rob Reuteman Rob Reuteman is a former columnist and business editor at the Rocky Mountain News. He now teaches journalism at Colorado State University. The post The Federal Government Claims Zero Cannabis Jobs Exist. Heres Why. appeared first on Leafly. by Rob Reuteman at Leafly