Though the U.S. government’s temporary lifeline to tens of millions of unemployed workers expired, sales of recreational marijuana products have proved resilient.
The $600-a-week unemployment benefit ended July 31, and Congress failed to pass an extension before leaving for its August vacation.
But in the two weeks since the benefits ended, sales of recreational marijuana in key markets remained stable, even posting a visible increase during the first week, according to data provided by Seattle-based Headset.
It’s difficult to assess why that would happen, according to Liz Connors, director of analytics for Headset, but “it is still very early after the expiration.”
“Consumer spending doesn’t often drastically shift overnight but, rather, gradually changes over a few months,” she said.
The case might also be made that cannabis is an “inferior” good – a product that experiences sales increases during negative economic cycles. Alcohol sales often follow this pattern.
With fewer outside-the-home entertainment options available, consumers might shift discretionary spending to activities that can be done at home, including ingesting marijuana.
Speaker of the House Nancy Pelosi called back the U.S. House of Representatives to address other issues, but some legislators are pushing to vote on a coronavirus relief package, which includes additional unemployment benefits.
Markets might also see a shift toward medical marijuana purchases, which are not subject to the same taxes as recreational, according to analysis from New York-based cannabis consultants Greenwave Advisors.
States that allow adult-use sales often see a slowing of MMJ purchases as consumers opt for the ease of not having to register with the state to obtain a medical card for purchases.
However, as household incomes shrink, that ease of access might not be enough to offset the additional cost.
Sales of medical marijuana in Colorado, for example, have increased more rapidly than adult-use sales since the beginning of 2020.
Jenel Stelton-Holtmeier can be reached at [email protected]