Marijuana industry will add $123.6 billion to US economy this year

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The total U.S. economic impact of regulated marijuana sales could top $123.6 billion in 2025, about 9% more than last year, according to a newly released MJBiz Factbook update.

While the overall industry continues to struggle – especially in some Western states – expanding markets such as New York and Ohio will add stability going into 2025.

With more new cannabis markets on the horizon, the industry will add upward of $200 billion in additional spending to the U.S. economy by 2030.

Direct medical and recreational marijuana sales are estimated to reach $35.3 billion in 2025 with an additional $88.3 billion added to the broader economy.

Marijuana sales growth despite lack of regulatory help

Hopes for a breakthrough moment in 2024 never came for the cannabis industry as Congress failed to pass meaningful reform and the U.S. Drug Enforcement Administration fumbled reclassifying marijuana as a legitimate medicine.

Voters also largely rejected adult-use legalization – including in Florida, where operators spent nearly $150 million in a losing effort – giving credence to the idea that easy and available reform efforts are a thing of the past.

And that explosive growth moment is unlikely in 2025.

Anxiety over price increases from tariffs imposed by the Trump administration are already impacting marijuana consumer confidence.

And with the administration’s focus elsewhere, such as on cutting or streamlining government operations, and marijuana rescheduling on hold, it is doubtful any meaningful regulatory change for the cannabis industry will happen in 2025.

That said, recreational marijuana is available in 24 states, with markets such as Minnesota opening soon.

Eastern markets such as New York and Ohio have yet to reach their full potential, and declining sales in California and Colorado somewhat stabilized last year.

The only thing that could destabilize the cannabis industry in 2025 is a broader economic recession, which seems more likely now than it did at this time in 2024.

The economic impact of cannabis

Marijuana businesses span a diverse spectrum, including agricultural, manufacturing and retail operations, as well as ancillary companies that don’t handle the plant directly – such as lighting suppliers and accounting firms.

Some markets also feature cannabis-related events and hospitality ventures, which often have an even greater economic impact than other sectors.

The cannabis industry significantly influences the broader economy, both locally and nationally.

This impact stems in part from the everyday needs of cannabis industry workers, who contribute to the economy through spending on essentials such as housing, transportation, entertainment and more.

Taxes generated by cannabis businesses and consumers also play a key role.

Each year, marijuana companies, patients and consumers contribute hundreds of millions of dollars in state and local taxes that help fund essential government services, including education and infrastructure.

The real estate sector benefits, too, as new cannabis retail, manufacturing and agricultural businesses move into communities or as existing companies expand – boosting overall demand for commercial properties.

The methodology behind marijuana sales estimates

MJBizDaily assessed the cannabis industry’s economic impact by comparing it to similar sectors and using a standard economic multiplier on forecasted recreational and medical marijuana sales.

This multiplier reveals how the marijuana industry influences the wider economy.

For every dollar spent at adult-use shops and medical marijuana dispensaries, an additional $2.50 circulates through the economy, much of it benefiting local communities.

These projections are informed estimates, considering the marijuana industry’s rapid growth, varied state regulations and its continued illegality at the federal level.

The MJBiz Factbook’s first quarterly update for 2025 is now available by subscription.

Produced by the MJBizDaily editorial staff since 2011, the MJBiz Factbook is the cannabis industry’s leading resource for year-round market data and intelligence.

In 2024, the Factbook moved to a subscription model to allow for year-round updates.

At 156 pages, the 2025 first-quarter report provides detailed analysis of national trends in licensing, stock valuations and M&A activity.

It also includes the annual state-by-state guide for medical and recreational marijuana markets in the United States.

Andrew Long can be reached at andrew.long@mjbizdaily.com.

Sponsored cannabis industry news from MJbizdaily.com

Marijuana industry will add $123.6 billion to US economy this year