New Jersey Cannabis: Year in Review 2023

By: Robert Mejia, adjunct professor of Cannabis Studies, ������Ƶ

When a new industry is poised to nearly double its revenue in one year, it is notable. That’s where the New Jersey cannabis industry is. Data from 2022 (and early 2023) shows that New Jersey cannabis businesses generated $555 million in sales last year. This year, those businesses - and a slate of newly licensed cultivators, processors, edibles manufacturers, and dispensary owners - are on pace to sell $1 billion in cannabis.

In addition to robust sales growth, here are some additional useful comparisons and statistics that reveal the status of our fledgling New Jersey cannabis industry. The number of adult-use dispensaries has risen from 20 to 63 in a single year. Meanwhile, medical-use dispensaries had modest growth from 10 to 11 facilities, respectively.

Cannabis employment in New Jersey (according to a Vangst jobs report) experienced impressive one-year growth, growing from 3,147 to 7,367 full-time positions. Keep in mind that ancillary or support jobs for the cannabis industry will outpace these numbers. That is, over 50% of all jobs “in cannabis” are support or ancillary positions, such as website design, copy writers, marketers, security consultants and more.

Another exciting development is the NJCRC’s acceptance of license applications for these three new business classes:

• Distributor - a business that transports bulk cannabis and cannabis products.
• Wholesaler - a business that stores, buys and/or sells bulk cannabis and cannabis products.
• Delivery - getting cannabis and cannabis products from a store to individual buyers.

Licenses for these categories opened on Sept. 27, 2023, for Social Equity Businesses, opened on Dec. 27, 2023, for Diversely Owned Businesses (either women-owned, minority-owned or disable-veteran-owned), and finally, on March 27, 2024, all other businesses could apply. This staggered schedule was designed to give social-equity and diversely-owned businesses a head start in the licensing process.

In 2023, a much-more-expansive edibles and infused beverage market was announced. Some class 2 manufacturers have already applied for a waiver and have started producing caramels and chocolates. Once a public comment period has ended, all class 2 licensees will be able to produce edibles and infused beverages as diverse as baked goods, savory snacks, infused oils and butters, jams, and low THC (5 milligrams per serving or less) infused beverages. Previously, only soft and hard lozenges, syrups, drink drops, pills, tablets, and capsules were allowed.

The NJEDA (New Jersey Economic Development Authority) offered two rounds of ground-breaking cannabis grants. First, they awarded a “Joint Ventures Grant” in the amount of $250,000 to 48 recipients. Originally, only 24 awardees were to be named. Awardees had to have a conditional or annual license, control of real estate and a letter of resolution from a township. Forty percent of the grant winners were social-equity applicants.

In a news release from April 12, the NJEDA explained, “The goal of the Joint Ventures Grant is to support businesses that do not need technical assistance but still have carrying costs and capital issues associated with converting their conditional license to an annual license.”

Then, the second grant - funded at $150,000 per grant - called The Phase II Seed Equity Grant is solely for social-equity applicants (with a 5% Impact Zone set aside). Applicants must have obtained a conditional license but may not have secured the real estate or municipal approval needed. Additionally, all applicants who secure this grant will be eligible for eight weeks of technical/training assistance. The application portal for this series of grants opened on November 30, 2023.

While the New Jersey cannabis market is growing at a fast pace, issues such as municipalities opting out of the cannabis business, difficulty in securing capital, and running a business that is technically federally illegal and overregulated continues to stunt the full potential of the industry.

We will soon see if we fare better in 2024.