States that legalize cannabis tend to record stronger agricultural employment growth than they otherwise would have experienced, according to new research from economists at Texas Tech University.
The study, presented at the 2026 Agricultural and Applied Economics Association conference, found that agricultural employment rose by roughly 9% following cannabis legalization. However, the increase in jobs was not accompanied by a comparable rise in pay. Researchers said the wage pattern likely reflects broader labor-market dynamics rather than a direct consequence of marijuana policy.
For the analysis, researchers examined state-level information collected by the U.S. Bureau of Labor Statistics through its Quarterly Census of Employment and Wages. The dataset covered the period from 1990 through 2024.
They used the synthetic difference-in-differences method to estimate how legalization affected agricultural employment and other economic measures. The researchers compared states that adopted cannabis legalization with a modeled group representing how those states might have performed without the policy.
The researchers said the gap between rising employment and unchanged wages may indicate that farms and related businesses were able to meet additional labor demand by attracting more workers rather than offering substantially higher pay. In other words, the agricultural labor pool may have been sufficiently flexible to absorb the increase in demand.
The findings also suggest that the effects of legalization were not identical across all jurisdictions. Researchers urged policymakers to account for when legalization occurs and the conditions of local labor markets when assessing the potential economic consequences of similar policies.
The cannabis industry has become an increasingly significant source of employment in the United States. A 2026 Vangst and Whitney Economics report estimated that the legal marijuana sector supported approximately 412,500 direct jobs nationwide.
Meanwhile, a previous study found that medical cannabis legalization was associated with fewer instances of workers missing work, with the relationship particularly notable in industries such as agriculture and manufacturing, where workers may face physically demanding conditions.
Research released last year on workers’ compensation also reported a gradual rise in claims following legalization, while the average cost of individual claims declined. The study additionally found reduced use of prescription medications, including opioid painkillers.
Earlier research from the National Bureau of Economic Research found that recreational marijuana legalization was associated with higher workforce productivity and fewer workplace injuries among older workers. It also reported reductions in both the likelihood of receiving employees’ compensation benefits and the amount paid to those who did.
Industry firms, such as Tilray Brands Inc. (NASDAQ: TLRY) (TSX: TLRY), will be pleased that research is confirming the beneficial effect of marijuana legalization on employment opportunities in the jurisdictions where reforms are enacted and implemented.
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