Cannabis Industry Recruiting Best Practices

By Liesl Bernard

Who could have predicted back in January how much the world would change over the months to come? With all of the turmoil and challenges presented by the COVID-19 pandemic, the resiliency of the cannabis industry has been a welcome bright spot in 2020. Cannabis businesses have filled thousands of positions this year – both temporary and permanent – in a labor market where more than 30 million have filed for unemployment. According to one study, the number of people working in the U.S. cannabis industry is predicted to reach almost 300,000 by the end of the year, almost a 50% increase from 2019.

In addition to an expanding job market within the industry, across-the-board growth means compensation and median salaries are also rapidly increasing. Some positions have seen double-digit growth in average compensation compared to data from 2019. Smart cannabis businesses looking ahead to 2021 should take a strategic look at their hiring needs and develop a comprehensive plan for compensation and payroll.

As the market becomes more saturated and competitive demand increases, companies will continue to seek top talent experienced in their fields. Smaller regional groups and singular dispensaries are starting to be consolidated as multi-state operators establish greater footprints and work to attract talent with stronger compensation packages. Both executive and non-executive employees are in high demand:

• Leading companies in the industry are seeking to attract proven talent from non-cannabis businesses in the consumer packaged goods, biotech, food and beverage, financial services and pharmaceutical industries. Demand for this new talent has pushed average executive compensation up higher and higher.
• Total U.S. cannabis sales are projected to reach more than $15.5 billion by the end of 2020, which means retail sector jobs and compensation will continue to remain in high demand (jobs like budtenders, customer service, delivery drivers, security, etc.)

Recruiting Executives

The cannabis industry is still young, and effective leadership is often the difference between success and failure for a new business. Many cannabis companies fail to reach their full potential due to poor leadership, and filling executive positions with qualified candidates is vital to profitability, sustained growth, and creating a competitive edge for your business.

Some of the most important traits to look for in C-suite and VP level candidates include:

• Leadership and coaching skills: Your company leadership team should inspire others to constantly be learning, innovating and growing. Effective cannabis executives listen to, guide, and support a team of employees, giving them the tools they need to make smart decisions. Think coach, not dictator.
• Adaptability and ability to learn from failure: To survive in the cannabis industry, your business (and therefore your leaders) need to be adaptable as rules, regulations and industry standards change frequently. Innovative services and products are being introduced to the market daily, and your business needs to be able to pivot and react appropriately in order to reach the next level. Analyzing failures, making necessary adjustments and pushing forward is key to success in this industry. Flexibility is key.
• Courageous decision-making: Leaders in the cannabis industry are frequently put in positions where they need to make decisions with conviction in order to capitalize on new opportunities and be the driving force behind a company. Executives need to be confident, well-informed and in tune with the industry to make the best calls. Candidates who describe themselves as “decisive” are 12 times more likely to be high-performing CEOs.
• Optimism: Optimism is one trait that sets many top cannabis executives apart from the rest. With all of the ups and downs of the cannabis industry, staying positive in the face of ambiguity and trying times is essential when in the company driver seat.

Hiring an executive employee is all about finding the right balance of experience, company culture and industry fit, and offering a competitive compensation package that will still allow room for growth.

Recruiting Non-Executive Employees

With the uncertainties 2020 has presented, many cannabis companies have opted to expand by adding temporary staff as an affordable, on-demand solution. Prescreened temporary workers have proven to be excellent solutions for companies that are looking for workers during the pandemic, either for short or mid-term special projects, or to fill in for employees on medical leave.

As the industry continues to flourish, many employees are looking to enter the space, and many are starting in entry-level positions and working their way up. Positions like budtenders, trimmers, delivery drivers, cannabis extraction technicians, security personnel and even entry-level marketing roles are all in high demand in today’s market. Some of these positions don’t necessarily require prior cannabis experience, but provide candidates with the perfect opportunity to gain experience.

Some important attributes to look for in non-executive candidates include:

• Experience that can translate to cannabis: While some non-executive positions don’t require prior cannabis experience, you’ll want to look for candidates who at least have experience that will be relevant to this unique industry. For example, bar and restaurant or retail experience usually translates well for budtender positions. Customer service, experience in a fast-paced environment, and time management are across-the-board skills to look for.
• Teamwork: All cannabis jobs require teamwork to some extent as businesses and the industry continue to evolve. Looking for team players who exhibit cooperation and accountability are especially important for startups and new businesses just getting off the ground.
• Adaptability: Just as with executive positions, the ability to adapt and pivot at any job level is crucial to success in cannabis. Hiring managers should look for candidates who show creative problem solving skills and have examples of times they triumphed under pressure.
• Client-facing skills: Networking, communication and consumer interaction are important to establishing a brand in the marketplace and building company growth and customer loyalty. Look for employees who you feel confident can represent your team and your brand directly to the source – the cannabis consumer.

Median salaries for the most popular entry-level cannabis positions have increased steadily since 2019, and this growth isn’t expected to slow down anytime soon. Temporary positions are also in high demand as cannabis companies adjust to new regulations, deal with absences and manage spikes in sales activity.

The Bottom Line

Despite the sweeping challenges presented by 2020, the cannabis industry has remarkably not seen a significant reduction in overall hiring levels for C-suite and senior staff employees. This year has also provided new opportunities for early-career individuals to enter the market as temporary employees. As legalization continues to spread and the industry continues to expand, companies are asking for cannabis experience and higher education levels more so than before – and salaries are rising to meet this demand. Retail workers are also seeing a boost in pay as national cannabis sales are projected to hit record numbers by the end of the year, even in the midst of a pandemic.

My advice for companies recruiting employees during an extraordinary year:

• Clearly define the purpose or “why” of your cannabis business – answering this question is increasingly important to attracting top talent. Prioritize building a leadership team that aligns with your values.
• Hire people who can be flexible and are equipped to handle the ups and downs of the cannabis industry – look for employees with the ability to set-shift (consciously move from one task to another without a drop-off in performance.)
• Focus on quality instead of quantity when it comes to building your team.
• Try to build a team for longevity – invest in your team by offering competitive compensation packages, stock options and other forms of equity.

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