Canadian Pot Companies Face Talent Shortage

Friday, July 26th 2019
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Canadian Pot Companies Face Talent Shortage

Canada’s coming legalization of extracts and edibles is putting a new strain on a cannabis jobs market where it’s already difficult to find skilled workers.

Extracted cannabis oil is necessary to produce vape pens and edibles. But with products set to become available as soon as December, cannabis companies are struggling to find skilled extractors. In turn, the extractors want to hire experienced expert technicians, analysts, and testers. But companies are struggling to fill those positions.

"The challenge that I'm seeing in the industry right now is there's a very small pool of candidates who would have already worked in cannabis extraction roles," said Cannabis at Work CEO Alison McMahon. "Especially if we're talking about highly educated, masters degree or PhD level people."

Though McMahon noted there's a whole pool of people who've done unlicensed extraction work, most companies want to hire workers with professional-level training.

"The challenge there is finding people who have the right transferable skill sets from these other industries and fit with the overall culture of the cannabis industry."

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The shortage of expert skills across the sector is widely acknowledged—and the issue isn't just in extraction. Every technical corner of the Canadian cannabis industry is desperate to draw experienced talent from a talent pool that's barely begun to fill.

The root of the problem is simple enough. Before 2014, virtually no one in Canada or the U. S. was licensed to commercially cultivate medical cannabis. But even after a few dozen licensed producers emerged on the scene, the legal medical cannabis industry employed a tiny fraction of the Canadian workforce. Producers often had to learn as they went, with no one who could legally teach them. There were few cultivators who knew how to grow quality MED at commercial scale. If you needed an expert, you needed to become one.

Of course, North America had plenty of cannabis experts. Unlicensed growers, working in concert with MED users, activists, and compassion clubs helped developed all kinds of products and experimented with production and extraction approaches to best meet the needs of the medical-cannabis market.

By the time grey-market dispensaries had proven they could operate openly in cities from St. John's to Victoria, plenty of Canadians were becoming experts on cannabis cultivation, production, and genetics. They were learning the best ways to produce extracts, and the best approaches to produce edibles to meet a variety of medical needs. Some of these experts might even be able to get hired by a licensed company—as long as they don't have a record for cannabis cultivation, which would prevent them from getting mandatory security clearance. But that's not where challenges end.

"The challenge for individuals who have worked in the black market and gained their experience there is it can be a challenge in cultural fit into the highly regulated environment,” of the legal industry, McMahon said.

Though many unlicensed producers proudly grow organically and eschew substances they believe harmful to cannabis consumers, they do so without the burden of regulation. In the strictly controlled environment of a licensed producer, workers spend their days filling out paperwork and making sure there are no documentation gaps, while updating enterprise-resource planning (ERP) and seed-to-sale systems.

"While it's obviously growing cannabis at its core," McMahon said, "the operational requirements and the regulatory requirements around that are not always the best fit for individuals whose true passion is really to grow plants, and who in the past haven't necessarily had to deal with the burden of all the regulatory and compliance side."

Regulatory compliance is not optional for new hires, said Lifford Cannabis CEO Lisa Campbell.

"Most new hires need to start from scratch, including [learning] a huge list of cannabis acronyms," she said. "I'm not looking to babysit my employees. They need to be already knowledgeable—not just about cannabis, but also the regulations, both federally and province-by-province. It’s really sink or swim in the cannabis industry, so it requires the highest caliber of employee."

But Campbell believes there are many legacy-market experts who could thrive in the legal production side.

"Nothing beats actually knowing about cannabis," she said. "That being said, there are very few professional certifications to show someone is a qualified cannabis worker. There are many myths about cannabis, so it’s important to find someone who has expert knowledge with the skills to match. Some people are very knowledgeable about cannabis, but the industry is in start up mode which requires a work ethic well beyond most nine-to-five jobs."

Cannabis Management Resources partner Sarah Seale agreed, noting what she called "the extreme demands" of the cannabis industry. "Sometimes the right person is in place but the stress levels are so high it leads to a six-to-eight month burnout period," Seale said.

For Seale, the question of hiring gets complicated by the perspectives different workplaces bring to the task.

"Each company has their own definition of what 'top-tier talent' means, and unfortunately the viewpoint can be quite narrow," she said. The average company hopes to find an experienced executive who'll need only a short time to get up to speed and begin working magic right out of the gate. Many companies have learned quickly, Seale said, that "considering the nature and duration of the cannabis industry specifically, it's hard to find experience and in-depth knowledge of cannabis itself."

Passion matters enormously. Dan Sutton, CEO of BC-based LP Tantalus Labs, has heard complaints of staffing shortages for some time, but says he has experienced little of it first hand. Companies that frame their brand around enthusiasm for cannabis, Sutton said, don't have to look far to find employees as passionate as they are.

"I think it's feasible to find humans who nerd out on process and systems and security and the different functions of the cannabis business without being quite as committed to the plant," Sutton said. "However, it certainly makes for a more interesting working environment when you can all get together on your lunch break and talk about interesting new genetics or talk about some funny phenomenon that you noticed in one of the production runs."

For bigger companies that aren't focused on deep cannabis nerdery, Sutton said—suggesting infrastructure and tech-oriented firms, and those chiefly producing bulk cannabinoids—hiring is a different challenge.

"You're trying to get people to self-select for a different personality type, maybe just a growth of business or their own personal financial gain," Sutton said, adding the risk is without passion, drive alone can carry a worker very quickly to burnout.

McMahon says similar talent shortages first emerged following Canada’s legalization of MED at the turn of the millennium and became rampant only a few years ago, as the need for experienced growers outweighed the available licensed-producer workforce.

"All of a sudden people needed cultivation talent," McMahon recalled, "and there's only a limited number of people who worked in the 30 some licensed producers at that time doing that. I think this is just the new version of that challenge as the regulations are evolving. Time will help solve that and create a bigger talent pool."

"As the financial market starts to desire more cost-efficiency and perhaps management consultants come in and create efficiencies on those larger teams," Sutton said, "then perhaps we'll see new entrants into the labor market from those firms, and I think we'll see a lot broader access to the expertise [of those currently employed]."

But until then, Lifford’s Campbell thinks the next shift needs to be one that helps bring the talent of legacy experience into the licensed market.

"There are enough people in the cannabis industry who know nothing about cannabis. It’s time for the existing industry to cross over. or else legal cannabis will never beat out the illicit market."

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