Denver Restaurants In Trouble Due To Pot Industry

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Alpha8472
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Denver Restaurants In Trouble Due To Pot Industry

Post by Alpha8472 »

Bloomberg is reporting that Denver restaurants have seen a downside to the legalized pot industry. Many restaurants are losing workers to the pot industry. Why work in stressful and hot kitchen when you can work in a climate controlled greenhouse for $22 an hour? Restaurants are having difficulty finding workers to staff their restaurants.

If a restaurant makes a 10 percent profit margin, they are doing a good job. In the pot industry profits of only 20 percent would be terrible. The pot industry sees a huge profit margin and tourists have been flocking to Denver for the legalized pot. There is also the tech boom which has increased the number of young people patronizing the pot industry in Denver. New construction is also in high demand due to the tech boom. More housing is needed, but there is a lack of construction workers. However, the construction companies are having difficulty finding workers as many people have migrated to the pot industry for the higher wages.
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by rwsandiego »

When I first read the title of your post I thought "Hmm...seems counterintuitive given the propensity of pot to cause the 'munchies'." That said, I can see how other industries could suffer from a labor shortage.
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by BillyGr »

rwsandiego wrote:When I first read the title of your post I thought "Hmm...seems counterintuitive given the propensity of pot to cause the 'munchies'." That said, I can see how other industries could suffer from a labor shortage.
And that could be a double problem - less workers and at the same time more demand in the restaurants from those using the drug.
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by Brian Lutz »

No word on how Taco Bell and Denny's are doing lately.
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by storewanderer »

I find this similar to how certain low population areas that were in oil booms in the Dakotas or in Alaska could not get labor to run retail stores, gas stations, fast food, etc. because the oil jobs all paid so much more...

Same goes for mining in areas where population is low and mining booms, you cannot get people to work in these retail or restaurant jobs because they can make so much more money working mining. This seems like the same sort of thing...
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by Super S »

Haven't heard of anything like this in Washington or Oregon where it is also legal...
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Re: Denver Restaurants In Trouble Due To Pot Industry

Post by Alpha8472 »

Oregon and Washington don't seem to be as affected as the legal pot industry only started recently. Oregon is dominated by low paying pot industry wages. The workers only make about $21,000 per year on average. Denver started pot sales in 2012, and this has led to outrageously high pot industry wages in that area. Legal pot is more expensive in Denver and the prices are out of control.

Restaurants are seeing decreases in alcohol sales. People who are buzzed from pot don't seem to be buying alcohol as much. In addition, chefs are being lured away from restaurants to make pot edibles in Denver for much higher wages.

It remains to be seen if prices for legal pot sky rocket out of control in California, Oregon, and Washington. Or perhaps law makers would pass laws to regulate pot prices to save the restaurant industry. That probably won't happen as pot is highly taxed and the tax money from pot sales is much higher than tax revenue from restaurants. The pot industry employs 100,000 to 150,000 people in the US. That could triple in the next few years. Most likely the pot industry will lure away low skilled restaurant workers to the pot industry causing an even greater shortage of workers.
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