Pot and the Workplace: Will There be Costs?

About a year ago, I was engaged in a panel discussion before an audience of economic developers. Another consultant took umbrage with me for suggesting that the legalization of recreational marijuana may, and I repeat may, erode workforce productivity.

He said I was “opinionated” for even suggesting the possibility, which I thought was a bit curious. He went on to say (correctly) that alcohol is the most abused drug in our society, costing billions of dollars in lost time, workplace accidents and so on.

His argument followed that if society accepts alcohol, surely it should accept the recreational use for marijuana, a far less dangerous drug.

Another common ancillary argument to this train of thought is that if that people continue to put themselves into an early grave by smoking cigarettes, drinking sodas, and eating artery-clogging junk food, then adding marijuana to the mix will not cause any measurable harm.

But try as I might, I have yet to get high by asking for a supersized meal at a drive-through window. Maybe I’m just not going to the right places.

A Bridge too Far

Perhaps I should say from the outset that I do favor the medical use of marijuana, as the therapeutic effects of cannabis related to reducing chronic pain, nausea and vomiting due to chemotherapy are now widely accepted in the medical community.

I also favor decriminalization of marijuana. I do not believe that a criminal record should result for possession. I would go so far as to support the expungement of criminal convictions for marijuana-related offenses.

But note that decriminalization is a far cry from legalization, with storefronts and commercial products, and even cannabis tourism. Despite being a live-and-let-live kind of guy, legalization still remains a bridge too far for me, and I will explain why.

Cocksure

What strikes me most about the debate on the legalization of marijuana for recreational use – notice that I did not say medical use – is that many people are so cocksure that this is a benign drug.

In the wake of Canada becoming the second country in the world to make the recreational use marijuana legal, I recently posted a question on LinkedIn: “I wonder how legalization will affect the country's competitive position in the world. Will it affect (workforce) productivity?”

That prompted a rather curious response from, of all people, a workforce development executive, who said that in conferring with law enforcement and human resources that “weed is not the issue.”

Crash Rates Up

If weed is not the issue, then I would suggest that the data shows that it should be. The Insurance Institute for Highway Safety's Highway Loss Data Institute released two studies on Oct. 18 indicating that crashes in states with legalized recreational marijuana have increased.

The first study found that crashes are up as much as 6 percent in Washington, Oregon and Colorado, compared with neighboring states that haven't legalized recreational use of marijuana.

The second study looked at the number of police-reported accidents before and after the legalization of recreational use of weed. It found a 5.2 percent increase in crash rates after legalization than before marijuana was legal in those states.

"The bottom line is that there appears to be a negative impact of highway safety in legalized states, and states considering legalization need to be prepared to deal with this impact," David Harkey, president of IIHS-HLDI, told Automotive News.

 "Regardless of the substance -- whether it's alcohol, marijuana, prescription drugs or other substances -- it is still illegal to drive impaired, and we need to make sure that the public understands that we can't be behind the wheel, period."

NTSB Recommendations

Just two days earlier, on Oct. 16, the National Transportation Safety Board called on the National Highway Traffic Safety Administration to write standards for devices allowing police to test drivers for drugs on the roadside and to give states additional guidance on how to combat drug-impaired driving.

The recommendations came out of the NTSB’s investigation of the 2017 crash in rural Texas that killed 13. The accident was caused by a pickup truck driver who was high on marijuana and an anti-anxiety medication and slammed head-on into a church bus, NTSB found.

There are no standardized tests for marijuana-impaired drivers. The Standardized Field Sobriety Tests used to determine if someone is driving drunk are only moderately successful in determining that someone is impaired from marijuana, studies have shown.

What we do know, what the Centers for Disease and Prevention says, is that marijuana can slow reaction time and the ability to make decisions. Its use impairs coordination, distorts perception, and leads to memory loss and difficulty in problem-solving.

Finally, the risk of impaired driving associated with marijuana in combination with alcohol appears to be greater than that for either by itself.

In the Workplace

While more research is needed, studies have found associations between marijuana use in the workforce and work absenteeism, reduced productivity, job turnover, disciplinary measures, workplace accidents and injuries, unemployment and interpersonal conflict.

One such report by the National Institute on Drug Abuse found that workers who tested positive for marijuana on a pre-employment urine drug test had 55 percent more industrial accidents, 85 percent more injuries, and 75 percent greater absenteeism compared with those who tested negative for marijuana use.

The Canadian Public Health Association endorses Lower Risk Cannabis Use guidelines that suggest users wait six hours or even longer before driving or operating machinery.

More recently, the Occupational and Environmental Medicine Association of Canada released a position statement on cannabis use in safety-sensitive work, recommending a wait time of at least 24 hours before engaging in safety-sensitive work.

A Growing Industry

Nine U.S. states and Washington, D.C., have legalized recreational use of marijuana, and 30 states have approved it for medical use. Democratic Sen. Ron Wyden of Oregon said it's time for the U.S. government to follow Canada's lead.

"Now that our neighbor to the north is opening its legal cannabis market, the longer we delay, the longer we miss out on potentially significant economic opportunities for Oregon and other states across the country," he said in a statement.

Sen. Wyden is correct in thinking that pot is a big business. Research firm Euromonitor has estimated that the U.S. market for legal marijuana products will reach $20 billion by 2020.

According to the Arcview Market Research, the U.S. legal cannabis market is expected to reach $11 billion in consumer spending in 2018, expanding further to $23 billion by 2022. Research firm Cowen projected that the market size of U.S. legal cannabis industry will reach $75 billion in by 2030, surpassing the carbonated soft drink market in 2017.

Watch This Case

Meanwhile, a federal trial in Denver that begins on Monday (Oct. 29, 2018) could have far-reaching effects on the budding (pun intended) U.S. marijuana industry.

Hope and Michael Reilly claim in their lawsuit that "pungent, foul odors" from a neighboring indoor marijuana grow have hurt the property's value and their ability to use and enjoy it. The trial is the first time a jury will consider a lawsuit using federal anti-racketeering law to target cannabis companies. 

Congress created the Racketeer Influenced and Corrupt Organizations Act — better known as RICO — to target organized crime in the 1970s. The law allows private parties to file lawsuits claiming their business or property has been damaged by a criminal enterprise. Those who prove it can be financially compensated for damages times three, plus attorneys' expenses.

The case goes to trial in federal court, because marijuana is illegal under federal law.

A Topical, Complex Issue

As many of you know, I write this blog for a business and economic development audience, although anyone outside those two camps are welcome to give it a go. The fact that I offer personal observations and opinions is really quite secondary.

My primary purpose is not for you to agree with me, but to get you to think about issues relevant to business and economic development. Certainly, marijuana and the workplace is a one of those topical (and complex) issues.

What makes it particularly problematic is that fact that unlike alcohol or many drugs, marijuana stays in a person’s system for weeks or months. A person could use marijuana in their home where it’s legal and be fired for testing positive on a drug test when they’re back at work days or weeks later.

Tim Feemster, my friend and colleague at BBA, understandably takes a hard line when it comes to testing for marijuana.

“I know this seems harsh but while alcohol is legal, we do not allow people to work on the manufacturing floor, in the distribution center, or drive a truck while they are drunk. But since we do not have a ‘level of impairment’ test for pot, any level of positive test means termination.”

What If? What then?

Employers in safety-sensitive industries, like construction, manufacturing and trucking, are more likely to have a zero-tolerance policy when it comes to marijuana use. In an already tight job market, legalization will only make it more difficult for them to find workers that are “clean”. Some are abandoning drug testing altogether as a practical measure.

The mantra today in Corporate America is that people are a company’s greatest asset. And, indeed, research seems to show that happy, engaged, healthy employees contribute to the bottom line of a business.

Assuming this to be true, I have to wonder if legalization of marijuana is necessarily the right answer. If more studies continue to show a correlation between marijuana use and work absenteeism, reduced productivity, job turnover, workplace accidents and injuries, and the like, what then? What will we do?

I'll see you down the road.

Dean Barber is the principal of Barber Business Advisors. BBA helps communities become better places for business and companies find better places for doing business. If you found this blog useful, feel free to forward it to a friend and subscribe to BBA Digest.