Business
Marijuana companies lay off hundreds, retrench amid economic woes
While business around the world shuttered as COVID-19 spread, the marijuana industry was deemed “essential” in nearly 30 states and stood to gain from the pandemic.
But more than two years later, amid rising inflation and fears of a recession, North American cannabis companies are cutting hundreds of jobs, closing retail outlets and cultivation facilities or shuttering altogether.
The marijuana industry mirrors mainstream companies that saw similar demand and now are struggling to right-size their businesses.
Sales of Peloton bikes spiked when gyms closed and people sought fitness alternatives; but the New York-based company has axed more than 4,000 jobs so far this year.
The pandemic-era e-commerce boom that boosted Shopify’s business also appears to have cooled, and the Canadian company, which makes the technology that powers online stores, has laid off about 1,000 workers.
The cannabis industry layoffs and retrenchment have affected plant-touching companies large and small as well as tech businesses such as Akerna of Colorado, Dutchie of Oregon and delivery operator Eaze of California.
The factors behind the cannabis retrenchment are numerous. They include falling wholesale marijuana prices, cash-strapped consumers and structural changes affecting the industry, experts said.
Among the more notable plant-touching companies that have been caught up in the fallout in recent months:
- California-based cannabis advertising giant Weedmaps cut 10% of its roughly 600-member workforce, citing market contractions in California, Colorado and Oklahoma.
- Arizona medical marijuana grower Nature AZ Medicine laid off around 100 employees as medical sales drop and recreational sales spike.
- Michigan-based Lume Cannabis closed four of its roughly 30 stores in the state but did say it plans to open three additional stores in more populated areas. The realignment, disclosed in July, comes at a time when marijuana prices in Michigan have tumbled because of market saturation.
Corporate turnarounds
In addition to inflation and economic woes, cannabis businesses are grappling with staffing issues.
For one, many public marijuana companies are undergoing turnarounds, which often translate into the shedding of employees.
“The guys who come in to handle turnarounds don’t understand the market and cannabis,” said Avis Bulbulyan, CEO of Siva Enterprises, a California-based marijuana consulting firm.
Edmonton, Alberta-based Aurora Cannabis said in June that it was cutting 12% of its workforce as part of a corporate restructuring.
The company expects the move will save up to 90 million Canadian dollars ($69 million) and put it on the path to profitability. The company’s goal is to turn its first profit next year.
Another Canadian public company, Canopy Growth Corp., disclosed in August it cut 245 employees – or about 8% of its workforce – as part of sweeping changes across the company designed to help stem recent losses and nudge the struggling producer to profitability.
Canopy said it expected the cuts and adjustments to generate up to CA$150 million in savings in 12-18 months.
Canopy also closed its cultivation facilities on 23 acres in Niagara-on-the-Lake, Ontario, last year.
Echoes of the dairy industry
“The legal cannabis business is volatile,” said Daniel Sumner, professor of agricultural and resource economics at the University of California, Davis and co-author of “Can Legal Weed Win? The Blunt Realities of Cannabis Economics.”
“It’s a new industry,” he said, “and companies are coming and going and being acquired in all parts of the industry – not just growing and processing and selling.”
Consolidation in the marijuana industry is similar to what happened to Wisconsin’s dairy industry, which lost 10% of its farms in 2019 and 44% over the past 10 years.
“Production went way up, but the number of farms went way down,” Sumner said. “It’s consolidation. A lot of that consolidation means if you’re a manager, you call it labor-saving efficiencies.
“But if you’re a worker, you lost your job.”
Despite the cost of other products rising because of inflation, the price of marijuana has declined, another factor impacting companies’ ability to retain employees.
In Colorado, for example, the wholesale price per pound of marijuana was $709 as of July 1 – an all-time low – and down 46% from $1,309 a year ago and nearly 60% from $1,721 in January 2021, according to Colorado Department of Revenue data.
“Farm-level cannabis costs coming down is the reality of this business,” Sumner said. “It’s partly improved management; some is technology.”
But, Sumner said, like other agricultural crops, price declines in the marijuana industry should be expected.
“Adjusting for inflation, we now spend 10% of our income on food – not 4% like we did two generations ago – and there’s no reason to think cannabis won’t follow that trajectory.”
Structural changes
And just as practices shifted from a customer-focused approach at grocery and liquor stores where someone would tell you about the products, practices at cannabis retail stores also are likely to see changes that result in the need for fewer employees.
“Everybody used to buy their beef or their fish from the person who really knew beef and fish – you walked in and talked to the baker, the butcher or the fish monger about what you want,” Sumner said.
“That’s the way it’s handled in cannabis now. But cannabis is moving away from it. It will be cheaper and more available, but there won’t be the services and employment.”
Like other industries, venture capital funding also has become scarce for cannabis businesses seeking investors to fuel their growth.
Without financing, it’s tough to keep as many employees on staff, said Karson Humiston, founder and CEO of Denver-based cannabis recruiting network Vangst.
“People are really tightening the belt and working to preserve cash because funding is hard to come by,” Humiston said.
“When companies have a harder time raising capital, they need to make sure they have enough cash to weather the storm. The first thing to go is expensive headcount.”
The majority of job cuts are at the senior level – not hourly employees who work in grows or retail shops, Humiston said.
And with many multistate operators using more gig employees than in the past, Vangst is having its busiest summer ever.
“People are still purchasing and consuming cannabis, so these hourly workers are essential,” she said.
“Cannabis still needs to be grown, packaged and delivered to customers. Those are hourly roles.”
Source: https://mjbizdaily.com/cannabis-companies-lay-off-hundreds-retrench-amid-economic-woes/
Business
EU Pressure Builds on Google as Regulators Face Calls for Massive Fine Over Search Practices
A growing coalition of European industry groups is intensifying pressure on regulators to take decisive action against Google over allegations of unfair search practices that could reshape competition rules across the region’s digital economy.
Investigation Under Digital Markets Act Gains Momentum
The case is being examined by the European Commission under the European Union’s landmark Digital Markets Act (DMA), introduced to curb the dominance of major technology platforms and ensure fair competition.
Launched in March 2024, the investigation focuses on whether Google has been prioritising its own services in search results, potentially disadvantaging rival businesses that rely on online visibility to reach customers.
Industry Groups Demand Swift Action
Several prominent European organizations have jointly urged regulators to conclude the probe without further delay. They argue that prolonged investigations allow alleged anti-competitive practices to continue, putting European companies—especially startups—at a disadvantage.
Signatories include the European Publishers Council, the European Magazine Media Association, the European Tech Alliance, and EU Travel Tech.
In a joint statement, these groups warned that delays in enforcement are affecting innovation, profitability, and growth prospects for regional businesses competing in digital markets.
Google Denies Allegations
Google has rejected claims of bias, stating that its search algorithms are designed to deliver the most relevant and useful results to users. The company has also proposed adjustments to address regulatory concerns.
However, critics argue that these changes are insufficient and fail to address the core issue of market dominance.
Potential Billion-Euro Penalties
If found in violation of the DMA, Google could face significant financial penalties. Under EU rules, fines can reach a substantial percentage of a company’s global turnover, potentially amounting to billions of euros.
Regulators may also impose corrective measures requiring changes to business practices, which could have long-term implications for how digital platforms operate in Europe.
Wider Implications for Big Tech
The case highlights ongoing tensions between European regulators and major U.S. technology firms. In recent years, the EU has taken a more aggressive stance in enforcing competition laws, aiming to create a level playing field for local businesses.
A final ruling against Google could set a major precedent, influencing future enforcement actions and shaping the regulatory landscape for global tech companies operating within Europe.
As scrutiny intensifies, the outcome of the investigation is expected to play a critical role in defining the future of digital competition across the European Union.
AI & Technology
Amazon Faces Potential Criminal Trial in Italy Over €1.2 Billion Tax Evasion Allegations
Milan: U.S. tech giant Amazon is facing the prospect of a major legal showdown in Italy, after prosecutors in Milan formally requested a court to move forward with criminal proceedings over alleged tax evasion totaling approximately ₹12,500 crore (€1.2 billion).
The case targets Amazon’s European division along with four senior executives, marking one of the most significant tax-related investigations involving a global e-commerce platform in Europe.
Trial Push Despite Multi-Million Euro Settlement
The move comes even after Amazon reached a financial settlement with Italian tax authorities in December, agreeing to pay around ₹5,500 crore (€527 million), including interest, to resolve part of the dispute.
Typically, such settlements lead to the closure of criminal investigations. However, Milan prosecutors have opted to proceed, signaling a tougher stance on alleged corporate tax violations.
A preliminary hearing is expected in the coming months, where a judge will decide whether to formally indict the company and its executives or dismiss the case.
Allegations of VAT Evasion Through Marketplace Sellers
At the center of the investigation are claims that Amazon’s platform enabled non-European Union sellers to avoid paying value-added tax (VAT) on goods sold to Italian consumers between 2019 and 2021.
Prosecutors allege that the company’s marketplace structure allowed thousands of foreign vendors—many reportedly based in China—to operate without fully disclosing their identities or tax obligations. This, authorities argue, led to substantial VAT losses for the Italian government.
Under Italian law, online platforms facilitating sales can be held partially liable if third-party sellers fail to comply with tax requirements, a key point in the prosecution’s case.
Italian Government Named as Affected Party
In their filing, prosecutors identified Italy’s Economy Ministry as the injured party, citing significant financial damage resulting from the alleged tax evasion.
Legal experts say the outcome of the case could have wide-ranging implications across the European Union, where VAT systems are harmonized and similar compliance rules apply to digital marketplaces.
Multiple Investigations Add to Pressure
The VAT probe is just one of several legal challenges facing Amazon in Italy. The European Public Prosecutor’s Office is reportedly examining additional tax-related issues covering more recent years.
Meanwhile, Milan authorities are pursuing separate investigations into alleged customs fraud linked to imports from China and whether Amazon maintained an undeclared “permanent establishment” in Italy—potentially exposing it to higher tax liabilities.
In a separate regulatory action, Italy’s data protection authority recently ordered an Amazon unit to stop using personal data from over 1,800 employees at a warehouse near Rome.
Amazon Denies Allegations
Amazon has consistently denied wrongdoing and indicated it will strongly contest the allegations in court if the case proceeds. The company has also warned that prolonged legal uncertainty could impact investor confidence and Italy’s appeal as a destination for international business.
Broader Impact on Europe’s Digital Economy
If the case moves to trial, it could become a landmark moment for the regulation of global e-commerce platforms in Europe. Governments across the region are increasingly scrutinizing how digital marketplaces handle tax compliance, especially in cross-border transactions.
With online retail continuing to expand, regulators are under mounting pressure to ensure that multinational platforms and third-party sellers adhere to the same tax rules as traditional businesses.
Aviation
IndiGo Crisis Exposes Risks of Monopoly: What If Telecom or E-commerce Collapses Next?
Airports across India witnessed scenes of distress and confusion as thousands of passengers were stranded due to IndiGo’s massive flight disruptions. Families with medical emergencies, funerals, and personal crises were left helpless as the airline cancelled hundreds of flights without adequate communication or support.
Passengers described desperate situations — a mother pleading for sanitary pads for her daughter, a woman unable to transport her husband’s coffin, and others stranded while trying to reach family funerals or hospitals. “It was like a lockdown at the airport,” one passenger said, describing the panic that unfolded as IndiGo’s mismanagement crippled operations nationwide.
Root Cause: IndiGo’s Market Monopoly
The turmoil, industry experts argue, stems from IndiGo’s monopolistic control over India’s domestic aviation market. The airline operates nearly 2,100 flights daily and holds around 60% market share — meaning every second plane flying within India belongs to IndiGo.
This dominance has given the company unparalleled influence. When IndiGo falters, the entire aviation system suffers. Passengers are left with few alternatives, as other airlines lack capacity to absorb stranded travellers. The result: skyrocketing ticket prices, chaos at terminals, and total dependence on a single private operator.
Aviation pioneer Captain G.R. Gopinath, founder of Air Deccan, criticised the government’s inaction, noting that on some routes, IndiGo’s economy fares surged to ₹1 lakh. He compared the situation to a hostage crisis, writing that the airline “held the system ransom” and forced regulators to defer new safety rules meant to protect pilots and passengers.
Government Intervention and Regulatory Weakness
The crisis erupted after IndiGo failed to comply with the Flight Duty Time Limitations (FDTL) — rules introduced by the DGCA in January 2024 requiring adequate rest for pilots. Despite having nearly two years to adapt, IndiGo blamed the rule for operational disruptions, citing a shortage of pilots.
Under mounting public pressure, the government stepped in, temporarily relaxing FDTL norms and capping airfare hikes. Officials claimed the move was to protect passengers, but analysts say it exposed the state’s vulnerability to corporate monopolies. “The government had no option but to yield,” said one aviation policy expert, pointing out that ignoring safety regulations for short-term relief could have long-term consequences.
The crisis also rekindled memories of the June 2025 Air India crash near London, which claimed over 240 lives. Experts warn that compromising pilot rest and safety standards to maintain flight schedules could risk another tragedy.
If Telecom Giants Fail: A National Paralysis
The article raises a troubling question — what if a similar crisis struck the telecom sector, where Jio and Airtel together control nearly 80% of subscribers and serve over 780 million users?
If both networks failed simultaneously, the repercussions would be catastrophic. Internet shutdowns would halt UPI transactions, online banking, OTP verifications, video calls, OTT streaming, and emergency communications. Critical services such as airports, hospitals, stock exchanges, and small businesses — many of which rely on WhatsApp and digital payments — would come to a standstill.
In essence, a telecom breakdown could paralyse India’s digital economy, exposing the nation’s dependence on a duopoly.
E-commerce Monopoly: Another Fragile Ecosystem
The same risk looms over the e-commerce sector, where Amazon and Flipkart dominate nearly 80% of the market. A disruption similar to IndiGo’s could cripple daily life — halting delivery of groceries, medicines, and essential goods, freezing refunds and customer support, and leaving small sellers without platforms to trade.
Local retailers, freed from competition, might exploit shortages by inflating prices. Such a scenario underscores the perils of market centralisation in sectors critical to everyday living.
A Wake-Up Call for Regulators
The IndiGo crisis, analysts say, is a warning shot for policymakers and regulators. A single company’s operational failure exposed systemic weaknesses in India’s infrastructure and consumer protection mechanisms.
As the aviation regulator DGCA investigates and IndiGo works to restore normalcy, the broader lesson remains clear: unchecked monopoly power in any essential service — whether air travel, telecom, or e-commerce — poses a direct threat to economic stability and citizen welfare.
Without stronger competition laws, redundancy frameworks, and regulatory oversight, India risks repeating this crisis across multiple sectors — each time with millions of citizens paying the price.
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