A top Wells Fargo analyst says that there’s one main reason for rising costs and worker shortages in the transportation sector: federal marijuana criminalization and resulting drug testing mandates that persist even as more states enact legalization.
Chris Harvey, who serves as head of equity strategy at Wells Fargo Securities, addressed the issue during a conference call on Wednesday. He proactively brought up the challenges associated with cannabis testing in the trucking industry.
“If you’ve listened to one conference call or a thousand conference calls, what have you heard? Logistics, transportation costs, trucker costs all going higher and that’s going to continue to occur,” he said.
“And the reason being is very simple. And some of you know this and some, this may be new,” Harvey continued on the call, which was first noted by CNBC’s Carl Quintanilla . “It’s really about drug testing. We’ve legalized marijuana in some states but, obviously, not all but some. And what you have as a trucker is you have a federal mandate for drug testing.”
— Carl Quintanilla (@carlquintanilla) February 16, 2022
Federal transportation law stipulates that safety sensitive jobs like trucking require drug testing policies. But while advocates and opponents of legalization agree that nobody should be operating a 16-wheeler while intoxicated, the problem is that THC metabolites can be detectable in a person’s system for weeks after they’ve consumed.
Because of the mandate for truckers, “we’re excluding a significant portion of that trucker industry,” Harvey said. “And so, it’s going to make a very tight market even worse.”
Backing up that point, The New York Post reported last year that more than 72,000 truck drivers were taken off the roads since January 2020 due to positive THC tests.
The financial executive isn’t the only one talking about the relationship between workforce shortages and marijuana policy.
For example, a congressman suggested last week that one way to help resolve the significant staffing problems at the U.S. Postal Service (USPS) would be to federally legalize marijuana so that government employees stop losing their jobs for using it.
Federal prohibition and strict drug testing policies within government agencies have arguably had a chilling effect on employment, preventing qualified people from applying for certain jobs and putting current federal workers in jeopardy of losing their jobs if they consume a product that’s increasingly legal in states across the country.
The problem spans from government to private industry, prompting even some of the largest companies in the U.S. to reevaluate their drug testing policies amid the legalization movement.
Amazon has worked to adapt to changing marijuana policies internally as it’s backed congressional reform, enacting an employment policy change last year to end pre-employment drug testing for cannabis for most workers, for example.
However, it stipulated that the company will “no longer include marijuana in our comprehensive drug screening program for any positions not regulated by the Department of Transportation.” (Emphasis added.)
Meanwhile, the director of national intelligence (DNI) said in a recent memo that federal employers shouldn’t outright reject security clearance applicants over past marijuana use and should use discretion when it comes to those with cannabis investments in their stock portfolios.
The FBI updated its hiring policies last year to make it so candidates are only automatically disqualified from joining the agency if they admit to having used marijuana within one year of applying. Previously, prospective employees of the agency could not have used cannabis within the past three years.
However, it’s since further revised the policy to add a stipulation that applicants are ineligible if they’ve used cannabis more than 24 times after turning 18.
Then-FBI Director James Comey suggested in 2014 that he wanted to loosen the agency’s employment policies as it concerns marijuana, as potential skilled workers were being passed over due to the requirement.
The federal legalization of hemp has also prompted several agencies to update their employment policies.
The Department of Defense, for example, made clear that CBD is off limits for service members.
The Navy told its ranks that they’re barred from using CBD regardless of its legal status.
And the Coast Guard said in 2019 that sailors can’t use marijuana or visit state-legal dispensaries.
NASA said that CBD products could contain unauthorized THC concentrations that could jeopardize jobs if employees fail a drug test.
The Substance Abuse and Mental Health Services Administration issued guidance to federal agency drug program coordinators in 2019, expressing concern about excess THC in CBD products, which seems to have prompted the various departments to clarify their rules.
The Department of Transportation took a different approach in 2020, stating in a notice that it would not be testing drivers for CBD.
For its part, the Drug Enforcement Administration continues to enforce its policy of automatically disqualifying applicants who’ve used marijuana in the prior three years before applying.
And while the Biden administration has instituted a policy of granting waivers to certain workers who admit to prior cannabis use, it’s come under fire from advocates following reports that it fired or otherwise punished dozens of staffers who were honest about their history with marijuana.
White House Press Secretary Jen Psaki has previously attempted to minimize the fallout, without much success, and her office released a statement in March stipulating that nobody was fired for “marijuana usage from years ago,” nor has anyone been terminated “due to casual or infrequent use during the prior 12 months.”
A powerful congressional committee released a report over the summer that urges federal agencies to reconsider policies that result in the firing of employees who use marijuana legally in accordance with state law.
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