Hemp was once a flourishing and even dominant agricultural crop. In the US, it was viewed as a resilient and renewable resource. Dating back to the Neolithic age, hemp was refined and given industrial applications for use in textiles, paper-making, and more. Over time, the crop was given even more uses, and there are now potentially tens of thousands of uses for it.

History of Cannabis Regulations

Hemp remained popular for its affordability and renewability until the 20th century. The first nail on hemp’s coffin came with 1937’s “Marihuana Tax Act.” At the time, there were fears in the US that industrial hemp was essentially the same as marijuana. Law enforcement discouraged farmers from growing the crop, though cultivation continued.

The last recorded hemp crop was grown in 1958, in Wisconsin. In 1970, the first formal ban on the crop took place, as the Controlled Substances Act made cultivation of hemp illegal.

Today’s Regulatory Landscape

Hemp cultivation and the sale or consumption of hemp foods are banned in many jurisdictions around the world. In some countries, hemp cultivation is legal under a licensing regimen. For example, in New Zealand, you need a license to cultivate industrial hemp. However, everyone in the supply chain requires licensing, and there are specific regulations on exact activities, including:

  • Which cultivars can be grown
  • The source of and amount of seeds
  • Record-keeping to avoid discrepancies

As different countries ease restrictions on hemp cultivation, we now have several case studies on the effects of current regulations.

Effects of Hemp & Cannabis Legalisation

Legalising hemp cultivation has led to wide-reaching economic impacts. Here are some of the significant results we’ve seen so far.


In the US, the legalisation of hemp has had a huge economic impact. In 2014, President Obama updated the Farm Bill to include the Hemp Pilot Program, which allowed some institutions to cultivate and study hemp. Hemp was only officially recognised federally in 2018.

In 2019, according to New Frontier Data, the hemp industry already produced $1.1 billion in revenue, with $2.6 billion expected by 2022. After industrial revenue, increases in employment rates are the most noticeable effect. As of 2019, legal cannabis created 211,000 full-time jobs in the US.

Unfortunately, due to federal regulations, the most trustworthy source of employment information, the Bureau of Labor Statistics, cannot provide data on job creation for cannabis plants, including hemp. However, other economic and cannabis think tanks have produced relevant studies. The most significant of these shows that the legal cannabis industry is now the biggest job creator of any industry in the US. In three years, the workforce of the industry has increased by 110%.

The job increases caused by the relaxation of cannabis crop regulations are seen in a variety of positions, including those in:

  • Farming
  • Research
  • Sales and marketing
  • Regulatory oversight

The European Union & UK

In Europe, the CBD market is booming, but not to the extent of the US or UK. The UK has the second-largest CBD market in the world after the US. The UK CBD market is expected to generate £690 million in 2021.

While demand for CBD and hemp oils, ointments, and other products are high in the UK, a few regulatory factors are setting the industry back. As is the case in the US, regulations surrounding payments that cannabis businesses can accept limit sales potential. In the UK, the lack of options such as credit cards. Finding a credit card and POS system for a cannabis business can be difficult.

In both these cases, regulations affect the ability of consumers to purchase personal-use hemp products. By exactly how much is unsure, but we do know that it’s costing them in an age when cashless payments are a necessity for even most brick-and-mortar retailers.

Cultivation of industrial hemp in most EU countries is limited to plants with less than 0.2% THC. In some countries, the limit is slightly higher. These regulations primarily affect personal-use hemp products, as well.

The bottom line

Hemp is becoming more well-known for the versatility it’s always provided. It’s also a sustainable crop that’s good for the environment when cultivated responsibly. But there are a still regulatory complications that make it a difficult industry to work in. A lot of progress has been made, but it’s up to policy-makers to make it easier for the industry and hemp itself to reach its potential.