Fun Friday: Alcohol, Marijuana, and Tech


Happy Friday everybody! A friend of the office recently noted that we haven’t been discussing beer nearly enough lately. And it turns out she was right. After our office’s first, real recreational marijuana forecast last year and the Oregon Vice research and presentation I did, our office has been mostly focused on the evolving macro environment this year (more next week). Given this, and the fact that our office recently reconvened our marijuana forecast advisory group, I thought I should rectify the oversight.

Let’s start first with an update to the comparison you never knew you wanted, but are now glad you have. Over the past decade, or since the start of the Great Recession, Oregon’s thriving alcohol, and marijuana sectors have added more jobs than one of the state’s economic pillars: the high-tech cluster. Of course these economic sectors are not directly related, but instead are being used to help frame the discussion for just how fast, and how many jobs are being added here in the state.

We use this chart regularly in our presentations to discuss a variety of legitimate economic topics, including the transition from hardware to software within the tech industry, in addition to the true economic impact from vice sectors lies not with the growing and retailing of the products, but in all the ancillary and support industries that grow along with consumer demand and evolving markets. At its roots, Oregon’s alcohol cluster is value-added manufacturing where firms take raw ingredients — many of which are locally-grown — and turn them into a much more valuable products sold across the state and increasingly around the world. Furthermore, a plurality of brew system manufacturers in the U.S. call Oregon home. So when a new brewery opens up elsewhere in the country, there is a good probability they are buying and using Oregon-made equipment.

Our office’s hope is this type of cluster similarly develops around the recreational marijuana industry as well. Prices continue to plunge as the market matures and marijuana commoditizes. But increasing market activity in extracting oils, creating creams, making edibles in addition to hopefully building up the broader cluster of lab testing equipment, and branding and design firms, means Oregon will see a bigger economic impact from legalization.

Note that the reason for the range of marijuana-related employment in the chart is due to data availability. Our friends over at Employment do a great job of matching employment records to OLCC licensed businesses. Their latest count totals 5,300 jobs in Oregon. Now, these are payroll jobs (technically jobs subject unemployment insurance). Given harvest seasonality, part-time work, independent contractors and the like in a still federally illegal industry, it is reasonable to expect these payroll jobs to be more of a lower bound. However, if we turn to OLCC marijuana worker permits, those currently number 36,000 which is too high. Triangulating a more reasonable estimate — either via a rough sales to employee ratio, or scaling by a similar factor as food handler cards to food service jobs — shows there are probably about 11,000 or 12,000 marijuana-related jobs in the state today.

Finally, I have also been updating my Oregon brewery production numbers to track start-ups, the state’s legacy breweries, and also closures or failures. Given the outright declines in the beer industry overall, and slowing growth in craft beer sales, there has been quite a lot of hand-wringing over what it means. No doubt, retail shelf space is limited and the competition is fierce. Some breweries are seeing substantial declines in their sales and production. However that does not mean the industry overall is unhealthy. In fact, brewpubs continue to thrive, and some of the bigger breweries are revamping their tasting rooms, and adding more locations for better direct-to-consumer sales given they maximize revenue per pint this way. Elon Glucklich at The Register-Guard has great article on this, with a focus on Eugene breweries.

However, as Warren Buffet said, “only when the tide goes out do you discover who has been swimming naked.” For breweries this means that business plans, practices and operations matter considerably more in a world of slowing growth then they do during the go-go days of double-digit gains every year. Slower growth can strain business finances, eventually leading to more closures or failures. So, are we seeing this here in Oregon? So far the answer is no. Yes, the absolute number of brewery closures has risen in recent years, but the closure rate has barely budged. The reason is Oregon has quadrupled the number of breweries in the state over the past 15 years. As such, we should see more closures given there are so many more potential places to run into issues — be they low sales, high costs, personal problems, or the like. To date, Oregon breweries are closing at a significantly lower rate than other types of businesses across the state.

UPDATE: It it also helpful to put the number of closures in perspective with the number of openings. Economists tend to refer to this as churn. There are always new businesses forming and others going out of business. Additionally around 1 in 8 workers in Oregon are gaining or losing a job every single quarter. While topline economic indicators tend to be pretty stable, or show solid gains, there is an incredible amount of churn below the surface. This occurs in good times and in bad. So far, even as brewery closures are rising some overall, the number of new breweries in the state continues to outpace closures by a margin of 4 to 1 in the last three years.

Next week I will have a few posts on the macro outlook, as we meet with our economic advisors to nail down the 2019-21 biennium outlook. Our forecast will be released Nov 14, at which time we will also have an updated recreational marijuana forecast that incorporates all of the latest data and input from our advisors.

Last but not least, a special thank you to Beth Dyer at Employment for helping me get all of the industry data to build the clusters!

Source:Oregon Economic News

Growing Pains – Finding The Right Host


When you are looking for someplace to host your website, or web/cloud based business, location matters just as much as it does for real estate: Location, Location, Location!

house sales up

Over the last five years Eugene Daily News has grown from a big idea, into a presence in Lane County. Originally started in 2011, we’ve consistently out grown our web hosts and our servers. We knew that there was a place for an online only news/lifestyle media centered here in Eugene, but we hadn’t anticipated growing to 75k+ monthly unique readers. Thank you by the way for supporting EDN.

With the founders backgrounds in game and web based products, we knew we could bring a breath of fresh air, if you will, to local news.

We had decided to setup EDN on WordPress with the simplest hosting we could find, just to try things out. Initially starting with a little website on, it took about 90 days for us to outgrow that host. While it is a terrific and inexpensive hosting option for blogs and low traffic sites, we quickly found we needed something a little more robust and fast. Hosts like GoDaddy have increased their offerings substantially over last half decade including many of the sites listed here: “Top Ten Website Hosts“. Before re-locating to self-managed virtual server hosts, we have used and with good results. Newer offerings like are even more impressive, although a little limited offerings wise for our needs. Check out The Top Ten Listing and see what we mean.


We then moved to Media Temple, a next level host with much more control, bandwidth and of course cost. This lasted us for another year and a half, but the same issues kept creeping up: increasing costs, increased traffic and an increasing number of articles posted by EDN. We next decided to try a virtual server host: Rackspace. While geared to much larger ventures than ours, it had all the control we could want and the bandwidth to match. At least until we started getting serious about hard news and public record postings. As soon as Lane County Mugshots joined forces with us, we found our traffic surging heavily. Along with this surge came a big jump in cost to keep up. This type of host requires you understand how to setup, configure, manage and secure your server and site as if you were running it from a physical server at your location…without the hefty electric bills and server expense.


Then we discovered Digital Ocean! Still a self-configure/manage/setup host, the speed and flexibility was just what we needed. When our traffic more than doubled earlier this year causing site outages and a serious overloading problem, we were able to scale our servers to manage the load with little or no hassle and a modest price too. To give you an idea, Eugene Daily News runs it’s own ad servers and currently serves more than 3 Million ad views each month, in addition to more than 650k pageviews we serve each month. That’s a lot of ones and zeros.

When you start looking for a virtual place to setup your online business or blog, take the time to investigate your options, price matters, but as only one corner of the pyramid, you need to consider your time, your skill sets, and your anticipated demand.


Ever Want to Type 212 Words Per Minute?


Old School Typewriter MechanicalsRecently, Barbara Blackburn of Salem set the world record for fastest typing. She achieved cruising speeds of 150 to 170 words per minute, and peak speeds of 212 wpm. She set the record using a Dvorak keyboard. Being the geek that I am, I know what a Dvorak keyboard is, but in case you don’t know, a little background is in order.

Back in the dark ages, before thought guessing touch keypads, “lol” speak, and intent surmising algorithmic software assistants, there was the mechanical typewriter. For its time it was a mechanical marvel, but there was only one problem, it would clog up if the user typed too fast. So, the engineering solution was to figure out the frequency of letters in words and put the most used letters out of reach, which resulted in the QWERTY keyboard, named after the top row of letters in the arrangement.

As time went on, typewriters were replaced with hard plastic computer keyboards full of switches and springs, some function keys and if you were upscale, a number pad. Being forced to type each unabbreviated letter of every thought, we quickly learned to be obsessed with speed, typing speed.

Typing Goddess 2000 v38.0.1 promised the ability to train you up to fingerprint blurring levels of touch key prowess. Spring modifications and sound enhancements promised better tactile feedback and response to enhance your focus and eke another 20 words per minute.

Out of the many strange and even amazing typing enhancement ideas, inventions, and constructions they produced, one discovery rose above the rest:  The Dvorak Keyboard, which did the opposite of the QWERTY keyboard, i.e. it put all of the most used letters on the homerow.


The surprisingly popular Dvorak Keyboard - Eugene Daily News
Behold The Dvorak


When you look at the layout of the keyboard, the first thing that strikes you is, where’s the home row.  Then you wonder, how on earth has this design survived in production, let alone become popular.  According to Wikipedia:

“Dvorak proponents claim the Dvorak layout uses less finger motion, increases typing rate, and reduces errors compared to the standard QWERTY keyboard. This reduction in finger distance traveled was originally purported to permit faster rates of typing, but in later years is also purported to reduce repetitive strain injuries,[2] including carpal tunnel syndrome.”

Seeing the results of Barabra’s blazing typing speed, you might try to imagine the amazing productivity gains you could achieve if you could type faster than you could think. If so, you can turn on the Dvorak option on my computer as it is available in most modern operating systems. Here is a link for how to do it on OSX, and Windows. The cheapskate physical keyboard option is to put tape with handwritten letters on your keycaps or to even remove and rearrange the keycaps. If you want to delve even deeper, you can purchase a physical keyboard from many sources, one example here.