With the country preparing to open up an entirely new industry on Oct. 17, Canadians may be curious about how legal recreational will not only impact their daily lives – but also the economy.

The man who has been tasked with leading Canada’s new system of tracking cannabis spoke to BNN Bloomberg about how Statistics Canada plans to monitor the sector, the challenges of collecting reliable information and the impact the illicit marijuana market will have on this new data.

Below is an edited version of BNN Bloomberg’s conversation with James Tebrake, director general of macroeconomics at Statistics Canada, about how the agency is gearing up for one of its most intriguing data collections yet.

Q: Cannabis is an entirely new industry opening up in Canada. How is Statistics Canada preparing to track it?

A: We’ve already started doing quite a bit of it. Currently, a lot of the data we're collecting is what you'd think as more on the demand side: we're going to households through surveys and asking them about their consumption of cannabis. We've been doing this for years, but we ramped up this activity during the last year.

Another source that's been quite successful is we set up a crowdsourcing app to collect citizen-generated data on cannabis prices, where people are freely telling us what price they're paying for cannabis and a little bit of their usage. It's given us a pretty good indication of the current illicit price and we've done quite a bit of analysis, because obviously there are some statistical biases that can sneak into data like that.

We're experimenting with another thing that's quite unusual, where we worked with some municipalities in Canada to collect wastewater samples that we send to a lab where they tell us what their THC content is. We're developing models that allow us to try and predict what the level of cannabis consumption was needed to produce the presence of that THC (tetrahydrocannabinol) within that wastewater sample. If the model is developed well, this may be our best measure of aggregate consumption in an area.

The other avenue that’s now open to us is collecting data from the federally-licensed holders and provincial retailers. Of course, this is a little bit more traditional.

Q: What kind of statistics do you plan to provide after Oct. 17?

A: There’s a whole host of data, everything from more health-related statistics to telling Canadians how many people are consuming cannabis in Canada and their demographics.

It'll take a little bit of time, but eventually people will want to understand the health outcomes. Similarly, there will be a lot of demand for data on impaired driving. Those will be statistics that will be coming through our justice statistics program.

Then there's a whole host of economic data that will be coming out. Everything from household spending on legal and illegal cannabis, to production, gross domestic product of the cannabis industry, the number of jobs related to cannabis, agriculture production, the retail sales. Almost every single economic program that we have at Statistics Canada is currently being updated to try and capture particular aspects of the legalization of cannabis.

Q: You’re going to start including data on legal recreational marijuana and the illegal market in Canada’s GDP. Why wasn’t the illegal market included before?

A: We're questioning it ourselves, whether we should have been including this even though it was illegal. The international guide that tells us how to measure GDP says you need to include legal and illegal activity when you're measuring GDP. Our decision was that it's not that significant, so we're going to exclude it.

Of course going through this exercise over the last year-and-a-half we've been collecting all this data together, we’re saying that ‘Well, we thought it wasn't significant, but it’s more significant than we thought’ – and maybe, we should be including it.

Q: How will the inclusion of cannabis affect key economic data?

A: After marijuana is legalized, we're going to incorporate this sector when we release the fourth quarter GDP report in February 2019. We’re going to incorporate both legal and illegal production, consumption and use of cannabis and we'll provide a split between those two things. Of course for the illegal portion, probably the data quality will be less than the legal one.

When we release the accounts in the fourth quarter, just because of revision policies and things like that, we're only going to show the activity in GDP for that quarter. That kind of creates a break between it and the third quarter because – even though the activity existed in the third quarter, mainly illegal – we're not going to put it in. But we do have a whole separate product called the Cannabis Economic Account that actually tracks cannabis production, use and consumption all the way back to 1961. When we release GDP, all that data will be there. We're going to try to give Canadians the true growth rate or the non-broken growth rate in the fourth quarter and we will be very clear in our communications around that.

Q: What are the main challenges with tracking the marijuana sector?

A: Obviously, the main challenge prior to legalization is the fact that it’s been illegal and we have no way of tracking the supply of cannabis in the economy. I thought the demand side was going to be more challenging, but Canadians have been extremely cooperative in providing us with information. In fact, I think it’s interesting to see how much Canadians want the answers as much as we do.

Q: It’s not often a country gets to go through something like this. Has there been foreign interest on how Canada monitors legalization?

A: Very much so. There are two aspects: There’s the cannabis aspect of ‘Could we legalize it? Could we learn some lessons from Canada in terms of policy? What data needs to be collected?’ We're definitely sharing some of those lessons with other countries.

But bigger than that, and this has kind of been the focus of this project, is beyond cannabis: This is a bit of an interesting – “social experiment” isn't maybe the right term – maybe “social experience,” where you get something moving from illegal to legal. How does that impact individuals' behaviour? Whether it's cannabis or whether it's some other activity, there's not a lot of data around that.

Q: Why do you think tracking this data matters?

A: It matters because this is a big social change and lots of people have questions. There's a good debate surrounding the legalization of cannabis and people want to try and understand the outcomes.

Then as I said, from an economic point of view, three or four years ago I would've said it's not that significant. Now, we're talking about a fairly significant industry with employment, with investment.

Cannabis Canada is BNN Bloomberg’s in-depth series exploring the stunning formation of the entirely new – and controversial – Canadian recreational marijuana industry. Read more from the special series here and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.