(The Center Square) – A new survey shows small business rent delinquency numbers have reached a three-year high.
Alignable’s latest rent and revenue report shows 46% of small business owners couldn’t afford to pay their May rent in full and on time. That is the highest number since the pandemic.
Researcher Chuck Casto said a couple economic conditions are to blame.
“A still high interest rate is number one,” Casto told The Center Square. “Right behind it is the cumulative effect of inflation, so those two factors are really taking quite a toll on a lot of small businesses.”
Casto added that soaring rent costs are also to blame, with 58% of small business owners saying their rent has increased during the past six months.
Small business owners said supply costs are skyrocketing, with 89% saying supply costs are higher now than this time last year.
In Illinois, 40% of small businesses couldn’t pay their rent on time or in full in May, an increase of 11% from the month before. That is the 7th highest percentage in the country.
New York has the highest percentage with 56% of small business owners who couldn’t pay their rent on time or in full. Texas and Virginia were at 50%.
The three industries facing the most rent payment difficulties are travel and lodging, science and technology, and transportation.
“The most visible small businesses, the ones on the main streets of the small towns in Illinois, they may look like they are doing fine, but many of them are not,” said Casto.
The survey is based on responses from 4,081 randomly selected small business owners, surveyed from May 1-31.
