Survey: Small Business Owners Reaching to Make Rent

By: M. Scott Morris
Published: June 26th, 2024

U.S.-based small businesses are facing increasing financial challenges with May 2024 setting new records for rent delinquency and highlighting persistent economic woes. That's according to Alignable's May Revenue & Rent Report, based on responses from 4,081 randomly selected SMB owners surveyed during May plus historical data.

Key Findings:

• Rent delinquency breaks new three-year record: 46% of small business owners couldn't afford to pay their May rent in full and on time, up from 43% in April. This is the highest rent delinquency rate since March 2021.
• Soaring rent costs: 58% of SMBs report rent increases over the past six months, a rise from 54% in April.
• Revenue declines: 71% of pre-COVID SMBs are earning less than before the pandemic (up from 68% in April), with 46% making half or less of their previous monthly income. And 72% of newer business owners say they're earning less than last year. 
• Labor costs: 70% of SMBs are paying higher wages than last year.
• Interest rate: 52% say the current interest rate is negatively impacting their business, and 46% say they'll need the Federal Reserve to lower the rate by at least three points before recovery occurs.
• Credit card debt: 47% say their credit card debt is growing due to high interest rates.
• Cash crunch: 39% say they only have one month or less of cash reserves, up five percentage points from April. 
• Top concern: 33% of SMB owners cite cumulative inflation as their primary worry; 89% report higher supply costs than last year.

State-specific data:

• New York: 56% of SMB owners polled couldn't pay May rent—a record high over the past year.
• Texas and Virginia: Both at 50%.
• Florida: 47%, a 10-percentage-point increase from April.
• Michigan and Pennsylvania: 46%, each up 13 percentage points month over month.
• Illinois, Massachusetts, and Washington State: 40%, up 11 percentage points for Illinois.

Sector-specific struggles:

• Travel/lodging: 51% unable to pay May rent, up 27 percentage points from April.
• Science/tech and transportation: Both sectors see 50% rent delinquency rates.
• Retail: 46% delinquency, up 12 percentage points from April.
• Restaurants: 45%, but seven percentage points down month over month.

Click here to see the full report.

Related Stories