Alignable: 52% Of Minority-Owned SMBs Can't Afford July Rent
Alignable’s July Rent Poll showed that many industries and groups are still coping with the lasting effects of the COVID era, while others are bouncing back more quickly.
Alignable polled 5,911 small business owners from 7/2/21 to 7/23/21 and learned that the majority of minority-owned businesses (52%) still could not pay their rent in July.
That figure is much higher than the U.S. national average (35%) and the Canadian average (43%), both of which include all demographic groups and industries.
Women Face Ongoing Issues; Veterans Are On An Upswing
More than one-third of women-owned businesses (37%) also did not pay full rent on time in July, whereas fewer male-owned and veteran-owned businesses struggled.
In fact, compared to June, the veteran-owned businesses saw a 15 percentage point increase in the number of owners who could pay their full rent. So that’s a silver lining in this report.
Unfortunately, in comparison to June, the same percentage of women-owned small businesses paid rent in July compared to June.
Only 1% more of the minority-owned businesses could pay their rent this month. And only 2% more of all small businesses could cover July rent in full and on time.
Those increases represent glimmers of hope, but are not all that significant, especially given that 33% of all business owners tell us they're fully recovered at this point and many others have had revenue gains, according to our July Road To Recovery Report.
Rent Troubles Continue For Restaurants, Retailers & Others
Sectors that continue to struggle to pay monthly rent include: nonprofits (64%), entertainers/artists (50%), transportation (48%), event planners (43%), restaurants (40%), beauty salons (39%), gyms/fitness centers (38%), retailers (37%), construction (37%), and travel (28%).
Comparing these industries to our figures from June shows more ups and downs. The good news is that more small businesses in a few industries demonstrated that they could pay their rent this month than in June.
These industries where the ability to pay rent increased included travel (up 14%), event planning (up 7%), construction (up 4%) and beauty salons (up 1%).
However, looking at our chart from June below, you can see that a higher percentage of small businesses in other industries are having more trouble paying their rent. An additional 22% of nonprofits couldn’t pay their rent (jumping from 42% to 64%), largely because they report that donations to many charities are down.
Times are tougher for transportation companies, including individual Uber or Lyft drivers, as 48% this month couldn’t pay rent vs. just 43% in June. Other industries showed increased trouble affording rent, such as entertainers/artists (up 3%), retailers (up 2%), and restaurants (up 1%).
What About The States and Provinces?
Here’s how the situation looks for regional and local stories.
As mentioned above, in the U.S., 35% couldn’t pay rent in July. In Canada, 43% of all small businesses were in the same boat.
States with the highest percentages of small businesses unable to pay full rent include GA (46%), NY (41%), MA (41%), and MD (37%).
In direct contrast, states with the lowest percentages of rent problems were TN (18%), WA (18%), MO (22%), OR (22%), AZ (24%), VA (25%), CO (26%), and FL (27%). (Those figures show another silver lining).
Here are the percentages of small businesses in other states that weren’t able to pay July rent. Many of these figures are still high, though, in past reports, some of these states were in worse shape.
- CA: 35%
- CT: 34%
- IL: 35%
- MI: 34%
- NC: 34%
- NJ: 34%
- OH: 31%
- PA: 32%
- SC: 34%
- TX: 32%
- WI: 30%
In Canada, several big regions showed that over 40% of their small businesses still couldn’t handle paying their full rent on time in July: ON (46%), BC (42%), and AB (41%).
For more information about the states or provinces, or additional statistics related to Alignable’s July Rent Poll, please reach out to me at chuck@alignable.com.
To see other polls we’ve conducted since March 2020, please go to the Alignable Research Center.
ABOUT THE ALIGNABLE RESEARCH CENTER
Alignable is the largest online referral network for small businesses with over 6.5 million members across North America.
We established our research center in early March 2020, to track and report the impact of the Coronavirus on small businesses, and to monitor recovery efforts, informing the media, policymakers, and our members.
Comments (31-40)
What are small businesses supposed to do that are new? All resources are available pending you have a tax return for the business what happens if you began in January and we're not affected until April or May? There are no resources to help at that point
Chuck, those are very informative statistics. Really put the economic impact of COVID in perspective!
Not everybody knew about the help that's available and some were worried that it would be something they'd have to pay back or they didn't qualify for some reason. My business was hard hit because I work with people one to one. And I didn't qualify for the PPL loan because I don't have employees. So, it's been rough for me too have business bills and try to manage with Social Security income. But thru it all I've managed to keep my rent paid, the lights on and food on the table.
On the heels of a prior comment....
A simple google fact check of "minority owned" small business success rates
mimic that of ALL business even prior to Covid.
Can we end this dialect of vendor diversity? This is an insult to the civil rights & equality crusaders and martyrs of recent history. Their legacy was not to be used as political cannon fodder and division or to look good on a PR campaign for some corporation.
Their strife was equal opportunity, nothing more. Affirmative action, and equality policies are well known, litigated, enforced and exercised throughout this nation.
Stop fixing something that is not broken.
Dale, I agree. This is why when one of our clients need and eviction after going to court and the judge honoring the CDC and not the Law. We used other more diplomatic solutions to the 6month non payment tenant eviction. 1. Offer to pay for 1 month storage. 2. Offer to move them. Offer to pay for a uhaul. 3. We explained to the tenant that it was already over it was just a matter of time. Our approach was either let us help you transition as allies or when we do come back we will lock the door and keep there possessions and do everything in our power to prosecute them as an enemy. A week later there family moved them out but not with out signing and agreement to move the day we visit after the eviction court. Get creative it is your property. Also offer deferred rental rates if it is commercial. If you have any questions feel free to reach out. Stay with in the law my friend.
Thank you for sharing
This is an interesting poll. Since the pandemic, every business was hit with a hardship and suffered greatly. Some business even closed, while others stayed the course, revamped, repositioned for a comeback. Rebuilding takes time. Stay with your business.
I need advise. I have been doing accounting for the construction industry for over 45+ years. I work right now for 3 companies. How do I convert to virtual bookkeeping? I run everywhere it would be nice not to have to. Can anyone help? Thanks
Now find Grant's for minority women owned businesses
Aren’t the ones doing the worst also the ones getting the most grants, tax reliefs, and funding? I wonder how much help they need to succeed? Or maybe their just in more volatile markets?