Overall, 37 percent of respondents couldn't cover June rent. Even more alarming, 53 percent of minority business owners couldn’t afford rent in June, which is eight percentage points higher than May. In comparison, 35 percent of nonminority owners couldn’t afford rent in June.
“This data is particularly disturbing as minority business owners throughout the COVID Era have struggled more than their peers and reported receiving less support than the general population in terms of PPP loans,” said Chuck Casto, Alignable’s head of corporate and marketing, in a blog post.
It’s a significant reason why the $28.6 billion Restaurant Revitalization Fund prioritized restaurants owned by women, veterans, and socially and economically disadvantaged individuals. The initial two weeks saw applications from more than 122,000 women business owners, more than 14,000 veteran business owners, and more than 71,000 economically and socially disadvantaged individuals. In that period, 57 percent of submitted applications came from those select groups.
The states with the highest percentage of small business owners that couldn't pay June rent were New York (47 percent, up 7 percent from May), Virginia (47 percent, up 1 percent from May), and Georgia (43 percent, down 3 percent from May). The best-performing states were Colorado (20 percent, down 15 percent from May), Ohio (26 percent, down 13 percent from May), and Michigan (30 percent, down 17 percent from May).
“Beyond coping with ongoing effects of the COVID Era, several of the industries above are hurting due to inflationary pressures, including gas prices, skyrocketing lumber costs, ongoing restrictions around people who have not been vaccinated yet, and more,” Casto said.