The number of small businesses that are unable to afford their full rent is climbing, according to an Alignable poll of 2,880 small business owners in Canada and the U.S. conducted from late August to late September. For the first time in six months of surveys, the majority of restaurant owners couldn’t pay full September rent; the portion rose 6 percentage points from August to reach 51%. Forty percent of retailers, defined by Alignable as sellers of non-consumable goods, found themselves in a similar situation, up 3 percentage points.

In September, 35% of U.S. small businesses couldn’t pay full rent, up 5 percentage points from August, according to Alignable’s September Rent Report. For Canadian small businesses, the figure rose 6 percentage points to 38%. Many cited the surge in COVID-19 delta variant cases, skyrocketing inflation and an ongoing labor shortage as reasons.

Businesses that rely on in-person contact were most affected. Among small businesses, 48% of massage therapists couldn’t pay September rent, up 26 percentage points from August; 46% of beauty salons could not, up 5 percentage points; 42% of construction companies could not, up 11 percentage points; and 38% of gyms could not, up 5 percentage points.

Tenants ask for help

A third of small businesses cited attracting customers as the biggest obstacle, followed by hiring and staffing at 18%, inventory and supply chain difficulties at 14% and nonpayroll monthly obligations like rent and utilities at 10%. Tenants say they need more help from their landlords. According to Alignable, 82% of small businesses have received no rent reductions, rent deferrals, rent abatement or assistance in applying for government loans. Nearly half the respondents that reported having landlords said rent assistance would be the most helpful thing those landlords could do.

Some landlords have been helping out. Seven percent of small business tenants said their landlords have helped tenants apply for government emergency loan assistance; 5% said their landlords have deferred rent; 3% said their landlords have reduced rent payments; and 2% said landlords offered rent abatement.