I can't imagine how the US could not be in recession, already. Good news on any front is increasingly hard to find; housing is crashing, employees are hard to find; big tech is laying off massive numbers of employees; inflation stays high while rates rocket; credit cards are tapped out; supply chain issues; etc.

And what is going well? I can't think of anything, other than we haven't fallen off a cliff, yet, and things are far worse in most other countries (but that is all relative, and not a sign of health).

http://www.alignable.com/forum/rent-crisis-breaks-new-22-record-41-couldn-t-pay-in-nov-up-4

Rent Crisis Breaks '22 Record: 41% in U.S. Couldn’t Pay in Nov., Up 4%
Chuck Casto
Chuck Casto from Alignable
Nov 23rd, 2022

TREND TRACKER | DATA INSIGHTS | RENT REPORT -- Boston, MA, November 23, 2022: Due to high inflation, reduced consumer spending, higher rents and other economic pressures, U.S.-based small business owners' rent problems just escalated to new heights nationally this month, based on Alignable’s November Rent Poll of 6,326 small business owners taken from 11/19/22 to 11/22/22.

Unfortunately, 41% of U.S.-based small business owners report that they could not pay their rent in full and on time in November, a new record for 2022. Making matters worse, this occurred during a quarter when more money should be coming in and rent delinquency rates should be decreasing. But so far this quarter, the opposite has been true.

Last month, rent delinquency rates increased seven percentage points from 30% in September to 37% in October. And now, in November, that rate is another four percentage points higher, reaching a new high across a variety of industries.

All told in Q4 so far, the rent delinquency rate continues to increase at a significant pace, up 11 percentage points from where it was just two months ago.
Reasons Why Paying The Rent Is Getting Tougher

According to small business owners, several economic factors are contributing to this problem simultaneously, which include:

Higher rents for 52% of SMBs (up 1% from last month)
Declining monthly revenues: in October only 34% of SMBs reported earning half or less of their pre-COVID income. But this month, that figure is 7% higher: 41% are generating half or less of what they earned monthly prior to COVID
Reduced consumer spending. In October, 59% of SMB owners said consumers were purchasing less than the month prior. In November, that number skyrocketed to 73%
60% of SMBs say inflation’s really hurting their business right now (even though the inflation rate is a bit lower than it was)
One indicator of the toll inflation is taking on businesses is a steep drop in the percentage of small businesses that are fully recovered, earning as much if not more than they did monthly prior to COVID. The percentage was 24% in October, but dropped to 14% in November -- an all-time low.

All Eyes Are On Retail Now 

While many industries are negatively affected by inflation, reduced consumer spending, higher rents, and other issues, retail is one of the sectors suffering the most. 

For starters, 44% of retailers could not pay their Nov. rent (up 1%). Beyond that, the majority (52%) say their outlook for the rest of Q4 is not good:

40% expect to make less in Q4 ‘22 than they did in Q4 ‘21
10% say inflation’s so bad, they might need to close,
1% have already shut down
41% say Q4’s been disappointing so far, but they still hope for a surge in sales
And only 8% expect Q4 ‘22 will be their best quarter ever

Will Black Friday and Small Business Saturday save the day for these retailers? 

It will likely take a more concerted effort than that focused specifically on Mom & Pop operations for at least the rest of the year, but strong sales among independent retailers next weekend would be a step in the right direction.
What Other Sectors Are Improving vs. Growing Weaker

There’s plenty of discouraging news looking at the rest of the poll results, but there have been a few significant improvements in rent delinquency, too. These charts show the larger landscape across a variety of industries.
Alignable November 2022 Rent Report Industry-Specific Chart
Alignable Nov. Rent Report 2022 -- Industry Delinquency Over The Past Year

Let’s start with the more positive developments:

Travel and Lodging businesses have experienced what can only be described as a rebound – finally. Consumers are traveling again in droves and it’s showing up in these results, too. Not only is the rent delinquency rate for travel and lodging pros very low – just 13% – it has improved by 21 percentage points since October. This lowest rate travel/lodging pros have experienced in 2.5 years. Let’s see if this sector can sustain its success in December and January.
Manufacturing is also progressing well in its rebound with only 20% of small businesses in this sector unable to pay their rent, down seven percentage points since October. 
Restaurants are still having major rent troubles, but there was a seven-percentage point improvement from last month, shifting from a 49% rent delinquency rate to 42%. Yes, it’s still high, but it’s a nice jump in the right direction.
37% of those in the automotive industry couldn’t pay November rent, but that’s 12 percentage points better than the 49% statistic that sector had in October.
46% of educators are also still having a challenging time with rent, but that does represent a positive shift from 57% last month.
Transportation is down by 1% over the October rate of 46%, but it must be noted that having 45% of trucking companies, taxi services, Lyft, and Uber businesses, and the like unable to pay their full rent is still a significant indicator of the ongoing power of high inflation.

Real Estate, Construction & Beauty Sectors Are In Trouble

While there are a few silver linings in this otherwise discouraging report for small businesses, here are some of the statistics that are causing the most concern. We already discussed the troubles retailers are having, but they are not alone.

Real Estate, as a sector, saw no improvement in November and is holding steady at 37% for the second month in a row, largely due to increasing interest rates, and declining home sales. Also, there's the ongoing issue of fewer homes to sell and the cancellation of large construction projects due to fears of a full-blown recession.

Yes, this is a challenging scenario for any real estate company. But given that real estate agents are experts at negotiating rents and mortgages, it’s especially concerning that more than one-third, for two months in a row, couldn’t pay their rent.

Considering what’s happening to real estate agents, it’s no surprise to see that small businesses in the construction industry had a harder time paying rent in November.

In fact, 42% of construction company owners were unable to afford the rent (up 3% from October). Even worse, this 42% delinquency rate represents a record high for this category in 2022.
Musicians, Artists & Beauticians: Increasing Issues

The rent delinquency rate for musicians and artists also rose this month to 38%, up 1%. 

We're hearing that more entertainment gigs are being booked than they were a year ago. But, in general, consumers are starting to cut back on extra expenses, like hiring an entertainer for a company event or a private party.

So, while they’re currently out of the COVID woods, the lack of disposable income that comes with a year or more of inflation is sidelining a lot of entertainers once again.

And while beauty salons and barber shops were making an economic comeback in the early fall, their rent delinquency numbers are way up right now, breaking a record for 2022 at 57%.

This represents an increase of 18 percentage points over their 39% delinquency rate in October, and 29 percentage points over September’s rate of 28%.

Looking at the year overall, the beauty industry has been on a roller coaster ride in terms of its financial stability, but this has been its worst month yet.

Moving on from the key industries affected by rent delinquency, let’s see how Canada and particular states are faring in this economically challenging landscape.
Rates Rise In MI, NY, TX, IL, OH & CO
States and how they weigh in on rent delinquency in Nov. '22 report from Alignable