“Tipflation” could be blamed on tablets or the post-pandemic economy — but consumers seem to be giving in to the pressure and leaving more cash behind.
Sure, most Americans report feeling negative about tipping, but service workers are earning exponentially more in gratuity than before the pandemic, according to payroll provider Gusto. From March 2020 to May 2023, hourly wages only rose 18%, compared with a 42% increase in tip earnings, the company found.
“I like tipping mainly because I have a couple of friends that work in the food industry,” Saad Kabir, a recruitment coordinator at New York City Public Schools, tells CNBC Make It. “Businesses are hurting right now, so they’re just passing the buck to consumers.”
The trend seems to be at its height in bars. Bar workers, who on average earn just above minimum wage in base pay, now make an average of $13.33 per hour in tips, both of which are up from the pandemic, according to Gusto. Of the 300,000 small and medium-sized businesses included in the analysis, bar workers made more in tips than employees in other service industries.
Some consumers say they don’t mind tipping bartenders at least 20% because of the amount of labor that goes into the job — mixing the drinks, interacting with customers and sometimes serving tables.
“I feel like it’s the most gruesome job to work in a bar, just running back and forth all night,” Fidelity Investments consultant Haley Truchan tells CNBC Make It. The Manhattan-based 24-year-old says she almost always tips 20% at bars.
Kabir agreed, saying he tips upwards of 40% for particularly good bar service.
“Bartenders, to me, are like unpaid therapists,” Yonas Haile, a 32-year-old NYC resident, says. In his experience, bartenders have to know menus, pairings and provide cultural insight to visitors. He’s even tipped 100% on bar tabs in the past, he says.
Tipping as a cultural priority
With rising costs of living, it’s reasonable to argue everyone deserves to make more money. But…
Read the full article here
Leave a Reply