As the cost of living surges and the economy remains uncertain, many Americans are feeling the pinch of tipping more for a wider range of services than ever before. From self-service kiosks to smartphone apps, consumers are confronted with more invitations to tip, often with pre-determined options that can range between 15% and 35% for each transaction.
But not everyone is happy with this tipping culture, which some see as a way for employers to shift the burden of paying their workers a living wage onto customers. According to a new report by Bankrate, fewer consumers now say they “always” tip when dining out or for other services, such as ride-shares, haircuts, food delivery, housekeeping, and home repairs. Two-thirds of Americans have a negative view of tipping, especially when it comes to contactless and digital payment prompts.
“Inflation and general economic unease seem to be making Americans stingier with their tipping habits, yet we’re confronted with more invitations to tip than ever,” said Ted Rossman, Bankrate’s senior industry analyst. “Now you have to go out of your way to not tip and that’s what a lot of people resent,” he added.
Some experts and consumers also question the logic and fairness of tipping based on a percentage of the bill, rather than the quality or difficulty of the service. For example, why should a customer tip more for an expensive bottle of wine than a cheap one, if the server did the same amount of work? Or why should a customer tip more for a large order than a small one, if the delivery driver drove the same distance?
“The nature of tipping is less about rewarding service providers for good service and more about social norms. Social norms have been distorted, so we don’t know when to tip,” Brian Warrener, associate professor of hospitality management at Johnson and Wales University, told CBS MoneyWatch.
Warrener said he personally does not tip when he does not receive good service or when he does not have much of a service interaction. “It’s not warranted in this case. You didn’t earn it; you don’t deserve it in this case,” he said.
Others argue that tipping is still necessary and expected when workers rely on gratuities to supplement their low wages. Tipping 20% at a sit-down restaurant is still the standard, etiquette experts say. And some consumers are willing to tip more generously to show their appreciation for frontline workers who risked their health and safety during the pandemic.
“Tipping during COVID was like a donation that recognized that frontline service employees were out there doing difficult, dangerous work. And we all appreciated it, so we all contributed a little extra to that charity,” Warrener said.
But some businesses are trying to find alternatives to tipping that can benefit both workers and customers. For example, some restaurants have adopted a service charge or a higher menu price that allows them to pay their staff a higher wage and eliminate tipping altogether. Others have adopted technology platforms that facilitate cashless tipping and enable customers to choose how much they want to give.
“Part of it is tip fatigue,” said Eric Plam, founder, and CEO of San Francisco-based startup Uptip, which aims to facilitate cashless tipping. “During Covid, everyone was shell shocked and feeling generous,” Plam said. “The problem is that it reached a new standard that we all couldn’t really live with,” he added, referring to the trend of “tip creep” where businesses ask for tips for services that did not require them before.
Plam said his company’s solution is to give customers more control and transparency over their tipping decisions. “We want to make it easy for people to tip when they want to tip,” he said. “We want to make tipping fun again.”
Relevant articles:
– Americans push back against ‘tip creep’ — ‘It’s time to take a stand,’ expert says, CNBC, June 8, 2023
– U.S Digital Tipping Culture In 2023, Forbes, June 7, 2023
– How tipping culture has changed with gratuity screens everywhere, CBS News, May 25, 2023
– America’s Tipping Etiquette 2022, Play USA, October 14, 2022