In the United States, the culture of tipping has reached an unprecedented level, causing frustration and confusion among consumers. This phenomenon, often referred to as “tipflation,” has been fueled by various factors, including the pandemic, technological advancements, and the changing job market.
The Origins of Tipping
Tipping originally emerged in the late 19th century in America as a way to incentivize prompt service from railroad workers and restaurant servers. However, tipping was controversial from the start, with critics arguing it allowed employers to exploit customers to subsidize low wages.
By the mid 20th century, tipping had expanded to other service professions like barbers, cab drivers, and hotel staff. A tipped minimum wage was established to ensure workers could earn at least a base income. Still, tipping was reserved primarily for food and hospitality jobs where custom dictated rewards for excellent service.
The Pandemic’s Influence
The COVID-19 pandemic played a significant role in the escalation of tipping. As the pandemic swept across the globe in 2020, consumers began tipping more generously to support frontline and essential workers during a traumatic period. Delivery drivers, grocery workers, salon staff, and restaurant servers came to depend on inflated tips as business dried up.
However, even as the pandemic subsided, the heightened tipping expectations remained. In fact, some businesses even increased suggested tip amounts to 20%, 25%, or 30% defaults. Workers grew to rely on generous tips to boost their wages. And many customers felt obligated to continue tipping well above pre-pandemic norms.
The Role of Technology
Technology has also contributed to the tipping surge. The advent of electronic payment systems and tip prompt screens made it easier for businesses to nudge customers towards higher tips. In many cases, customers must click through screens suggesting various tip amounts rather than deciding on their own.
This seamless prompting puts customers in a socially pressured situation, leading to increased tipping. In fact, studies show that employees receive significantly larger tips when prompts are present. The power of this subtle social pressure is evident when we consider that over 60% of Uber and Lyft customers don’t tip at all through the app.
The Job Market and Inflation
The current job market and inflation have further exacerbated the tipping issue. Businesses across many industries are struggling to attract and retain workers amidst The Great Resignation. To incentivize applicants without raising prices, many companies now highlight tips as a perk of the job.
Workers rightfully grew to depend on generous tips to boost inadequate wages during the pandemic’s economic crisis. But now, businesses are using tips as a way to increase incomes without officially raising wages as inflation drives up costs. This approach allows businesses to keep prices low in the face of inflation, but it also perpetuates the growing tipping culture.
Where Tipping Goes Beyond Restaurants
Perhaps the most frustrating aspect of tipflation is how tipping, once reserved for restaurant and hospitality jobs, has crept into nearly every service sector. Customers now face tip prompts at coffee shops, food trucks, concession stands, hair salons, taxi services, hotels, airports, weddings, sporting events, casinos, cruises, and even retail stores.
The most extreme examples include tips requested by dental hygienists, massage therapists, tattoo artists, and car dealers. There are even tip jars present at some fast food drive-thrus and gas stations. The practice of tipping has grown into an expectation rather than a simple reward for good service.
The Customer’s Dilemma
This tipping creep presents an ethical dilemma for many consumers. While customers want to support workers fairly, inflated tip expectations can feel coercive or even manipulative. And tips in lieu of wages send the wrong message to employers. But refusing to tip where it’s expected can directly hurt workers too.
Customers report anxiety and guilt around how much to tip in unfamiliar settings. And there is confusion around whether tips will truly go to workers or just pad business profits. The social pressure to tip generously makes customers feel trapped at times.
However, the tipping culture may be reaching its breaking point. A 2022 Bankrate survey found that two-thirds of customers now have a negative view of tipping expectations. And this year, tips are down nearly 10% for restaurant servers who depend most on gratuities.
While customers tip for airport snacks and footlong subs, they resent the tip creep into new businesses. And the bait-and-switch feeling of hidden fees disguised as tips breeds distrust. Experts predict many customers will soon start voting with their wallets by cutting back excessive tips.
The Future of Tipping
If the tipping culture starts to reverse course, businesses will need to raise workers’ wages in an official way. They will likely make up costs by adding service fees to purchases or raising base prices across the board. As Boston University professor Sean Jung explains, “One way or another, we’re still gonna be paying.”
In the ideal future scenario, fair wages and reasonable tipping can coexist – employees earn a living wage, while tips reward excellent service. But the current state of tipping culture has distorted a practice once meant to incentivize hospitality and gratitude.
As we move forward, it’s crucial to find a balance rewarding good service without exploiting customers and workers. With dialogue and common sense, we can restore tipping to its original purpose.