Americans Are Tipping Less Than They Have in Years | Hacker News Reader

Americans Are Tipping Less Than They Have in Years

wsj.com

34 pointslistenallyall89 comments

For me it's been a slow boil with the PoS terminals asking for aggressive tips on small $ transactions. Recently I decided

- Tip generously for in-person seated dining where I'm waited on (20-30%)

- Tip generously for bartenders (say, $20 cash up front if I'm going to be there for awhile/ordering multiple rounds)

- Zero tipping anywhere else.

No, I am not tipping 20% for an ice cream cone. I used to tip $1 for coffee, but I'm not going to go through the trouble of overriding the built in 15/20/25% suggested amounts on the screen, I'm just going to press "No Tip".

> overriding the built in 15/20/25% suggested amounts on the screen

That's the most ridiculous bit. I try doing "custom tip" and it is cumbersome, not to mention stressful because the server is the one holding the device for me... waiting and glaring (I don't blame the servers of course.)

I do blame the servers in a way, they are the ones demanding the requesting of tips on more, and more things. That's how the tipflation began and that is how it is growing. Now it has been said some hotels are asking you to tip when checking in. Consumers hate the pressure and so I don't think it's the businesses that are pushing the increase in tipping.

Servers and cashiers have had no input whatsoever into decisions to add tipping prompts to PoS terminals.

Even assuming that's true, why do you think that started to happen?

Do you think that servers just suddenly got greedier?

Or is it possible that the reason they're asking for more tips is because the tips they're getting aren't going as far, due to various systemic issues like inflation?

With the switch away from cash, it looked like some workers were losing tips at PoS terminals. So they added aggressive tip suggestions. Employees now have to pay taxes on their non-cash tips, and now employers realize they can pay their workers even less, to boot.

I don’t think they are. I think it’s the owners that are trying to buy good favor while still paying less. “I tried to pay you more! Look at the 30% button I had them add!”

Why is ice cream not deserving but coffee is? Coffee isn’t carried out to the table.

For that matter, why are bartenders tipped? They can turn around a drink in seconds. That being said, I also tip bartenders

Bartenders are special, they've always been traditionally tipped and also they also manage an informal queue. In cases where I'm tipping $20 (or more) up front it's because it's busy and it's literally a bribe to put me at the front of the queue. Tip-as-a-bribe is socially useful to me and any job where I can effectively bribe for better service, I will.

Coffee is marginal. The places in walking distance to my house get a tip because I have a personal interest in them remaining open (if they go out of business perhaps I have to walk further for coffee). Ice cream shop, I unfortunately just care less if they go out of business.

It's become silly. I go to Starbucks and buy a pre-packaged item. I walk to the counter. I put the item in front of the scanner. The operator pushes a button and the total appears. I put my credit card atop the credit card reader. The credit card system asks for a 15% tip.

This is too much.

Indeed, you need to tip for the privilege of self service.

Just pay your freaking workers. I’m sick of paying for labor someone else benefits from.

Where I live (NZ) nearly all cafes have a manual espresso machine and making a coffee is a bit of work. We don't have a tipping culture at all, but I'd gladly tip a dollar to a barista who makes a better than usual coffee.

When I visited the US recently I noticed that manual coffee machines aren't much of a thing anymore - or maybe it was an area thing because I don't recall this being the case when I lived in the US briefly 10 years ago.

The upshot of this is - it's not skilled work to produce a coffee, they're not as good (on average), and they're easily 2-3 times the price per coffee after tipping. I can only assume that cafes in the US are making an absolute killing.

Everyone wants a tip now, so what was previously an annoying but understandable practice for very service-oriented roles (where the service could dramatically change outcomes) morphed into an effective 20% sales tax on every human you interact with.

I tip people who handle my exposed food and luggage. Nobody else.

Given the anecdotes that few people tip for food delivery, I would be curious how much delivery costs vs eating out when factoring the 20% social tax.

Gift link: https://www.wsj.com/business/hospitality/restaurant-tip-fati...

People are getting nickel and dimed for everything and they just can't afford it anymore.

Where I live we eliminated allowing tipped workers to be paid under minimum wage, and minimum wage is now at least $15/hour.

So yes, now I tip people a little less because I know they aren't being paid $2+tips/hour. That was the entire point of eliminating that weird loophole.

>Some restaurants have added mandatory gratuities and service fees to bills, driving up bills and resulting in some diners tipping less.

Businesses just need to be honest about pricing and wages. Let the listed prices be the actual price, and leave compensation matters strictly in the hands of workers and employers where it belongs.

Tips and fees reduce clarity and introduce resentment. Why not avoid that mess altogether?

Employers save money by convincing the employee that part of their wages are owed by the customer. And as a bonus, when things don't work out, the employee's resentment is directed at the customer instead of the employer. It's brilliant, really.

It’s amazingly effective. They also hide a lot in complexity in wage laws. By the time you step through explaining everything, most people who might be interested have lost interest so the easier to deliver narrative wins.

The divide your enemy strategy works very well, to this day. It takes a fair bit of effort and time to dig around to figure out the reality of what’s really going on.

In general, I’d say this is one large factor as to why we’re losing the class war across all sorts of issues.

I do not go to a place with fees added on. I understand why they are doing it, and they are well within their right to do so, but I feel there is still an underhandedness to it. Just raise the prices, flat if possible, and make the billing as simple as possible.

I am ok with tipping, but I am not ok with being asked to tip on top of a mandatory fee.

I carry cash when I know I'm going to be eating out. It has made it much less awkward because they are not spinning the Clover terminal around, or handing me the card terminal asking for a tip.

It's important to always pay sustenance workers in cash. Anything else is inconsiderate and rude. People in those jobs are usually dearly hanging on to the margins and causing all of their income to be taxable for no good reason is heartless.

It's also just generally a good idea to carry cash. Electronic payments have too many failure modes, not the least of which are power and connectivity. (Currently posting this from a disaster zone which is thankfully still connected to the internet.)

Guess I will be rude then. I’m not going back to cash.

Their income is taxable whether I pay with cash or card. I do not cause the tax code.

Your senses of both etiquette and empathy are bizarre to me.

Right, if I tip I am heartless? If I am heartless I may as well not tip. Delusional.

not true for taxes. most get their tips paid out in cash at the end of the night and don't pay taxes on it unless they report it all, which they rarely do.

As a server in my youth I was taught to always hit $1 for how much of tips I earned that shift, when clocking out at the end of the night. I did not know any better but it was sort of a given that is what you do.

> for no good reason

You cant think of a reason for people to pay taxes?

Cash for the win!

I still tip very generously for food delivery and table service but I will never tip a cashier at checkout and in fact I actually avoid stores that use the tip screen checkout system because I hate being guilt tripped when buying gum.

I'd really like a way to guilt trip the management at stores that do that, but I don't know how. They aren't there to confront - even if I threw a fit at the checkout line, the people responsible aren't the ones who are there.

Maybe it needs to be at a shareholder meeting?

There are far more egregious things to guilt trip shareholders meetings over if you are going for that.

You communicate to management that you are unhappy with the business practices by not giving them revenue.

They can't quantify what business practice is causing customers to leave though. They can really only quantify who comes to the store. In the US, most stores put a URL for a feedback form on their receipts. I've used these a few times to air out my grievances. I like to think it works - the bike rack and the additional self-checkout registers only came after I called the CEO a lazy loser nepo baby a few times in the feedback forms.

Avoiding this practice completely might become more and more difficult, I’ve seen self checkout systems ask for extra money.

Post pictures, please.

Not mine but some pictures here:

- https://www.cbsnews.com/amp/news/tipping-self-checkout-machi...

- https://old.reddit.com/r/assholedesign/comments/182csd2/i_go...

Makes sense to me. Terminal maintenance, electricity all these cost add up. So tip is due. After all it is customers' responsibility to keep track all expenses business incur during course of its operations. Paying just listed price and taxes is so "heartless".

I keep forgetting that listed prices, at least in the US, can be before tax.

By contrast, in the EU prices are so transparent that whenever there is a sale (in person or online), the new price has to be accompanied with the lowest price from the last 30 days - so that the customer could check how big that sale really is.

There's a small deli near me that has a self checkout system and asks for a tip, but the tip goes to the kitchen making the food, so I do think that's fair enough in a tipping culture.

Self checkout in a grocery asking for tips is a new level of dystopian though.

That sounds counterintuitive last I checked tipping has gone out of control with every terminal showing 15-20% default tip value.

Terminals are asking but that doesn't mean people are tipping, as the article points out:

> People are tipping less at restaurants than they have in at least six years, driven by fatigue over rising prices and growing prompts for tips at places where gratuities haven’t historically been expected.

It’s extra effort and embarrassing to select lower or no tip when the cashier and other customers are looking.

That's the intended dynamic.

You are being pressured into submitting to being overcharged.

According to the WSJ, not so embarrassing that people are tapping the top button that much. After a while people are just done with it.

(And while this probably isn't a major factor, it backfires for people like me. By default I tip higher than most of the canned buttons.)

I don't have access to the article but would guess that this is about a pushback against that. I've personally begun my own pushback and try to base my tipping on where I think it's reasonable and never give into awkwardness or default values.

15%? Where I live it starts at 18%. Before we swiped/taped our own credit cards a tip at chipotle was unheard of. I go to Hanlon's razor here though. The POS system just defacto has this screen and no one removes it because some people do tip.

If I walk up and order something that doesn't require labor to make and I bus my own table and throw away my own trash, I don't tip. The business owner pays the staff from what I pay for the food. If not I'll cut the business owner out of the equation and pay the staff to make my food directly. They deserve the profit.

"dropped to 19.3%..."

That's already way too high. People started tipping more because the price of food didn't keep up with wages, but that's just not the case anymore. Restaurant prices in my area have doubled in the last seven years or so, most of that coming in the last three or four years.

With one new exception (food delivery), I still tip/no-tip with the same basic policy I've always had.

If there's individualized face-to-face service involved where even a small conversation is required, I tip unless the service is grossly negligent.

If not, I don't tip.

  - Restaurant servers, hosts, and bartenders? 20% minimum
  - Barber? 30% minimum
  - Tailor? 30% minimum
  - Movers, Skycaps, & Maids? 25% minimum
  - Food Delivery? Now no.
  - Point of Sale? No.

Growing up, I used to generously tip all pizza drivers, but that's changed with the advent of ubiquitous food delivery apps like Grubhub and Instacart where there's a middleman between you and the business that made the food.

I don't how much barber and tailor cost in the US, but that can be a substantial amount like 20+$ for a barber and a few hundreds for a suit. That's, a whole lot. (SG/JP)

Yep. A proper haircut and shave is worth it. You can't turn-off your looks and people are always looking at other people--especially their faces.

For tailoring, it's a pretty rarely needed service that's impossible to do yourself, but it pays dividends for years.

It sounds stupidly simple, but if your clothes don't fit you, don't wear them.

My barber haircut in columbus Ohio was $38 prior to tip yesterday. I selected the lower tip option which was $7.70.

> Food Delivery? Now no.

Why?

On a visit to Berln last autumn I went to a small one-man banh mi place. When it came time to pay, he picked up the handheld terminal, put in the amount, and then... clicked thru the tip screen (obviously a default screen for the terminal).

Classy, helpful, appreciated.

That's the kind of service that deserves a tip.

America is legalized scam culture, where the masses are brainwashed into believing that scams such as tipping are good things. Prep your own food at home and avoid the unhealthy scam.

In my teenage years I worked as a busboy, and part of my wage was a share of the wait staff's tips.

I also worked McDonald's, including the register, and it never occurred to me that anyone would ever tip me there. (Not that at 20 cents per hamburger or regular fries a tip would amount to much.)

And this perhaps is why I have always tipped 20% for table service, and begrudge tips at the counter.

This really does not surprise me, I think it goes back to the prompt suggesting a tip amount. It kind of takes control away from the customer buy saying "You should tip one of these amounts".

I think people would rather have a line were you write down the amount instead of going through prompts. Plus to make matters worse, in many cases the server cam watch what you do.

My default tip is higher than most terminals have a button for, but if the server is standing there watching then a simple button push is what they get.

This is one area of inflation I haven't experienced, because I almost never use services that require tipping, or go to restaurants. My income is limited these days, so its partly that, but also restaurant food is just generally bad for me (food quality not great, portions way bigger typically than I want).

In Japan no one tips, customer service is fantastic, and prices are low if you want low priced goods.

In San Francisco tipping is expected for any or even no service, customer service is horrific, prices are high everywhere.

I say stop tipping.

Where I live, the minimum wage is >$20/hr. An issue is that the necessary price increases to support this minimum wage is causing revenues to drop significantly. Tips are a percentage of revenue, so people who are paid this way are empirically experiencing a net loss of income each time they increase the minimum wage.

This is exacerbated by the closure of businesses due to an unsustainable drop in revenues, which means employment opportunities are becoming more limited.

Tipping provides a degree of useful economic elasticity to many service businesses and workers that simply mandating high wages does provide. The structure of compensation matters more in outcomes than people tend to think.

I wonder why the tipping conventional amount of 15% went to 20%?

I assume because stripe and the other PoS providers somehow get a fraction of a fraction of the tips?

Under the "it's not corporate greed causing inflation" topic, Patreon and other creator platforms have been on an aggressive campaign to push users to raise their prices.

Some are sending weekly email reminders that "they noticed you haven't raised your prices, and in this time of rapid inflation, you should seriously consider adjusting to the expected market rate".

So yes, percentage agreements on transactions net payment providers more from tips.

Ah, I hadn't thought of that! Of course! When paying with a credit card, the credit card gets 3% of the payment, which includes 3% of the tip. A bigger tip means mo' mone' to the credit card company.

Standards increase over time and everyone wants to be at the higher end of a standard, slowly moving what is typical upward.

It is a percentage though. The cost of the underlying item is increasing over time so the tips increase as well. What’s the excuse for increasing the percentage applied to an increasing basis?

I usually do 20% because it's easier math

edit: only where a person interacts with me though in a serving manner like a restaurant vs. a counter

as a person that drives uber eats on the side though tips are good, I don't order food myself too expensive eg. a pizza is like $40 wtf, I'll take my flavored frozen cardboard for $5 thanks

Sales tax is 8% where I live, it's pretty simple to take that number and double it. And then you're also tipping on the subtotal and not the grand total.

The math for 10% is even easier !!

0% beats that.

10% is even easier math

I think it was pressure from employees and those pushing for higher minimum wage; $20 for example.

I tip for stuff like sit down dining where someone is coming out and bringing me food.

At many locations you’re just subsidizing business costs. The employees aren’t netting enough tips to break above actual minimum wage, so you’re literally donating to the business not the person you think you’re tipping.

Where I live, employees don't even keep the tips by law. Owner can pocket them.

Another reason to tip in cash.

You are marginally improving their wage: tipping an extra $1 makes them $1 better off.

Your point is really about minimum wage standards not "subsidization".

The rule of thumb for restaurant business costs in non-tipping-culture NZ is: 1/3 staff costs, 1/3 food costs, 1/3 everything else.

Not necessarily. In many US states, tips count for a portion of the minimum wage. So if you tip a minimum wage employee but the tip does not cause them to go above the minimum wage, you have only reduced the amount the employer is required to pay. Once the employee receives $5.12 in tips in an hour, they will get each incremental dollar of tips.

https://www.dol.gov/agencies/whd/state/minimum-wage/tipped

(Note: I know this applies to most US states; other places YMMV) Not if they're not making it up to the regular minimum wage with tips.

The federal minimum wage is $7.25/hr. The federal tipped minimum wage is $2.13/hr. If a tipped employee doesn't get enough tips to reach $7.25/hr for a particular pay period, the employer has to make up the difference.

So with low tips, all you're doing is subsidizing the employer.

>The employees aren’t netting enough tips to break above actual minimum wage

If true, illegal. A business can pay a lower nominal wage if tips are expected to supplement it above the minimum (which employees are expected to report and pay taxes on), and if they earn below it, they're adjusted to the minimum.

No, that’s the law. Employers in many service industries enjoy relaxed rates below minimum wage. The law is that if during their standard pay period, their net wage (paying below minimum for hour worked) + their total tips don’t equate to what they would have earned making federal minimum wage for the time they worked, the employer has to pickup the slack to assure they are paid at least minimum wage.

If the total sum of tips plus their lower pay rate exceeds what they would have otherwise earned making actual minimum wage rates, then the employer doesn’t have to pay any additional wages because tips picked up the slack. Also the employee is rewarded by making rates above the minimum.

In the first case, the employee getting tipped some but not enough to make minimum wage will ultimately only get minimum wage rates for their work. Your tips just close the gap a bit for the employer who would have to pay less to make sure the employee made minimum wage. So, subsidizing the employer/business.

As someone else suggested, tipping in cash is my preferred way because it allows the employee to pocket the tip without reporting, assuring the tip actually goes to them.

Overall in most cases tips should be a non-existent practice or at the very least, not nearly as frequent as it currently is. I regularly dine at several restaurants that have now included tips in their menu and service costs that assure employees are paid a fair rate. The menu prices are slightly higher but I prefer this practice because I know everyone is treated reasonably. If service staff go out of their way and above and beyond, I’ll throw in extra, which is what tipping should be, at least in my opinion.

Taxes are paid on tipped income by the employer and employee. It's not a subsidy as much as it's independent contracting plus a (nominal) supplemental base wage. There's more to the dynamic, but that's the gist.

I have a feeling we're saying the same thing, so here's the word from the source:

https://www.irs.gov/businesses/small-businesses-self-employe....

I could not read the entire article due to paywall, but I think tipping less will actually drive businesses to pay a proper wage to the people providing the service. I try to tip 5% more than the expected amount as I am aware that people working in many of these jobs are not paid enough. However, its absolutely ridiculous when I am asked to leave a tip on self checkout kiosks. That should be illegal.

> I could not read the entire article due to paywall, but I think tipping less will actually drive businesses to pay a proper wage to the people providing the service.

https://www.youtube.com/watch?v=utksPm6KgjU

The canonical commentary by Tarantino, from Reservoir Dogs.

One thing to consider –especially at "non-standard" tipping establishments– is how much of the tip goes to the server/cashier.

CBC's Marketplace did some investigating [1], and found that in many cases, the owner or manager pocket part or all of the service tip, even in provinces where this is not legal.

[1 – video] https://www.youtube.com/watch?v=LF0zJIRe1J8

[1 - text article] https://www.cbc.ca/news/marketplace/tipping-marketplace-1.73...

> I think tipping less will actually drive businesses to pay a proper wage to the people providing the service.

And what, in the behavior of businesses over the past few decades, leads you to believe they wouldn't just laugh at them and tell them they should be happy for whatever they get?

What leads you to believe a critical mass of businesses in the industries that expect tips would ever, within the current culture and legal regime, decide to compete for high-quality employees by paying them more, rather than just firing everyone who complains, and then bitching and moaning that "no one wants to work" when the applicants for the positions become fewer and lower-quality?

What leads you to believe that a bottom-up approach to this will have any effect, without a genuine change in the culture to declare tipping and the concomitant lower base pay for tipped workers unacceptable, rather than a top-down effort that actually changes the laws and regulations around it?

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