A few days ago, Ted Rossman, a senior industry analyst at the financial information website Bankrate, was taken aback while eating a sandwich at Newark Airport in New Jersey.
According to Reuters, Rossman went to a self-service kiosk to buy snacks before boarding, scanned and paid for his purchase using a QR code, only to be prompted to leave a tip.
With no one else involved in the transaction except for a vending machine blinking at him, Rossman was surprised. “People are being asked to tip more than ever before,” Rossman said. “Some crazy examples are things you never would have thought about 10 years ago, and it’s becoming increasingly hard to avoid.”
Based on a new survey by Bankrate, it seems that Americans have had enough, with 59% of respondents expressing a negative view towards tipping, some even holding multiple negative perceptions.
This might explain why the percentage of people tipping generously is decreasing in almost every conceivable setting compared to 2021. For delivery drivers, this figure has gone down from 59% to 51%; for cab or ride-share drivers, it has decreased from 48% to 41%; for hotel housekeeping staff, it dropped from 28% to 22%; and for coffee shop servers, it has gone down from 23% to 20%.
“The tipping culture in America has really gotten out of control,” said Kashif Ahmed, a financial planner at a private wealth management company in Bedford, Massachusetts. “I know many people rely heavily on tips for the majority of their income, but businesses are starting to ask for tips without providing extra service.”
The widespread dissatisfaction with this situation is evident. In another WalletHub survey, 74% of Americans feel that tipping has spiraled out of control, 57% believe that businesses are merely using tips to replace wages, and 27% admit they would reduce tip amounts upon seeing a tipping prompt on a screen.
It is important to note that this is not intended to disparage hardworking customer service staff. The federal minimum wage for tipped workers is only $2.13 per hour, with millions of people depending on tips to make a living.
However, there is growing skepticism among the public that businesses are shifting the burden of paying employees onto customers to cut costs. According to the Bankrate survey, 37% of respondents believe that businesses should raise employee wages rather than relying heavily on tips.
Rising inflation is driving up the cost of almost everything, and the constant pressure to tip is sparking a strong backlash.
Amidst the pervasive demand for tipping, here are three things to consider:
One hidden secret behind “tip inflation” is the default tip amounts set on touchscreen tablets, often offering choices like 18%, 20%, 25%, or even 30%. Don’t feel compelled to follow these defaults; look for a “custom” tip option nearby and input a tip amount you consider appropriate.
During these tipping moments when a line of people is behind you, and all eyes are on you, including the barista, you may feel guilty and ashamed not to appear stingy. If tipping is not required or you don’t have the extra funds, don’t succumb to emotional pressure due to what others might think.
Don’t let anger towards excessive tipping demands affect your tipping behavior. Be discerning about situations where tipping is truly warranted and be generous when necessary.
“Do you need to tip the person entering your order on the touchscreen? Not necessarily. If given the chance, you could very well input your order yourself,” suggested Andrew Herzog, a financial planner in Plano, Texas. “But do you really need to tip those cutting your hair, delivering pizza, or providing you service? Most likely. Tipping should apply to things you can’t or don’t want to do yourself.”
In conclusion, while the tipping landscape in America is evolving, it’s essential to assess each tipping situation thoughtfully and act accordingly.