Rising Backlash Against Tipping as Data Shows Decline in Service Industry Tips

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ICARO Media Group
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15/12/2023 23h43

According to a report by the Wall Street Journal, there is a growing backlash against tipping as new data reveals that some service industry workers are receiving fewer tips compared to last year. The decline in tipping has raised concerns about the financial well-being of those who rely on gratuities for a significant portion of their income.

Data from payroll provider Gusto indicates that as of November, service-sector workers in non-restaurant jobs experienced a 7% decrease in tips compared to the previous year. This decline amounts to a reduction from earning $1.38 per hour in tips to $1.28 per hour. Meanwhile, the holiday season has brought some cheer for workers in restaurant jobs, as Gusto's report also highlights a 3% increase in tips compared to November last year.

The reasons behind the decline in tipping are multifaceted. Some consumers argue that tipping has become pervasive, with various industries expecting gratuities for their services. "I will tip when I go out to eat at restaurants. I will tip when I order food. But I won't tap and tend to turn it down when it's something that I already know that they're getting like a full wage for," explained consumer Garrett Bemiller. This sentiment reflects a growing skepticism towards tipping when workers are already receiving standard wages.

However, Ted Rossman, a senior industry analyst for Bankrate.com, suggests that inflation may also play a role in people's reluctance to tip generously. "I think inflation is leading people to be especially stingy about how much they're spending," he stated. Additionally, the abundance of tip prompts during checkout processes has prompted individuals to question the fundamental nature of tipping. Rossman emphasizes that tipping should be at the discretion of the consumer and is not always expected.

The declining trend in tipping raises concerns about the financial livelihood of service industry workers who rely heavily on gratuities. While some workers may benefit from increased tips during the holiday season, the overall decline points to a potential change in consumer behavior and attitudes towards tipping. As the debate continues, it is essential to consider the impact of these tipping practices on the livelihoods of service industry employees.

It remains to be seen how the tipping landscape will evolve amidst changing consumer sentiments and economic circumstances. As the data reflects, the decline in tips for some service industry workers is a significant concern for the industry and may require further exploration into fair compensation practices and the cultural perception of tipping.

The views expressed in this article do not reflect the opinion of ICARO, or any of its affiliates.

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