15%–25% in post-pandemic. Add to that the prices on the menu and checks, that the tips are based on have undergone significant increases in recent years. Workers are feeling it. When you hear that there is a worker shortage in the service industry some of the issue is that tipping is dying. Think about your local coffee shop. When we used cash, you always left the change. The need for speed has given us “the tap” which is preclusive to tipping. Employers skimming off the top really cuts into the “extra” that used to come to an employee working in the service sector.
This also impacts the growing demand for a raise in the minimum wage. Most service jobs were 60-70% salary and the rest in tips. That would account for the living wage. The salary is now up to 90%. Wages have not followed. That means less income for the worker. It also means less ability to pay for the customers.
I read an article recently in another publication that 80% of people now bypass the tip on at least one purchase a week. The number one reason is the transaction did not warrant tipping. This is the other problem emerging. Businesses that have no real reason to put a tip option on electronic payments are using it to generate more money. The movie theatre is one example. Adding ten percent tips to the inflated price of a movie soda and popcorn is a tough pill to swallow.
SPOTLIGHT MAGAZINE ON BUSINESS MAGAZINE • VOL 23 ISSUE 5 27
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