Money Management
WalletHub Survey Highlights Consumer Sentiment on Tipping
The personal finance site WalletHub has shared the results of a survey it conducted asking consumers for their thoughts on the current state of tipping culture in the United States.
About the Survey Results:
Headlining the survey is this stat: 86% of respondents agreed that tipping has gotten out of control. Along with that, 55% said they believe businesses are using tips as a replacement for paying their employees higher salaries. Meanwhile, a slight majority (51%) admitted that they end up tipping more because of social pressure rather than rewarding deserving service. Nevertheless, 29% of those surveyed reported that they tip less when presented with a tip suggestion screen, compared to only 12% who said this leads them to tip more.
Asked about what type of system they’d prefer, four in ten said they’d replace tipping with an “instant employee rating” mechanism that would then let employers decide how much to pay workers. Elsewhere, respondents were overwhelmingly against automatic gratuity and service charges, with 83% saying they should be banned. Also, asked whether tips should be split among all employees or not, more than three-quarters of those surveyed said that only the workers who interacted with the customers should be recipients of the tips.
Lastly, 71% of respondents agreed that taxes should not be tipped.
What They’re Saying:
Commenting on the survey results, WalletHub editor John Kiernan said, “Most people want to be generous, but they don’t want to be nudged or forced into generosity at every turn, especially when gratuity was truly optional in the past.”
Kiernan added, “You also have to remember that money is tight for most of us, thanks to inflation, high debt levels and stock market volatility. Not having enough money to make ends meet puts a natural limit on people’s ability to tip, and excessive tip requests can feel like taunting. What people really want is for businesses to pay their own staff, rather than passing the buck to customers.”
My Thoughts:
It’s not a surprise that WalletHub would be conducting a survey on tipper culture during this period of time. Not only have tip suggestions become more prominent, but the standard for tipping has also seemingly increased over the years (anecdotally accelerating during the pandemic). On top of that, with President Trump’s suggestion that tips be exempt from tax, it appears as though such a policy would be quite popular. Then again, implementing such legislature would surely be difficult due to the number of loopholes that would exist.
Ultimately, while this survey shows what many already knew — that Americans are getting fed up with tipping culture — it’s hard to say how or when things might change. Personally, I’m open to hearing out new ideas and look forward to seeing what creative entrepreneurs might come up with to help fix this seemingly broken system.
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