The Scourge of Tipflation

What do vape shops, self-serve frozen yogurt outlets, ticket counters at movie theaters, and merch tents at concerts have in common? You’re usually asked to add a tip for service.

Chances are a digital payment system will request a tip when you get your oil changed. Buying a gift card at a restaurant? Be prepared to tip. Some personal trainers even expect a little extra for their time. “This tip tsunami has clearly gotten out of hand as industries of all types are jumping on the tipping bandwagon.

A study by software payment company SpotOn found that the average tip across Washington state has increased by only 0.2% in the last six months to an average of 12.5%. Furthermore, fully one-third of restaurant workers across the United States, who depend on gratuities for anywhere from 25% to 75% of their income, report no change in their tips over the last year. 

A 2023 survey from Pew Research Center found that 72% of U.S. adults say tipping is expected in more places than it was five years ago, and two-thirds say they’re confused about whether to tip or how much to give. Tip jars are easy to ignore. Digital payment systems with gratuity amounts of up to 30% are not.

Tipping is generally thought to have originated in Europe centuries ago, but has a troubling history in America. Various sources across the internet date tipping in this country to the end of slavery, where employers encouraged people to tip to supplement low wages.

The SpotOn survey found that 44% of respondents wanted a default 10% option on digital payment systems. Though tipped workers in the restaurant industry, for instance, depend on that income for anywhere from 25% to 75% of their wages, it’s a precarious slope: Only one in four 18-to-24-year-olds say that fast-food restaurants and drive-thrus warrant tipping. Only 5% of those older than 65 feel the same way.

I once had a bartender friend who slipped me a free beer whenever I visited his establishment. Of course, that didn’t save me any money, because I felt I had to give him an even larger tip than normal. Most times, I came out on the short end of that. His employer eventually caught on and fired him.

Google “tipflation,” and hundreds of thousands of results show up. Businesses will only reconsider this practice if enough consumers resist excessive tipping prompts, awkward as that may seem.