Workers across a growing number of industries have become more dependent on tips — as have their employers. Shops and services have continued to encourage tipping since the pandemic, when gratuities increased for frontline workers, because of the tight labor market and rising costs that they face. Yet, shifting the burden of compensation to customers may have a limit. A recent Bankrate survey shows the proportion of Americans who tip is declining, while 41% say businesses should raise worker pay instead of putting out a hand. Tips increase service workers’ pay by 25% now, compared to 20% in 2020, payrolls firm Gusto reports.
- The number of small businesses asking customers to leave a tip at checkout has almost tripled since 2019, according to a survey conducted for The Wall Street Journal.
By Cate Chapman, Editor at LinkedIn News
Survey: 66% of Americans have a negative view of tipping
There’s no definitive guidebook on tipping in America, and it’s unlikely two people will tip the exact same way. The only thing most Americans may agree with is that they dislike some aspect of tipping, according to a new Bankrate survey.
Roughly two in three (66 percent) U.S. adults have a negative view about tipping, according to the survey. Americans said they believe businesses should pay employees better rather than relying so much on tips (41 percent), they’re annoyed about pre-entered tip screens (32 percent), they feel that tipping culture has gotten out of control (30 percent), they’re confused about who and how much to tip (15 percent), and they would be willing to pay higher prices if we could do away with tipping (16 percent).
Few topics elicit as many passionate opinions as tipping. There’s so much confusion regarding who to tip, and if so, how much. A lot is changing, as technology makes it easier to tip some people and harder to tip others – as travelers who are short on cash can attest.— TED ROSSMAN, BANKRATE SENIOR INDUSTRY ANALYST
Despite annoyances, people haven’t stopped tipping for everyday services. More than two-fifths (44 percent) of U.S. adults who dine at sit-down restaurants typically tip at least 20 percent. But when it comes to many tipped services, such as hair stylists, food delivery, taxis and more, everyone approaches tipping differently. Here’s how people feel about tipping in 2023.
Bankrate’s key tipping insights
- Waitstaff receive tips most frequently, but fewer people tip every year. 65% of U.S. adults who dine at sit-down restaurants always tip their server, making it the service that Americans are most likely to always tip. But that figure is down year-over-year: 73% of U.S. adults who dine at sit-down restaurants always tipped in 2022, compared to 75% in 2021 and 77% in 2019.
- Home repair workers receive tips the least frequently. 10% of U.S. adults who have home services or repair people always tip the workers, making it the service that Americans are least likely to always tip. That’s down from 2022, when 12% of people who used home services or repair people always tipped.
- Women tend to tip more frequently. Women more frequently tip for most services. Most significantly, 60% of women who see a hair stylist always tip, compared to 46% of men.
- The tendency to tip increases with age. Baby boomers (ages 59-77) tip the most frequently of any generation for most services, such as the 70% of baby boomers who always tip when they go to a hairdresser, hair stylist or barber. Only 24% of Gen Zers (ages 18-26), 40% of millennials (ages 27-42) and 67% of Gen X (ages 43-58) always tip their hairdresser, hair stylist or barber, in comparison.
- People commonly just want businesses to pay more. 41% of all U.S. adults feel businesses should pay their employees better, rather than relying on customers tipping workers.
Gen Zers and men tip the least of any demographic
The frequency of U.S. adults tipping has declined steadily since 2019, according to Bankrate. In 2023, fewer people say they always tip workers in every category:
Source: CreditCards.com survey, June 16-18, 2021; CreditCards.com survey, May 11-13, 2022; Bankrate survey, May 3-5, 2023
People who dine at sit-down restaurants say they always tip their servers —more frequently than those who use any other kind of service — but that percentage of people fell from 73 percent in 2022 to 65 percent in 2023. Over three-fourths (77 percent) of people who dine at sit-down restaurants always tipped their server in 2019. Similar trends are true for food delivery workers, taxi or rideshare drivers and other tipped services.
Most significantly, the percentage of people who always tip their hair stylists, hairdresser or barber fell from 66 percent in 2022 to 53 percent in 2023.
Nearly two in three diners always tip their waiters at sit-down restaurants
Servers and waitstaff at sit-down restaurants are most likely (65 percent) to always receive a tip from customers of any tipped service, followed by hair stylists. Additionally, 50 percent of those who use food delivery services, such as meals from restaurants or groceries delivered through apps like Uber Eats and DoorDash, will always tip:
People who use home services or repair, who pick up takeout food and who receive furniture or appliance delivery are the least likely to say they always tip: One in ten (10 percent) of those who use home services or repair always tip, as well as 17 percent of those who receive furniture or appliance delivery and 13 percent of those who pick up takeout food.
The tendency to tip differs widely between demographics like age, gender and location. Generally, men are less likely to always tip than women are. Most significantly, 60 percent of women who go to a hair stylist always tip, compared to 46 percent of men. Men also tip waiters, food delivery workers and other categories less frequently than women:
- Waiters at sit-down restaurants: 70% of women, 60% of men
- Hair stylists/barbers: 60% of women, 46% of men
- Food delivery workers: 54% of women, 45% of men
- Taxi/rideshare drivers: 45% of women, 36% of men
The tendency to always tip for a service increases as people age. Gen Z is generally the least likely to always tip for a service, while baby boomers are generally the most likely.
The difference between generations is largest for those who go to hairdressers, hair stylists or barbers. Only 24 percent of Gen Z who go to hair stylists always tip, while nearly three times as many baby boomers (70 percent) who use the service always tip.
Additionally, Gen Zers are significantly less likely than baby boomers to always tip when they eat at a sit-down restaurant (35 percent compared to 83 percent), get food delivery (31 percent compared to 62 percent) or use taxis or rideshares (22 percent compared to 56 percent).
The only exception in generational trends is for home services or repairs. Gen Z is actually the most likely (15 percent) to always tip for home service or repairs, a tendency that decreases in every generation. Only 6 percent of baby boomers who use home services or repairs always tip.
Midwesterners are 16 percentage points more likely to always tip at a sit-down restaurant than Southerners or Westerners
The Midwestern stereotype of “Minnesota nice” also applies to their tipping habits. Midwesterners are more likely to always tip for several services than people in other regions.
Most significantly, 77 percent of Midwesterners who dine at sit-down restaurants always tip, compared to 67 percent of Northeasterners and 61 percent of both Southerners and Westerners:
Percentage who use the service and say they always tip
| Region | Hairdressers, hair stylists or barbers | Coffee shop baristas | Servers or waitstaff at sit-down restaurant | Food delivery workers | When picking up takeout food | Taxi/rideshare drivers | Home service/repair workers |
|---|---|---|---|---|---|---|---|
| Source: Bankrate survey, May 3-5, 2023 | |||||||
| Northeast | 59% | 24% | 67% | 56% | 15% | 44% | 14% |
| Midwest | 61% | 21% | 77% | 57% | 9% | 41% | 6% |
| South | 48% | 22% | 61% | 45% | 14% | 37% | 9% |
| West | 50% | 20% | 61% | 47% | 16% | 42% | 12% |
However, Northeasterners say they are likely to always tip in two out of the nine total categories. Over one in three (35 percent) of Northeasterners who use hotel housekeeping always tip, compared to 23 percent of Westerners, 20 percent of Southerners and 19 percent of Midwesterners.
Similarly, 25 percent of Northeasterners who use furniture and appliance delivery always tip, compared to 18 percent of Westerners, 16 percent of Southerners and 10 percent of Midwesterners.
Nearly 1 in 3 Americans think tipping culture has gotten out of control
Americans can be quite confused about when and how much to tip in 2023. Though more businesses, like coffee shops and food trucks, encourage tipping during payment, not everyone likes being encouraged to tip, especially if the suggestions are a high amount. Around one in three (30 percent) U.S. adults told Bankrate they think tipping culture has gotten out of control. Older Americans tend to think tipping culture has gotten out of control more frequently than younger generations:
- Gen Z: 22 percent
- Millennials: 27 percent
- Gen X: 33 percent
- Baby boomers: 33 percent
Tipped workers receive a federal minimum wage of $2.13 per hour, according to the U.S. Department of Labor, amid the expectation they’ll make a higher income through tipping. According to Bankrate, two in five (41 percent) U.S. adults feel businesses should pay their employees better rather than relying so much on tips, the most common negative feeling about tipping.
In total, 66 percent of people had at least one negative feeling about tipping. Only 7 percent of people didn’t agree with any statement on tipping:
Source: Bankrate survey, May 3-5, 2023
Pre-entered tipping suggestions were the second-most common negative feeling for Americans. Nearly one in three (32 percent) of U.S. adults are annoyed by tip suggestions, and 18 percent said they tend to tip less, or not at all, when they’re presented with the screens. Only 9 percent say they tip more.
“Inflation and general economic unease seem to be making Americans stingier with their tipping habits, yet we’re confronted with more invitations to tip than ever,” Bankrate Senior Industry Analyst Ted Rossman said. “It’s a fascinating issue with few clear answers. There is one apparent certainty, though: Tipping doesn’t seem likely to leave American society anytime soon.”
16 percent of U.S. adults say they’re willing to pay higher prices if American culture could do away with tipping. Younger Americans are more likely to say they’re willing to pay more: 21 percent of millennials and 18 percent of Gen Zers compared to 13 percent of Gen Xers and 12 percent of baby boomers.
Other pain points include being confused about who and how much to tip (15 percent) and saying that they’re tipping less since COVID-19 (9 percent).
Not all Americans feel negatively about tipping -– many are still tipping well. Nearly one in two (44 percent) of U.S. adults who dine at sit-down restaurants say they typically tip at least 20 percent. Most commonly, 57 percent of baby boomers typically tip 20 percent, followed by 50 percent of Gen Xers, 34 percent of millennials and 25 percent of Gen Zers.
Tipping can be a positive emotion, too: 35 percent of U.S. adults say they feel good when they leave a generous tip. In contrast to those who have been tipping less since the pandemic, 14 percent of U.S. adults say they’re tipping more since COVID-19.
3 guidelines when deciding how much to tip
Tipping can be confusing; it may seem like the suggested guidelines are always changing. Because tipped workers rely on that money to pay their bills, Rossman suggests tipping 20 percent as a standard practice. But that can be tricky when you’re paying for inexpensive services, such as a coffee, or if you need to pay more than one worker. Here are a few tips to keep in mind:
- In personalized services, tip every worker who helps you. Are you at a hair salon, and two different workers cut and dye your hair? Or did you hire three workers to help you move? If you received individual, personalized service from several people, tip each person to thank them for their skilled work.
- Leave at least a small amount for inexpensive services. You probably don’t need to break out a calculator to figure out how to tip for a coffee. Generally, for services around $5 or less, leaving a dollar or your extra change in a tip jar will be plenty.
- Keep some cash on hand -– but you may need to pull up an app. Cash is best for some services like valet parking and hotel housekeeping, where tips typically aren’t suggested when you pay for the service. If you pay for a service that doesn’t allow you to tip at the end, ask the worker if you can tip them through a peer-to-peer payment platform like Venmo or Zelle. Some companies don’t allow their workers to receive tips, but it never hurts to ask.
Written By: Lane Gillespie Edited by: Tori Rubloff,
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