How tipping in the US got out of hand

When was the last time you bought something and weren’t asked for a tip?

Not only are requests to tip on purchased goods and services increasingly common, but the amount of traditional tipping has also been on the rise for decades.

During the 1950s, people typically tipped 10% of the bill. By the 1970s and 1980s, that percentage had jumped to 15%.

In 2023, people will typically be anywhere from 15% to 25%. On average, consumers said they were over 21%, according to A Creditcards.com Scanned in May 2022.

“What we’re seeing now nationally is something known as ‘terminal inflation’… like “Lord of morals.”

The coronavirus pandemic has put more upward pressure on the coup. During the heyday of those days, consumers started buying things they didn’t have before to serve the industrial workers.

In February 2020, just before the pandemic began, in food and drink specifically, the share of remote transactions when tipping was 43.4%, according to Square. In February 2023, that share was 74.5%.

Meanwhile, if people are willing to give the person who delivers the food to their home 30% tip for the service, why not ask if they want to tip when they come to pick up the food? Restaurants began to do this more often – and the practice has not declined.

Another reason people are turning more is newer, cooler technology — kiosks and tablets with three big suggestions that pop up on the screen in front of you. Business owners usually choose these options, and they can also disable the feature if they want to.

Up to this point, 22% of respondents said that when offered different suggested tip amounts, they feel pressured to tip more than they normally would, according to Creditcards.com.

said Mike Lane, professor of consumer behavior and marketing at Cornell University’s Cornell College of Hotel Management.

The three prominent companies with a modern and elegant look are Square, Toast, and Clover. Enterprise was launched about a decade ago to help businesses run smarter, faster and easier.

In some cases, they charge lower fees, so accepting multiple credit cards isn’t as burdensome, don’t require long-term contracts, and offer many other useful tools including inventory and staff management.

“They’ve gotten credit card processing into the hands of very small individuals and merchants,” said Dave Koning, senior research analyst at Baird. He added, “Square did an amazing job… It’s been a massive growth story. That’s half of the business today.”

But, with customer inclination increasing, what is the tipping point?

“I have to believe the tips are going to go up from where they are today. But I also think there has to be a logical ceiling somewhere. I just don’t know where it is,” Lane said.

He watches the video above to find out more.