Southeast Missouri State University student publication

Beyond the Bill: The changes between generational tipping in the service industry

Wednesday, September 13, 2023

Whether it’s a restaurant, bar or coffee shop, tipping your server is not just seen as an act of appreciation; it is expected by the consumer.

In a survey done by Bankrate it is stated “Gen Zers are significantly less likely than Baby Boomers to always tip when they eat at a sit-down restaurant (35% compared to 83%).”

Southeast Missouri State University associate professor of management Steven Stovall said there are two extreme demographics in tipping culture, Gen Zers and Baby Boomers.

“That’s because there’s not a whole lot of discretionary money. I mean, you don’t have $20 to just drop and say, ‘Hey, thanks for a great evening,’” Stovall said. “The very elderly and then the 18 to 22, probably the Gen Zs [tend to tip less].”

Stovall agreed tipping at 15% - instead of 20% or above - could be a part of the Boomer’s routine.

In a survey sent within the Arrow newsletter, 115 people responded with a multitude of opinions regarding tipping. In the findings; 53% of the 18-25 age group tipped 20% or above with a total of 14% tipping 15% or lower in the same age range.

Ground-A-Bout manager Madison Francis said Boomers are not able to “swallow the pill” of tipping $4 or $5 at a coffee shop, since tipping $1 or $2 in the past was more acceptable.

In the Bankrate survey, a graph shows the tipping rate of U.S. adults has decreased 10% over the last two years.

“Two-thirds (66%) of the survey’s respondents have a negative view about tipping, including 41% saying they feel like businesses should pay their employees better rather than relying so much on tips,” according to the Bankrate survey.

Stovall owned Autin’s Casual Eatery and Bar in Wilmington, Ohio; which opened in 2016 and closed in January 2018. He said it would have been impossible to stay in business if he paid his servers minimum wage.

“We’re working at such micro levels of margins that I either would have had to cut back staff significantly, which then affected service or just close,” Stovall said.

Stovall said his servers were bringing home $300-$500 of tips on the weekends depending on the season.

Francis said the Ground-A-Bout aims to provide their employees with a comfortable wage so they do not have to depend on tips.

“We try to not let [wages] rely on tips in this situation in case they’re not getting tips, and then pass that, tips are hopefully additional compensation,” Francis said.

Not everyone uses tips as an additional compensation; people like senior public relations major Chloe Ray uses her tips to pay rent and other bills.

“We don’t get that minimum wage base. So all of our money does come from tips and I don’t know if some people don’t realize that or understand it,” Ray said. “If the server, bartenders are doing their job, I deeply believe that the base should be 20%, of course.”

A NPR article states, with the rise in inflation, restaurants and businesses have turned to relying on tips to keep their prices of food and services low and to ensure their employees get enough income to have a stable and enjoyable life.