Americans Face Record-High Tipflation

Big Tippers

Tipping in the US is skyrocketing. Consumers today are being asked to tip more than ever before — and tipping more to boot.

In the 1950s, it was standard practice to tip 10% of the bill. That number has more than doubled, with consumers today routinely tipping about 21% on average, according to a May 2022 survey.

On top of that, the share of remote transactions that offer tipping has jumped from 43.4% in February 2020 to 74.5% just three years later. This means that more businesses are asking customers to tip after making a purchase.

Tipflation

This “tipflation” can be attributed in large part to COVID.

Tipping became a sign of solidarity during the pandemic, as stimulus-check-flush consumers generously compensated workers for showing up. But this signaled to businesses that many customers would leave a tip if they were prompted to. For that reason, the practice of asking for a tip has yet to recede — even as the pandemic has.

Tipping, like most things, is made easier by technology. Sleek checkout tablets offered by companies like Square (SQ) make it easy for businesses to ask for 15%, 20%, or more after any purchase — and easy for customers to add to their bill with the touch of a button.

Pressure Pushback

With these checkout tablets, businesses are also able to adjust the amount that customers are prompted to tip. For example, instead of listing tip options of 15%, 20%, and 25%, businesses can scale them upward to 20%, 25%, and 30%.

In doing so, companies can set their own tipping etiquette, pressuring shoppers to leave a higher tip than they’d prefer. According to one survey, 22% of people feel pressured to tip when prompted by a tablet than when they normally would.

As always, it’s important to practice polite tipping habits. But as tipflation intensifies, feel free to push back on pressure and draw a clear line when you’ve reached your tipping point.

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