Tipping might seem like a straightforward way to show appreciation and help workers make extra money, but there's a lot more to it than meets the eye.
For some, the act of tipping has become contentious. Many customers feel employers should pay adequate wages and not outsource that responsibility to customers.
Here are some surprising facts about tipping in the U.S. and around the globe.
Get instant access to hundreds of discounts
Over 50? Join AARP today— because if you’re not a member you could be missing out on huge perks like discounts on travel, dining, and even prescriptions.
Get 25% off membership — just $15 for your first year with auto-renewal — and a free gift if you join today.
Tipping dates back to the 1850s
/images/2024/07/22/man-of-the-nineteenth-century-adobe.jpg)
Tipping in America started in the 1850s as a custom imported by wealthy Americans who wanted to feel genteel and aristocratic.
The practice is rooted in a master-serf dynamic and provides a way for the upper classes to reward the lower classes for performing a (usually menial) task exceptionally well.
The practice caught on and became deeply ingrained over the years.
Tipping is tied to the legacy of slavery
/images/2023/12/08/woman-putting-tips-into-glass-jar.jpeg)
After the Civil War, newly freed former slaves often worked in service roles. This included jobs as restaurant servers, bellhops, and railroad porters.
Many employers didn't pay these workers, assuming that tips would make up their wages. This practice effectively perpetuated a form of economic exploitation many liken to slavery.
A class of people were paid to bow, scrape, and be subservient to a dominant, monied class.
Race played an uncomfortable role in tipping
/images/2024/07/22/professional-waiter-adobe.jpg)
The dynamics of tipping have always been racially fraught. Historically, employers justified low or sparse wages to Black workers by reasoning that tips would make up the difference.
This has resulted in a persistent disparity in earnings of those who work in the service industry versus other "stable-wage" jobs.
Resolve $10,000 or more of your debt
National Debt Relief could help you resolve your credit card debt with an affordable plan that works for you. Just tell them your situation, then find out your debt relief options.1 <p>Clients who are able to stay with the program and get all their debt settled realize approximate savings of 46% before fees, or 25% including our fees, over 12 to 48 months. All claims are based on enrolled debts. Not all debts are eligible for enrollment. Not all clients complete our program for various reasons, including their ability to save sufficient funds. Estimates based on prior results, which will vary based on specific circumstances. We do not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Not available in all states. Please contact a tax professional to discuss tax consequences of settlement. Please consult with a bankruptcy attorney for more information on bankruptcy. Depending on your state, we may be available to recommend a local tax professional and/or bankruptcy attorney. Read and understand all program materials prior to enrollment, including potential adverse impact on credit rating.</p>
Sign up for a free debt assessment here.
Tipping was initially unpopular
/images/2023/12/28/female-waiter-dissatisfied-with-tip.jpeg)
While nouveau riche Americans took to tipping like ducks to water, it was initially unpopular with the masses.
Many people found tipping to be undemocratic and unAmerican. In the early 1900s, many states passed laws to abolish tipping, which they viewed as a form of bribery, extortion, and exploitation of workers.
These laws, however, were short-lived and eventually overturned.
Modern tipping began with the New Deal
/images/2024/07/22/franklin-delano-roosevelt-memorial-adobe.jpg)
Tipping as we know it today became solidified during President Franklin D. Roosevelt's New Deal era.
Amid hard times, legislation allowed employers to pay commonly tipped workers less than federal minimum wage, as long as employers paid workers the difference if tips fell short of hourly minimum wage.
Nearly a century after the Great Depression, this system has persisted. The federal minimum wage for tipped workers is $2.13 an hour.
Trending Stories
Women are more likely to work in jobs that depend on tips
/images/2023/12/08/beautiful-waitress-receiving-tip-from-client.jpeg)
Two-thirds of tipped workers are women, which may contribute to the gender pay gap. Some believe that the practice of tipping shows the diminished value America has placed on women and people of color over the past 150 years.
Dominating a tip-dependent profession places women in an economically vulnerable position, including situations where they may be expected to tolerate inappropriate behavior to secure better pay.
Not all countries tip
/images/2024/07/22/female-waitress-smiling-adobe.jpg)
Tipping is commonplace in the U.S., but that's not true in other parts of the world. Countries such as Switzerland and Japan do not have a tipping culture.
In Japan, tipping is not proper. Servers are known for providing exceptional service to all customers without gratuity or service charges as an added incentive.
In cultures where tipping is not the norm, service charges like server pay are included in the bill.
Political views might impact your outlook on tipping
/images/2024/07/22/tips-and-receipt-on-table-adobe.jpg)
Republicans tip workers more often and at higher rates than do independents and Democrats, according to a CreditCards.coms survey.
Nearly two-thirds — 59% — of Republicans regularly tip more than 15%, followed by 56% of independents and 46% of Democrats.
Gender also might impact how you tip
/images/2024/05/29/delivery-man-receiving-tips-from-woman.jpeg)
Like politics, gender also plays a role too. Women generally tip more generously than men and leave a higher percentage of gratuity on their restaurant bill.
Women leave a median tip of 20%, according to CreditCards.com. That compares to just 16% for men.
Earn cash back on everyday purchases with a debit card
Want to earn cash back on your everyday purchases without using a credit card? With the Discover® Cashback Debit account (member FDIC), you can earn 1% cash back on up to $3,000 in debit card purchases each month!2 <p>See website for details.</p>
Don’t leave money on the table — it only takes minutes to apply and it won’t impact your credit score.
Learn more about the Discover Cashback Checking account
Age plays a role in tip size
/images/2024/05/06/hotel-bell-boy-servicing-guest.jpg)
Baby boomers are the best tippers and millennials are the worst. More than half of seniors regularly tip 20% or more at restaurants, according to CreditCards.com.
On the other hand, younger generations are more likely to not "believe" in tipping culture. A full 34% of millennials want tipping to become obsolete, according to a Civic Science survey.
Perhaps as a result, 59% of millennials admit to regularly leaving tips of 3% or less.
Servers and hairstylists get the best tips
/images/2024/07/22/keeping-cash-money-tips-adobe.jpg)
Servers and hairstylists consistently earn the best gratuities in tip-based occupations. They average tips of around 16% and 13%, respectively, according to a Discover survey.
Takeout cashiers and casino dealers get the lowest tips
/images/2024/07/22/croupier-holds-poker-cards-adobe.jpg)
Tips for takeout cashiers and casino dealers average 4% to 6%, respectively, according to Discover.
With takeout, the role requires less personal interaction. Additionally, a customer is already choosing to pick up their order to avoid paying delivery charges and a driver tip.
Casino dealers may have more interaction with customers, but those losing money at the gambling table are less likely to tip. Luckier players may offer a small gratuity from their winnings.
Is 'tipflation' getting out of hand?
/images/2024/06/28/worker-accepting-of-cash-payment-adobe.jpg)
The rise of digital payment systems has led to "tipflation," where customers are prompted to tip for a wide range of services that never required tipping before, from picking up dishwasher soap at the store to picking apples at the apple orchard.
Whether or not tipping is out of hand is a personal call. Your feelings on the subject are likely tied to your age, gender, income, and occupation. But being prompted to leave tips all of the time can be confusing and downright irritating.
Bottom line
/images/2023/01/13/waiter_counting_money_that_he_earned_for_the_working_day.jpg)
Tipping has a long history in the U.S., but it has become more controversial in recent years. Each person has to decide how they feel about this practice and to tip accordingly.
Remember that tipping helps many workers get ahead financially. So, think long and hard about tipping practices and make the decision that is right for you and the person serving you.
Up To 5% Cash Back
Discover it® Cash Back
Current Offer
Discover will match all the cash back you’ve earned at the end of your first year.
Annual Fee
$0
Rewards Rate
Earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases.
Benefits
- $0 annual fee
- Intro APR on purchases and balance transfers
Drawbacks
- Requires you to activate the highest-earning category each quarter
- Not accepted as widely overseas as Visa or Mastercard
- INTRO OFFER: Unlimited Cashback Match for all new cardmembers–only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300.
- Earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases.
- Redeem your rewards for cash at any time.
- Apply and you could get a decision in as little as 60 seconds. No annual fee.
- Start shopping and earning rewards in minutes with your digital card, before your physical card arrives in the mail, if eligible.
- Get a 0% intro APR for 15 months on purchases. Then 18.24% to 27.24% Standard Variable Purchase APR applies, based on credit worthiness.
- Terms and conditions apply.
Subscribe Today
Learn how to make an extra $200
Get vetted side hustles and proven ways to earn extra cash sent to your inbox.