eli5 How did the US service industry become so reliant on consumer tips to function?
In: 5994
I don’t know why it started but I can tell you some of the reasons why it persists. One, restaurant owners can artificially make the prices of foods appear lower than they really are since you are subsidizing server wages out of tips. Two, servers would much prefer to be paid by tips at expensive restaurants because they often make hundreds of dollars a weekend night if they serve a lot of alcohol and wine to their customers. I used to work at fine dining seafood restaurant and I could make $300 on a busy night in a medium sized city. Most servers would not trade that for a $15 – $25 an hour job because they make more in tips. Lastly, the people who suffer the most are the dishwashers, line cooks, and back of house staff. They are not usually paid much hourly, only get a fraction of the total tips, and tend to be from communities who have less power, namely non-English speaking immigrants. I find the industry exploitative and unethical in this regard. You would think fellow workers would acknowledge this imbalance and fight for improvements, but they do not. Why would a 22 year old college student who makes at least $25+ an hour with tips or a bartender who makes even more take a guaranteed hourly wage without tips just so their coworkers could earn a living wage if they make a lot more when tips are part of the equation? They won’t.
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