Living

Everyone’s talking about “Tipflation,” here’s a breakdown

Are you feeling the pressure?

words by: Sahar Khraibani
Nov 7, 2022

We are all aware of how bad inflation has gotten, especially if you live in New York City. On top of prices skyrocketing, a new phenomenon has emerged. With the installation of touchscreens everywhere, and the pandemic exasperating employment scarcity, “tipflation” is on the rise.

 

Tipping is of course an incredibly important aspect of going out. You’re out at a restaurant: A server is bringing you your food, a barista is making coffee, and a bartender your drink. You have to partake in this exchange by paying a tip at the end of the meal.

 

But as of recent, merchants have been asking for tip after every purchase. I went to buy a pair of boots and when I was checking out I was prompted by the screen to pay a tip. I felt too embarrassed to say no, but paying a 20% tip for a $120 purchase in which the merchant was not involved in the process felt a little ridiculous to me.

 

It’s one thing to have to pay a tip for services provided, but it’s another when you’re not exactly sure what services you received that merited a tip. Recently, it seems to be expected to contribute a little extra everywhere you go, even for services that didn’t warrant a tip in the past.

 

Tips are typically collected using touchscreen tablets that many businesses use as their point of sale (POS) systems, whether it be at automatic car washes, for Botox treatments, or even for smoothie-making robots. These tablets and tip requests are now commonplace because of a mix of technology, societal pressure, and a pandemic that expedited the adoption of contactless forms of electronic payment methods. So now we pay more for services not rendered, regarding products that have already become more expensive than they used to be.

 

It is hard to pinpoint with numbers exactly how bad tipflation has gotten, mainly because there is no real research or data being conducted on it. What we do know is that in the United States, people have been expected to pay more and to tip more for a wider range of purchases and services.

 

So tipflation is exactly what it sounds like: An inflation in tipping. And it is becoming more common due to the use of technological payment models as well as an economy that has been hit hard by the pandemic. The purpose of tipping is to reward good service, but research has revealed that the vast majority of individuals are more driven by peer pressure. They are expected to tip, and they don’t want to break from a long-standing custom, especially if others are behind them in line and potentially passing judgment.

 

At the end of the day, with inflation being the worst its been in years, tipping falls on whether you are able to afford it or not. I believe that there are services that warrant a tip, and other purchases that don’t necessarily require it.

 

In other related reading, 4 ways to survive inflation in NYC and will current inflation impact student loans?