Isn’t it strange how employers can make the decision to pay their workers less than we think they’re worth, employees can make the decision to take a job working for less than we think they’re worth, and yet the person feeling responsible for all these decisions is us?
On the other hand, it also gives the consumer more power over the wages of an employee than any other business. Do you think your fast food or retail employees are under paid? Teachers? Fire fighters? Too bad, you have almost 0 power to change that (and some of those positions have policies / legal prohibitions from accepting tips at all). But your local restaurant servers? If you think they're not paid enough, you have the direct ability to make a change on that front. Sure you probably still need to convince everyone else to do it too, but on the other hand, we can see that working in the fact that the "expected" tip rate has risen over time from ~10% to ~20%.
In fact, now that I think about it, since tips are a percentage of the bill, I wonder if tipped wages keep place with inflation better than retail?
Not to say that this is a great system overall, but I also find the mindset that's worried about tipped wages to be odd, because like I said, if you think they should get paid more that's entirely in your control. No one needs to wait for the boss to decide to hand out raises or make market adjustments. And most of my friends who worked tipped jobs weren't bothered by the tips per-se as they were with the times when work was slow. Sure they griped about stingy tippers, but none of them ever had a top complaint of "man I wish I could just make $8/ hour flat rate instead of getting tips"
It is end result of free market. Every side, consumer, buyer, seller, employer, employee and so on try to get away with paying least they can. This is usually by choice, not many actually combat this... The strange bit is how we have ended up in situation that there is some moral mandate that there is extra payment between consumer and employee. In all other parts system operates rationally. You pay what you have to get something. Be it the product or the labour. Paying more will have indirect benefits like better retention and maybe better quality(more effective or better selling staff).
On employee side, well there is usually not option to forgo work as money is needed for survival... So their only option is to take work that is less than they might think they are worth. But this often results in poor retention as they will move for better options when possible.
Arguably it's the result of a market failure. I don't know many people who enjoy tipping, in which case, I'd expect a free market would eventually produce some restaurants where you don't have to tip, even if it ends up being short-lived.
Instead, rather than see some businesses experiment with eliminating tips, I see a lot of businesses that haven't historically had tips start to request them. Worse, none of them as far as I can tell have lowered prices: it's just a new cost on top, much like bullshit fees tacked on by other industries, only with a new shame component built-in if you dare express frustration at having to pay it.
It's greedy exploitation stemming from the knowledge that the "free market" rarely exerts corrective pressures as well as advertised. The invisible hand is largely invisible because it isn't there.
Some restaurants have been experimenting with eliminating or reducing tipping.[1] But I agree that it's a difficult task for the "free market" to solve at scale.
>well there is usually not option to forgo work as money is needed for survival... So their only option is to take work that is less than they might think they are worth
Is this somehow bad? Everything is only "worth" as what people are willing to pay for it, and labor isn't any different.
