Restaurants are raising wages enough to make up for poor tipping

Many servers are relying less on tips and more on rising wages as diners’ gratuities trail inflation — despite all the complaints about "tipflation."

Diners are pulling back on tipping, but waiters and table bussers are still coming out narrowly ahead.

From January 2020 to September this year, base wages — what staffers get paid directly by their bosses, before any tips — jumped 66%, according to findings released Tuesday by private-sector payroll processor ADP. Gratuities rose only 23%. The study analyzed the paychecks of nearly 100,000 tip earners at full-service restaurants nationwide.

Restaurant workers earned a median hourly pay of $23.88 from wages and tips combined as of September, up 28% since January 2020. Because consumer prices rose 22% during that same period, the data shows these workers’ overall income growth beat inflation by 6 percentage points — while their tips outpaced it by just 1.

A separate report released Tuesday by the payments processor Toast found tips at full-service restaurants have been roughly flat since June. They averaged $21.48 per hour as of September, only 58 cents more than the same time a year earlier — but about 7 cents less when adjusted for inflation.

Like many recent economic trends, restaurant workers’ pay gains are closely linked to the pandemic: Operators hiked wages to coax workers back as they reopened and found they generally couldn’t lower wages once they’d raised them, said Nela Richardson, ADP’s chief economist.

https://www.nbcnews.com/business/economy/tipping-restaurant-workers-minimum-wage-rcna183424

---