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Comment by nelsonic | Hacker News Reader

@junaru have you worked in the service industry? Are you suggesting that people who work in areas where tips are common should just be paid more by their employers?

100% Agree that people should just be paid more. But it's not that simple ...

Raising wages has an inflationary effect on the prices in the restaurants/bars. And the people who suffer from inflation are the minimum wage earners who spend proportionally more of their disposable income on essentials like groceries.

I worked as a waiter/bartender for 3 years in college and the wages were terrible! But I always made an effort and customers gave me tips. Saved those tips to buy my first iMac which I used to learn higher-paying skills.

Having been a service industry worker and now in a different income bracket I always tip for good service. Without tips many people in the service sector could not get by.

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> Without tips many people in the service sector could not get by.

I don't think that's necessarily true. In Japan tipping is a faux pas, and in fact restaurants will often return or refuse to accept them, yet the service sector is massive and the quality of service tends to be extraordinary. Much of Europe is similar, especially in eastern and southern parts. In China tipping is just not done...

How is it that they all get by, but the US service sector can't?

Indeed, people working in services in Japan people are paid significantly better than in the US/UK so tips aren't required. Also the culture is totally different and I prefer it that way too.

But using Japan as an example for this is like a red herring. The US/UK is not Japan. Just lookup "Cheating culture in Japan": https://www.reddit.com/r/japan/comments/5cnmy8/cheating_cult... would that work in US/UK? ¯\_(ツ)_/¯ (hint: no!)

> people working in services in Japan people are paid significantly better than in the US/UK

lol, no. They're paid less, on average.

https://www.erieri.com/salary/job/waiter-waitress/japan

https://www.talent.com/salary?job=waiter

At worst, it's comparable. You could make a complicated argument that costs of living in Japan are lower so on pseudo-PPP terms they're paid better, but this is by no means clear.

> Japan as an example for this is like a red herring. The US/UK is not Japan. Just lookup "Cheating culture in Japan"

The red herring is raising totally unrelated behavior from a Reddit post.

In truth, most of Asia's tipping culture is much like Japan's. China's 1.4B denizens don't tip. I'm in Croatia and nobody tips here, either. It's only expected of tourists.

And the OP is related to the UK where tipping is normal and often expected.

How is it going to have an inflationary effect when workers are already making that money? I don't really see how increasing menu prices or adding an automatic 12%-15% on the bill to avoid playing games afterwards with the receipt is a bad thing.

If costs rise, prices have to rise to maintain margins. Textbook definition of Inflation. If there's 15-20% (discretionary) added to the bill, it's not perceived as the price but rather as a "thank you" for taking care of us during our experience.

Again, I don't like this system; and would welcome a viable alternative!

Does it really make sense that 20% of the entire turnover of business shouldn't go through the business?

Is good service only available to those who tip?

Why are there so many hidden costs in American pricing? Why can't everything be upfront and honest and transparent?

Whose responsibility is the welfare of the staff?

Why do only waitstaff get the tips when the less-visible staff also contribute to good service?

> Raising wages has an inflationary effect on the prices in the restaurants/bars. And the people who suffer from inflation are the minimum wage earners who spend proportionally more of their disposable income on essentials like groceries.

I don't understand why you are conflating inflation of sit-down restaurant and bar prices (which doesn't affect poor people) and inflation of grocery prices (which does). You don't tip at checkout at a grocery store or a liquor store.

>Raising wages has an inflationary effect on the prices in the restaurants/bars

That implies consumers spend differently if they know the actual cost ahead of time, otherwise service inclusive pricing would make no difference. ie the whole industry is exploiting anchoring effects.

Removing anchoring effects would make restaurant businesses less profitable, and consequently the properties that host them less valuable, so lower rents.

There are clear incentives for pushing an inflation narrative.

How are tips immune from the inflationary effect you’re describing?

If a government mandates a higher wage or if 90% of a society voluntarily contributes tips, the effect is the same.

At the end of the day, the customer is likely paying an increased amount for a service being rendered. Except a mandatory wage increase may have the business reduce their margins while a tip puts the pressure directly on patrons.

I did tipped service work. It’s time to discourage general adoption.

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