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Americans are worse tippers now than before the coronavirus pandemic: Survey

Yahoo Finance reporter Brooke DiPalma breaks down a new survey that found people are worse at tipping now than before COVID, and how inflation is playing a role.

Video Transcript

BRIAN CHEUNG: Americans' tipping habits have changed, according to a new survey from CreditCards.com. People are tipping less compared to pre-pandemic levels. Yahoo Finance's Brooke DiPalma here with the details. Brooke.

BROOKE DIPALMA: That's right. Americans are actually tipping less than compared to pre-pandemic levels. Now when you take a look, though, at 2021-- 2020 and 2021, it turns out that more than 1/3 of Americans pledged that they'd actually be better tippers. But now, of course, as inflation takes, really, front seat here for American households, it turns out that Americans are, in fact, tipping less and that that sentiment is ultimately gone.

So when you look at the number of Americans who say that they will always tip, at sit-down restaurants, it's 73% in 2022. Food delivery, 57%. Taxis and rideshares like Uber and Lyft, 43% of Americans say they will always tip. So food delivery and taxi and rideshares, that's the largest drop compared to 2019. Coffee shops, it now sits at 22% of Americans say they will always tip.

But when you take a look at some other service industry businesses, it's actually the same and/or higher. So at hotel housekeepers, it's the same. We're seeing so many Americans eager to travel once again. And then hairstylists, apparently, we all missed our hairstylist during the early months of the pandemic. People actually are more inclined to always tip, at 66%.

Now, this is really a combination of both inflation, as well as a short staff. So when you really think about it, inflation taking a front seat here for so many American households, it's taking a toll on their purchasing power. That's according to CreditCards.com analysts.

But in addition to that, people, or staff members, rather, are mostly unlikely able to provide those top notch experiences that we maybe were able to see back in 2019 when there was more people on the staff. There was a larger crew looking to help out. And so, really, now, Americans are taking that all into consideration when they're leaving that tip.

AKIKO FUJITA: I feel like there's more incentive to tip, right? When you've got a server, for example, at a restaurant that's short staffed, but--

BRIAN CHEUNG: They're doing more.

AKIKO FUJITA: Well, they're doing more, but that number that we just saw, I mean, does that mean some people are not tipping at all?

BROOKE DIPALMA: So that's actually funny you say that. So when you take a look at different generations, we're actually seeing that 40% of Gen Z and millennials are leaving nothing at all. That's a combined 43% of Gen Z and millennials. But when you take a larger look at those generations, you can see here, it turns out that boomers are tipping the least amounts. So this is the percentage of a bill that you're seeing.

So Gen Z, of course, the youngest generation here, they're leaving an average of 26% tip. Of course, that's on the higher end of the range. Millennials leaving 24%, Gen X leaving 20%, boomers leaving 19%. I'd say, on average, people, typically when I think of leaving a tip, between that 15% to 25% range. So Gen Z certainly looking higher.

But as we just noted, 43% combined of Gen Z and millennials, sometimes, considering leaving nothing at all. And it also depends on gender, Akiko and Brian. Apparently, we all tip a little different. When it comes to gender, men, on average, are leaving a 22%--

AKIKO FUJITA: Interesting.

BROOKE DIPALMA: --tip, whereas women are leaving 20%.

AKIKO FUJITA: I feel like women tip more with, like, stylists or-- you know, right?

BRIAN CHEUNG: That might be different depending on what--

BROOKE DIPALMA: You have a relationship with them.

AKIKO FUJITA: Exactly.

BRIAN CHEUNG: --type of category.

BROOKE DIPALMA: It's not like a random barista or a coffee.

BRIAN CHEUNG: Right, right.

BROOKE DIPALMA: But at the same time, there's a go-to coffee person for a lot of Americans out there. But with inflation and those other nuances in American households just costing more, people are maybe less generous when it comes to that extra money. Also, we've seen many restaurants implement those additional fees in recent months, as food and labor costs are higher. So people see those fees, and they might be leaving more-- leaving less, that is.

BRIAN CHEUNG: Yahoo Finance's Brooke DiPalma, thanks so much for the breakdown. That does it for us here on the 11:00 AM. We will see you same time, same place tomorrow. Have a good one.