Millennials may kill tipping — and it could cost them their jobs

Millennials may kill tipping — and it could cost them their jobs

Debt-laden millennials who patronize the city’s bar and club scene are now officially among the worst tippers, according to a new study.

This is true even though many millennials work in the service industry and rely on tips.

“We’re seeing younger adults tipping less, and even showing a greater preference towards eliminating tipping altogether,” according to Matt Schulz, the senior analyst on the study by CreditCards.com.

As more apps like Uber don’t include tipping, many young adults feel the extra cash is better in their pockets.

At the same time, advocates are now pushing to abolish the New York “tip credit” that permits restaurant owners and bartenders to pay lower than the minimum wage because workers receive gratuities.

This could mean tips get scrapped altogether, and that could hurt already struggling young adults employed in the service industry. They could be kicked to the curb in a wave of mass closures and layoffs, according to industry analysts.

Eliminating the tip credit could also jack up payroll costs by an average of $14,000 annually for each full-time worker, according to a study by the New York Hospitality Alliance, based on the current tipped hourly minimum wage jumping from the present $8.65 to New York’s pending minimum of $15.

Forget about tipping under this expensive change. It won’t be outlawed, but many analysts think patrons will balk when it comes to today’s standard gratuities like 20 percent of the pretax bill.

Some establishments may discontinue the tipping custom, opting instead to pay workers a flat base salary, such as the minimum wage.

On top of this, millennials, ages 18 to 37, already tip less than the overall median — and 10 percent don’t tip at all, according to the CreditCards.com report.

“Many of our customers simply don’t have the disposable income to pay higher prices on food and drinks, which is how many establishments will respond if the tip credit is eliminated,” said David Mohally, owner of Bua, a gastropub in the East Village that employs 15 people. “Our customer base is 20-somethings — students, artists and young people — who’ve moved to New York for their first job. If we have to raise our prices to offset the change, we risk losing many of them.”

That sentiment is widely shared. “The city’s bars and restaurants employ a great number of millennials, where the average hourly wage is already $25 [including salary and tips] under the current system,” said Andrew Rigie, executive director of the New York City Hospitality Alliance.

If the tip credit is spiked, hourly payroll for a vast number of city establishments will have surged 200 percent since 2015.

“Imagine if your rent or grocery costs went up 200 percent,” said Rigie. “If the tip credit goes, so will many of the jobs held by millennials, because more establishments will close.”

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