Chicago is set to raise the minimum wage for tipped workers to the rate for all workers – more than $15 an hour. The socialist mayor Brandon Johnson supports the idea because it ensures worker “equity.”
Really? This means tipping at restaurants and stores will be effectively eliminated. No more pay for performance. A surly or slow server at a restaurant will get paid the same as an attentive and friendly one.
What will this mean? Universally mediocre service. Under this pay system, excellence is punished and mediocrity is rewarded.
The Illinois Restaurant Association opposed the mayor’s plan, but with a gun at their head has agreed to a “compromise” five-year phase-in.
Washington, DC, California, Oregon, and Washington State have adopted some cristion on this policy.
Getting rid of tipping isn’t just bad for customers. It’s even worse for the actual workers.
A few years ago, one of the best economists around, Richard McKenzie, did a survey of restaurant workers, and here is what he found (edited):
I interviewed 40 servers in eight Orange County, CA “casual” table‐service restaurants. All interviewed servers scoffed, without hesitation, at the idea of giving up their tips for a “mere” $15 minimum wage. I then asked what minimum wage they would accept in exchange for giving up tips plus the then-$10 minimum wage. Their responses ranged from $18 to $50 an hour. That median translates to slightly more than $36 an hour today…