The Tipping Point: Wage Spikes, Menu Prices and the New Restaurant Economy

From blog.ice.edu, by Institute of Culinary Education
The Tipping Point: Wage Spikes, Menu Prices and the New Restaurant Economy

 

By Steve Zagor—Dean, Business & Management Studies

 

As Minimum Wages Rise, Restaurants Say No to Tips, Yes to Higher Prices,” reads the New York Times headline. I experienced this seismic change firsthand on a trip to St. Louis. My son and I stopped for an impromptu lunch at a very modest neighborhood café (see: worn upholstery, paper menus and general shabby charm). Only two other tables were occupied during prime lunch service, and one look at the extravagant menu prices had me wondering if we were in for a taste of highway robbery.

[caption id="attachment_19955" align="aligncenter" width="550"]tipping Photo Credit: Lea Latumahina[/caption]

I ran down my typical checklist. Was the restaurant an alum of Diners, Drive-Ins and Dives? Was it a farm-to-table, locally sourced, organic, natural, gluten-free, green, Slow Foods-endorsed, celebrity chef-fueled find? Nope. None of the above. Discomfort swelled inside me like a cheese soufflé rising in a too-small cup. Finally, I saw a small note between the burger of the day and the Caesar salad stating, “all prices include basic gratuity.

 

Read on to learn how wage increases are changing the rules for restaurateurs.