People think restaurants are rolling in money. The average full-service margin is 3 to 5 percent, and labor is already the biggest cost. Forcing every server onto a full base wage means raising menu prices 20 to 30 percent overnight, and customers who say they hate tipping will absolutely notice a $24 burger becoming $30. The National Restaurant Association's industry data consistently shows how thin these margins are. restaurant.org. What actually happens: owners cut staff, add QR-code ordering, and the server you wanted to help gets replaced by a kiosk. The tip credit is a compromise that keeps dining affordable and keeps humans employed. Kill it and you will get higher prices, fewer jobs, and the same workers earning less.
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