The most generous tipping states despite inflation

Americans continue to tip big in restaurants even as the threat of high inflation looms over the economy.

According to aggregate restaurant sales data from software provider Toast’s Second Quarter Restaurant Trends Report, the average amount tipped at the same store increased nearly 10% from a year ago, despite the increase in the price of goods and services.

In the second quarter, quick-service restaurants saw an average tip of 16.9% and full-service restaurants saw an average tip of 19.6%. In-person diners tipped an average of 19.7%, while those with delivery or takeout tipped an average of 14.5%.

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TOST TOAST INC. 6:37 p.m. -0.48 -2.55%

As of June 30, Toast had approximately 68,000 restaurants on its platform.

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The data reveals that Indiana was the most generous state for tips during the second quarter with an average tip of 21%, followed by West Virginia (20.8%) and Ohio, Delaware and Kentucky (20.7% each).

Despite having one of the highest cash minimum wage laws in the nation for tipped employees, Californians tipped the least generously, giving an average of 17.5%. The other states with the least generous tips are Washington (18.3%), Florida and New York (18.5% each) and Hawaii, Texas and Nevada (18.8% each).

According to aggregate restaurant sales data from software provider Toast, the average same-store tip amount increased nearly 10% from a year ago, despite the increase in the price of goods and services. (iStock/iStock)

Earlier this month, the Labor Department reported that consumer prices increased 8.5% year over year in July, cooling slightly but still close to the highest level in 40 years. The cost of food outside the home rose 7.6% year over year in July, according to the Bureau of Labor Statistics.

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In the quarter, full-service restaurant sales returned to pre-pandemic levels, with gross merchandise volume up 18% on a like-for-like basis from the same period a year ago. Quick service restaurant sales are almost back to pre-pandemic levels, with same-store sales up 17% in the quarter from a year ago.

On-site restaurant sales were up nearly 22% in the quarter from a year ago, while takeout and delivery were up about 6% year-over-year .

Toast kitchen board

Chinese food saw the largest year-over-year sales increase in the second quarter at 23%, followed by Thai and European food at 15%. (Toast)

Chinese food saw the largest year-over-year sales increase in the second quarter at 23%, followed by Thai and European food at 15%. Coffee sales climbed 14%, while breakfast, bakery and Japanese food sales tied with 12% year-over-year increases. Italian cuisine rounded out the top performing kitchens with an 11% year-over-year increase in the second quarter.

Seattle, Boston and the New York metro area tied for best performing metro areas in the quarter with 24% year-over-year sales growth. San Francisco and Washington, DC rounded out the top five with comparable store sales growth of 20% year over year.

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