I may have posed my point poorly. Here's the short-and-dull version.
1. Restaranteurs benefit from the tipping system - it allows them to reduce overhead on slow days, incentivise employees, and shift the burden of compensation to those who will pay the most. It's a very good system.
2. In return for the increased risk, employees can profit very heavily. Those at the top are compensated very well.
3. For the customer who actually tips, there's a significantly higher final price combined with service dependent on how nice you dress.
4. Waiters can get screwed severely by a kitchen screw-up, or will profit off a restaurant's success. This hurts waiters at poor restaurants, but can be very rewarding for those at the top (As above.)
5: It's more profitable for the restauranteur to pad the price of big-ticket items than to add a flat fee across the menu for service. As such, you'd be paying a percentage of your tab anyway.
Sales jobs are often much the same way. Paying your employees entirely on comissions is easy, but it can mean that smaller customers can get awfully screwed, and the risk requires higher average compensation.
It's a matter of choice, EdwardJ. We are not living in Medieval times when one was destined by birth to work in a particular trade.
A friend currently lives in the middle of nowhere. She's dyslexic, so she figured she'd try being a waitress for a while. Live the american dream and all that.
Problem is, she's making ~$600/month during the slow season. You can live in the middle of northern Wisconsin on $600 a month, but god forbid you leave. $600/month in Madison, WI buys you a walk-in closet.
Incidentally, god forbid you have to go to the hospital for food poisoning and rack up an enormous bill. (The restaurant in question - not her employer - won't pay; I suspect we can't prove it was food poisoning, even though two other people ended up in the hospital that evening from the same place.)
She's been trying to leave for months. I doubt she ever will. Adam Smith's "perfect market" is about as realistic as carnivores embracing Tofurkey.
Cooking and being a waiter are two completely different skill sets. Of course there is going to be income inequality.
Your "of course" confuses me. Why of course? How is the dollar value of a particular skill set determined?
By market forces. In this case, market forces have zero correlation with anything other than the restaurant industry's convenience. I once recall the head dessert chef at WD-50 having bargained his way up to a little over $60,000 a year. I know artists from Wisconsin who do better than that selling jewelry at art fairs.
Whoa, hold on there! America never had an apprenticeship system, but more importantly there is no standard or benchmark for cooks in the U.S. "The industry" evolved around immigrants who couln't get hired into well paying jobs and instead opened up a restaurant, laundry, or other small business--and still does to this very day. But I digress, How can you have an apprenticeship and not have a standardized qualification?
It's rather curious that you say that. I had some university classes at a tech school that trains both chefs and electricians. The latter had a more formal process of apprenticeship, but both made it pretty clear that you'd be starting on the bottom and learning on the job.
There's no formal standard for chefs because the quality of their work is apparent to the untrained. I don't actually know that much about structural grounding, but I don't care if a chef's a three-eyed Venusian if he never botches an order during the Friday night rush.
I would have to guess that the price of meals is higher if there's no tipping and the restaurateur has to pay the wait staff more per hour. The question is; is the combined total larger of smaller than a meal + tip situation.
Yesterday we had lunch at a nice local restaurant. The fixed price lunch (2 courses plus cheese & dessert) was 14.50€ ($19.00) This was for the meal and included service
Is this in France? If so, the price is much lower. If you index cost of living by things that are a little bit higher (rent, though this may no longer be the case) and things that are a lot higher (automobiles, where this is DEFINITELY the case), France's cost of living is definitely higher. It certainly isn't less.
I can't make a direct comparison, but $16 in Wisconsin will buy you a bowl of soup ($3.50), a BBQ sandwich ($9), and pie ($4.50.) No cheese plate. Soda $2. I don't know what the difference is, but $16 is definitely a deal.
Sure -- how exactly do you expect this to change? It would be GREAT to have the kind of apprenticeship programs they have in Europe. But do you seriously think ANYTHING is going to change here? Not when for-profit "universities" can fleece the unknowing out of so much money. (I have co-workers with high five-figure debt. .)
Congratulations! You've just isolated why quite a lot of formal economics is bollocks when applied to anything other than commodities. The actual valuation of a culinary arts program is much lower than the perceived valuation, and the vast oversupply is pushing wages down. It's like the housing bubble, if people were still buying houses.
But I know my history -- organized labor has largely been a force of good. Kids now go to school, not to work. We have weekends, and a 40-hour week. Overtime is an accepted part of the US employment experience.
They also ate Detroit, and increased the magnitude of the Great Depression (the old one.) In theory, a unions gives a supply-side monopoly to labor suppliers ("people") to balance out a demand-side monopoly of labor consumers ("employers.") In reality, they can warp the market just as badly as any other monopoly, and senority within the union often results in preferential treatment.
Your union seems to have created a situation that is stable and profitable for all parties involved, and I applaud them for it. But you've also got the UAW scalping new hires so that older employees don't lose benefits from the bankrupt companies they work for. The word "Union" has a lot of baggage.
Edited by jrshaul, 12 January 2013 - 01:25 AM.