When I dealt blackjack in a Michigan casino I sometimes received hundreds of dollars in tips in less than an hour (but the tips were split by all the dealers).
When I worked in Florida as a tram driver, shuttling wealthy people from their condos to their private beachfront restaurants, I made about $2 total in tips in three months.
Obviously some jobs are better than others for getting tips. So if you’ve thought about getting a job where your winning smile and superior service can bring in the gratuities, consider your choice carefully.
Here are five factors that affect which tipped jobs will net you the most money:
- The type of employment
- The base wage
- The average size of transactions
- The number of customers per shift worked
- Specific factors related to the workplace
Let’s look at these one at a time in more detail…
1. Which Positions Are Best for Tips?
Although you can find occasional reports on the best tipped positions, the data is sketchy at best, probably in part because cash tips are often not reported to the IRS.
But it is safe to assume that bartenders usually make more than hotel housekeepers. Here are some of the jobs where you can expect to earn tips, with a few of the better ones in the top half of the list…
- Restaurant Server
- Casino Dealer
- Disc Jockey (DJ)
- Taxi Driver
- Limo Driver/Chauffeur
- Exotic Dancer
- Parking Valet
- Pizza Delivery Driver
- Cruise Steward
- Banquet Server
- Tour Guide
- Raft Guide
- Room Service Waiter
- Golf Caddy
- Massage Therapist
- Casino Shift Manager
- Mountain Guide
- Tour Guide
- Ski Instructor
- Diving Instructor
- Hotel Room Cleaner
- Tattoo Artist
- Dog Groomer
The job with the best tips may be exotic dancer, a career that can last longer than you might think. Data from PayScale suggests a median annual income that rises to $143,000 after 20 years on the job, and most of that is from tips.
Maybe, like myself, you don’t have what it takes to be an exotic dancer. Clearly, regardless of the tip potential of various jobs, that’s not the only thing that matters.
You have to consider your own experience and skills, as well as what you want to do and what’s available near you. Even if you choose a position which is known for high tip income, those tips can vary a lot according to the locale and employer.
For example, waiters at decent restaurants report making $20 and even $30 per hour, yet BLS statistics show the average wage for waiters and waitresses is just $9.25 per hour, which means half of all servers make less than that.
Looking for a job in a known high-tip-rate industry may be a good place to start, but you have to also consider other factors, like…
2. How High is the Base Wage?
What you actually take home is not just the tips you make but a combination of that and what your employer pays you. Your base wage can have a large impact on your total income.
You might be surprised to learn that the federal minimum wage for tipped positions is $2.13 per hour, and 18 states do not mandate a higher minimum.
Employers are supposed to make up the difference if employees don’t make the standard minimum wage between their base wage and tips, but sometimes employers don’t do even that.
So for better overall pay and more reliable pay, look for jobs that have a higher base wage. Ideally you want at least the full regular minimum wage and the opportunity to make tips. This is typical for pizza delivery jobs, for example.
My first pizza delivery job was in Michigan in 1985, and I averaged $8.60 per hour between my wage and tips.
A BLS inflation calculator says that’s the equivalent of $19.41 per hour in 2017, which is pretty good for a part-time job that can be learned quickly (but I suspect drivers are not doing as well today).
The minimum wage in 1985 was $3.35/hour, but I was paid $4.40/hour, which was more than half of my total income. That relatively high base wage really mattered when tips were down.
Your base wage is especially important if you’ll be starting out your new job working days and times when you won’t make much from tips.
For a higher base wage you could consider moving to a state with a higher minimum wage for tipped employees.
The U.S. Department of Labor’s state-by-state tip chart shows the minimum in Idaho is $3.35 per hour, but next door in Oregon or Washington it’s $9.75 and $11 per hour respectively.
Can’t move? Even where the minimum is $2.13 per hour many employers will pay more, so be sure to ask about your starting wage before you accept a job.
3. What’s the Size of the Average Sale?
In general tipping is done proportional to the size of the transaction. In other words, you’ll get bigger tips working at a restaurant with $50 meals than at one that has $6.99 specials. The difference was profound when I worked at a casino.
Dealing blackjack at a $25-limit table often brought in $50 in tips in a night, while working a $500-limit table could result in $1,000 in tips (casino tips are typically split between dealers in part to avoid arguments about who gets which table).
The most recent Zagat Survey shows the average tip at restaurants is now about 19%. Now, let’s say you’re an above-average waiter who is typically tipped 20% of the bill.
If you serve 10 tables in a shift, with an average bill of $30, and you make $60 in tips. Now make one change; work at a restaurant with an average bill of $100. Instead of $60 for the night, you can expect to make $200!
Ask any bartender who has worked in both a dive and a pricey club — the size of the transactions makes a huge difference. And what if you waited on 15 tables instead of 10? That brings us to the next question…
4. How High is the Customer Count?
This is a simple concept to understand; the more customers you serve the more tips you will collect. All else being equal, if you put twice as many people in your taxi each day you’ll double your tip income.
The lesson is clear; look for jobs at busy places. Of course, customer traffic may vary from morning to night (or middle of the night).
So before you take that job, be sure you know when you’ll be working. If you have to start out working slow times, ask how long it will be before you get to work the good shifts. And that brings us to the fifth factor…
5. What About This Particular Workplace?
Before you apply for a job, ask employees there about the work, the boss, and normal practices.
Will you have a shot at getting assigned to the prime shifts? Is there anything unique about the job that will help you earn tips? Are there advancement opportunities that will result in higher income (from tips, wages or both)?
For example, working where the rich and famous hang out might make for some nice surprises. Consider the $10,000 tip from Donald Trump that a waiter in Santa Monica received.
A place that charges $5 for an iced tea (it was the Buffalo Club) is bound to be good for tips, but the “celebrity factor” make oversized tips even more likely.
The same waiter received a $500 tip from Jerry Bruckheimer. In a report on other amazing tipping stories it’s noted that Johnny Depp has left tips as high as $4,000.
A high frequency of celebrity customers might be nice, but there are other employer peculiarities to consider.
For example, even though tram drivers made almost no tips at the high-end community where I worked in Florida, the guys who set up beach chairs and sun umbrellas for residents routinely made hundreds of dollars daily from tips.
It’s a mystery how this peculiar tipping culture developed, but it does suggest the importance of asking around about an employer and the various positions before applying for a job. I should have been on that beach!
Make sure you know how an employer handles tips. Many restaurants require wait staff to share a percentage of their tips with the bus staff.
I once worked at a pizza restaurant where we had to split any tip over $5 with the kitchen staff. Casino shft managers get a share of tips in some casinos, but nothing at the casino where I worked (which is why some went back to dealing after being promoted).
Then there are the places where tips are pooled. Ask about how they are shared. Will you split your tips just with the other employees on each shift, or are they pooled and split at the end of each week?
This can determine which shifts you want to aim for. You still want busy shifts if the tips are split at the end of the shift. If the tips are split among all employees weekly there is no need to work at the busiest times.
You can gather information about some employers, and how they handle tips, on Glassdoor.com. Just read through the employee reviews.
Talking to employees directly is always a good idea, but be wary of stories about one-time big tips or “that great Friday last year.”
In fact, be skeptical about employees’ estimated averages. In my experience, most employees have no idea how much they really make.
Ask employees about the worst days they’ve had for tips. If these are still pretty good you may have the right job. In any case, by asking about the bad days and the normal ones you can arrive at a better estimate of an average.
Getting Hired for the Good Jobs
Once you have considered the five factors above you might have a few good jobs in mind where you hope to make great tips. But what if you don’t have enough experience? You may have to take jobs that won’t be great for tips, but will lead to better positions.
For example, you might work as a hairdresser at a small shop just long enough to get that experience on your resume, and then apply at a high-end place where the tips will be three times as good.
It helps if the better positions are in the same company, so look for employers where advancement is possible. On the other hand, don’t bus tables just hoping you’ll get to be a waiter.
Ask your potential employer for a timeframe for advancement, assuming you do a good job — and then remind him when the time comes.
Finally, working your way into a good job making good tips is not the end of the matter. There are many strategies for increasing your tip income no matter where you work. Those will be covered in a future post.
If you enjoyed this article, you might also enjoy 15 ways to use a job to make more money. Have you worked for tips before? Tell us about your experiences below.