True sign of the times: Vegas tips are slipping

Service workers report business is down, customers are less generous

Published Thu, May 8, 2008 (2 a.m.)

Updated Thu, May 8, 2008 (9:35 a.m.)

Sam Morris

Clockwise from top left: Magdolna Babics, co-owner of Kiss’s Salon & Spa; Al Maurice, blackjack dealer at the Mirage; Jompon Chotikamars, a bartender at Fitzgerald’s and Eric Johnson, a manager and bartender at Bilbo’s Bar and Grill.

Slipping Tips

You need to upgrade your Flash Player

Tropicana Entertainment makes money but still files for bankruptcy (5-5-2008)
Wynn Resorts first-quarter profit drops 20 percent (5-1-2008)
IRS tip: you made more, so you pay more (3-29-2007)

The economy, as you know, is off a couple of ticks.

First-quarter room occupancy is down 1 percentage point, Boyd Gaming’s Las Vegas revenue is down 5 percent or 6 percent, MGM Mirage’s profit is down a whopping 30 percent, and Stacy Taylor’s income is down 40 percent.

Taylor might be considered a barometer of the Las Vegas economy, as part of the 10 percent of the Las Vegas labor force that earns tip income. She’s a server at Smith & Wollensky, a tony Strip steakhouse that relies on conventiongoers. She’s seen her tips, which account for all of her take-home pay, drop precipitously because even though most people are tipping the same percentages, they’re not spending as much on food and booze.

Food tabs that were $150 a head are now less than $100 a head.

And that wine? If it’s a business dinner, it often goes on a separate tab so the alcohol doesn’t show up on an expense report — and some customers don’t leave tips on it, she says.

Taylor had counted on putting most of her tips in the bank to tide her and her family’s three children over through the lean summer months.

“I have nothing to put away this year,” Taylor says. “Picking up a second job might not be a bad idea, but I don’t know how I’ll manage to do it with three kids out of school for the summer.”

So that would be another expense: day care for the kids. Right now, with her working nights and her husband working days, they haven’t had to pay for day care. Someone is always home.

Versions of Taylor’s story are heard up and down the Strip and around town. At the Mirage, blackjack dealer Al Maurice says management is trying to spread the pain of fewer weekday gamblers by asking dealers to take extra days off — and sometimes forcing the issue. At the current pace, a dealer might make $3,500 less this year than last. So far he’s made $600 less. It’s not good, but he doesn’t think it compares with the drop the casino is seeing. So he understands.

Farther up the boulevard at the Stratosphere, valet Mark Cohen is seeing fewer cars during the week — he blames gas prices — and says tips are down a bit, to boot. He points out that there are more Europeans in town, what with the strength of the euro against the dollar.

And Europeans don’t tip?

“Well, you know,” Cohen says, “I don’t want to say anything, you know, bad.”

Make it down to Fremont Street and you might find Jompon Chotikamars tending bar at Fitzgerald’s. For him it hasn’t been bad, just a little bit slower during the week. “Tipping about the same,” he says, “but I’d say less people.”

If you head off-Strip for Bilbo’s Bar & Grill on Blue Diamond Road, manager and bartender Eric Johnson will tell you the locals are tipping the same percentages but business has dropped 10 percent. But stop by Zodie’s on Tropicana Road and Tommy Wise says the traffic is about the same and, while the regulars are being good, strangers are tipping about 30 percent less.

“My girlfriend is a waitress and she says business is off 30 percent there, too. She says it’s the worst it’s ever been and she’s been here 12 years.”

Want to grab lunch or dinner? Anthony Frederick hopes you do. He’s a server at both Tony Roma’s and Applebee’s. He figures lunch has gotten slower at Tony Roma’s; dinners are down at Applebee’s. A restaurant he used to work for, the Lone Star Steakhouse & Saloon on Decatur Boulevard, closed just after he left. He quit that job so he could move closer to work and save on gas. He says everything seems down about 30 percent.

Anxiety about the economy is contagious, he says.

“When I watch the news and get scared, I think everyone else is watching the news and getting scared and then they stay home,” he says. “That’s what I think.”

Julianna Nagy, who works at Kiss’s Salon & Spa on Tropicana Avenue, and Liz Guinan, who works at Gianna Christine Salon, Spa & Wellness in the District at Green Valley Ranch, say business is down 30 percent. Their analysis: Customers are putting off haircuts an extra couple of weeks and women are coloring their hair at home.

“The decent people, the average people, the people who make a good living and do right, they’re still coming,” Nagy says. “The housing (problem), that is what is really hurting us. The people who were buying big houses with lots of money, they don’t come.”

Her twin sister, Magdolna Babics, who owns Kiss’s with her, says a lot fewer people are buying luxury facials and waxings. So far, she says, the slacking off has not hurt her, “but I’m a pretty good person with the saving.”

Rudy Romero owns and serves at the Cuba Cafe on Tropicana Avenue (where you really want to order the ropa vieja or the shrimp in garlic sauce, or maybe just an entire meal of the strawberries flambee over ice cream). “It’s getting a little bad these days,” he says, “with the depression going on.”

And then there are the exceptions, the people who have it as good as ever or maybe even better.

Barbara Deck’s pet grooming business, the Barking Lot, also on Tropicana Avenue, just hired a new groomer and is going to hire another soon. Business is that good.

Pet owners, she says, budget for their animals’ care and grooming and keep their appointments.

“Pet owners are just different people,” Deck says. “That’s why I’m in this business.”

(Editor's note: This story has been corrected. An earlier version referred to MGM Mirage's revenue being down instead of its profits being down.)

Discussion: 19 comments so far…

By terjen

5/8/08 at 6:20 a.m.

Suggest removal

It is time for the "Give them $5.00 to keep them alive" campaign. The "older" generation is stuck on the $1 and $2 dollar tip, and that does not cut it. IF tips would rise with the cost of everything else the $5.00 is reasonable, so let us all support those who support us and Give Them FIVE ($5.00) to keep them ALive!!! PS: NO I do not work for tips, but I do leave $5.00 minimum, each time, everytime.
By mikeg

5/8/08 at 8:09 a.m.

Suggest removal

The Strip is half empty and they claim room rates are only down 1%? BS.

And did the article suggest that only 10% of the LV workforce earns tip income? Are you serious lol? More like 50%, when you think of all the waiters, bartenders, valets, dealers, bouncers, etc. Come on. That ten percent number is embarassingly off for this town.

And gas prices can't be helping. You see all the big trucks on the streets of LV that have to pay $80 every time they fill up, not surprising those people are going out less.
By MOZARTTURM

5/8/08 at 9 a.m.

Suggest removal

IT IS A SCANDALE, THAT WORKER MUST HAVE A TIP FOR SURVIVAL. THE CASINOS SHOULD PAY A TRUE MONEY AND DEMONSTRATE MORE SOCIAL ENGAGEMENT FOR HIS PEOPLE, HARD WORKING FOR THE MILLION SUCCESS OF THE BOSSES. We have NO understanding for this inhuman policy.

MOZART-TURM DEUTSCHLAND
We serve Mozart for the whole planet, ABSOLUTELY FREE
By GOD

5/8/08 at 10:45 a.m.

Suggest removal

Service has gone downhill in Vegas and I now go to places where I continue to get good/great service instead of places with marginal service with a 20% gratuity expected.

Listen up... if you're in an industry where tips are a large part of your income, make the customer feel special and you will be justly rewarded (not by everyone of course). An extra trip to a table, even a smile can go a long way to making the difference between good and great service.

TIPS = to insure prompt service.
By gqbossing

5/8/08 at 10:52 a.m.

Suggest removal

It's the business model of America to work for tips, don't give me any of this "moral garbage".

The economy is a cyclical thing, we are at the end of our cheap fossil fuel era and are transitioning over to another one. Look at the 80's when effeciency hit the wall; companies started investing in technology to change that and effeciency climbed double digits for over a decade and is still robust at over 5% a year.

People just need to quit complaining and retrain and change careers to make ends meet. Nothing lasts forever and if one doesn't change they become obsolete...
By MrCdnVegas

5/8/08 at 11:32 a.m.

Suggest removal

Well for one the US economy is not very good right now, so less people in town will equal less tip's based just on that fact.

Secondly for those of us that travel to Las Vegas I have seen a change that has effected how I tip.

I have been coming to Las Vegas 4-5 times a year for the last 5+ years. In that time the service has dropped and the prices have gone up.

I did not mind leaving a good tip for good service and reasonable prices. However the change in the last two - three years is a drink now costs $10-$12 at the bar, tipping $3-$4 at a slot machine per drink and only getting poor drink service, and no entertainment or dinners that don't cost at least $100 per person have taken over.

It's pretty hard for the average income Vegas tourist to pay ever rising flight costs,high prices for drinks, dinners and entertainment and still hope that they will leave a big tip.

At this point its not that the tourist will not tip, but because of the higher costs of going to Las Vegas, they will not only tip less but many are not even going period.
By CaptJack

5/8/08 at 4:56 p.m.

Suggest removal

Mike, 50% of the working population would be around 600,000 tipped workers. That's impossible.
By RPJ

5/8/08 at 6:18 p.m.

Suggest removal

Tipping is related to SERVICE, and most businesses forgot how to give good service during the flush Clinton years because they didn't have to, so they are suffering. Those who give good service will never suffer.
By nobody

5/8/08 at 8:27 p.m.

Suggest removal

After 18 years here in the hospitality business I can see the difference in attitudes from both the customer and the employee. Between the cost of the drinks now and the percentages set on the machines it is not enjoyable to go out anymore. Customers are getting squeezed and they hold the employee accountable because of "poor" service. You can always tell those who have never had to wait on anyone, they will always tell you how it should be. The corporations are trying to keep all of the money now, look at the paper payouts now, and they want to pay the employees less. Glad I am getting out of the business, not worth the hassle or the attitudes that are prevalent now.
By danman88

5/9/08 at 4:52 a.m.

Suggest removal

I'm in the casino business as a poker dealer for a major casino on the strip. The good news is that as the economy gets worse, the entertainment business gets better. This year has seen better rake and drop numbers than last year. On the other hand, I've seen a ten-fold increase in tourists from Britian, Australia, Canada, and other nations who are enjoying the strength of their dollar and the weak american dollar. Now some tip, others don't. But if I don't get tips, I make seven dollars an hour with an additional IRS flat tax rate of an additional 7 dollars an hour...in other words, can't make a living. Does this give me incentive to make the best dealing experience possible? You bet it does. I agree that bad service should translate into bad tips, but just remember that when you do get good service, reward it with good tips...otherwise, many in the service industry will have the attitude of why should it matter the level of service, I won't get tipped anyway. Personally, I always give a little something no matter how bad the service is, but if it's service above and beyond, I do give more.
By VegasBill

5/9/08 at 4:02 p.m.

Suggest removal

Living in Las Vegas has taught me a lot about being on the receiving end of good service. I travel North America extensively and run into bad service everywhere. I'm proud to tip when receiving good service. It's something I relish and I feel Taylor's pain. I have had to scale back on my eating out which means I have fewer opportunities to tip when receiving good service. Here's to a booming economy!
By brendanbuhler

5/9/08 at 4:20 p.m.

Suggest removal

MikeG:

Hi Mike. The 10% figure is my best guess based on the 2006 projections provided by the Nevada Dept. of Employment, Training and Rehabilitation. You can download an Excel file of their data here:

http://www.nevadaworkforce.com/?PAGEID=6...

(Download the file on the right side of the page, the one called, "Las Vegas 2004-2014 Long Term Occupational Projections-Color Coded Excel.")

Included in my tally are taxi drivers, chauffeurs, bellhops, concierges, tour guides and escorts, hairdressers, manicurists, gaming dealers, hosts and hostesses, bartenders, waiters, non-restaurant servers and massage therapists. Since there are categories like maids and housekeepers, entertainers and performers, and musicians and singers, categories which would seem to include some people who get tips but not be wholly made up of them, the 10% is kind of guess.

So, out of 966,055 estimated workers in 2006, somewhere between 80,540 and 102,175 were tip workers. Somewhere between eight and eleven percent, in other words.

(Not included in either the total or the guess are strippers, whose numbers I could not find an estimate for.)

Thanks,
Brendan
By vegasmisty

5/9/08 at 7:01 p.m.

Suggest removal

Just a personal observation but as of late, most casinos, if your a slot player, have really tightened up their machines or slowed comps but some more than others.
Once was a time when play time was prevalent but when you can go through several hundred dollars in a few hours and thats playing the penny and quarter machines, you know things are tight.

Recent trips to Jerry's Nugget is proof. We know that they had suffered a HUGE loss in monies by a ex-employee who manipulated jackpot reports and pocketed hundreds of thousand of dollars. Also although no report is out there on their management team, but it appears they have a new General Manager that has changed the comps, the promos and even the inside of Jerry's and not for the best. Even employees have been let go and they are now down to 1 cashier cage. So many changes usually means new Management and their ideas are not always in the best interest of the casino.

Many slot machines were taken out. Yes it gives more walking room in the casino proper but the players choices are very limited now and Jerry's was and still is a small casino in comparison to many others around it. Even the Cafe is not consistent on their quality of food or service lately.
The Poker/Bingo room which has been under construction for a year or more is still closed and asking workers there about it opening and no one has a clue on if and when it will happen.

This is a personal observation but because we have been frequenting Jerry's for years, changes this obvious are very noticeable to one who was a faithful player at Jerry's.

We know the economy is bad but when the casinos commit the ultimate sin by making the frequent patron feel totally taken by not even giving play time, its the first sign that the casino will be either looking to sell or close in the near future. We know they are trying to re-coup their monies stolen but we had hoped it wouldnt have been on the backs of its faithful patrons.

With the economy as bad as it is, casinos are hurting BUT so are also the ones who keep their doors open....US.

The first thing most of the locals here cut back on in a struggling economy is going to the local casinos or eating out. Many here are either not going as frequently, not going at all or taking way less in monies for their few hours out. Those are not necessaties and can be omitted in a heartbeat from everyday life.
Local casinos must realize that to keep those patrons coming in and helping that casinos bottom line is to at least give them play time or they will not return.
By tward40

5/9/08 at 8:22 p.m.

Suggest removal

Times are definitely hard and unfortunately those who make their living through tips are the first to feel it. I am planning on coming to Vegas next month only because I received free tickets to see Elton John, a free room at Harrahs and was able to use some of my frequent flyer miles. If that wasn't available to me, I would not come at all this year. Last year I visited Vegas 4 times. I noticed Harrahs has downgraded their player comps and, as a result, I will only come to Vegas once this year. I am certainly not going to be giving $5 tips unless the service is exceptional. Sorry but if the sad economy is affecting my pocketbook it will also affect those who receive tips from me. Don't get me wrong, if I am provided a service I will tip but not as much as I used to.
By tward40

5/9/08 at 8:28 p.m.

Suggest removal

One more comment. Maybe the upscale, wealthy players that Vegas seems to be catering to can keep Vegas profits from tumbling.
By Lenny_V

5/9/08 at 8:40 p.m.

Suggest removal

There's alot of cheap a-holes out there. They're multiplying by the day. You know who you are scumbags
By Melinda

5/14/08 at 9:59 p.m.

Suggest removal

I give 20% if service is good. BUT, $100 tip to hostess to walk me to my table at LAX, N E V E R..... I have my limits.
By jussnoyes

5/27/08 at 9:46 a.m.

Suggest removal

I can't beleive that the people that work for tips think we are just automaticlly give you money. Oh here's 5 bucks for holding the door. Or heres 5 for getting me a cab thats waiting in line for customers anyway. Why should I gamble at your casino when I get a "free drink" but now it's expected I tip $5.00 for the drink? You got to be kidding me. I'm loosing at the machines and I still have to tip you $5.00 for every drink you bring me? So if I have 5 drinks you pocket $25.00 That is way to much.I'm I the only one your bring drinks to? When you go out and gamble do you tip $5.00 per drink every time? The problem with Vegas is GREED. I used to come and play 3 or 4 time a year. The last 2 times I was in vegas all I did was loose. It didn't matter what I played.
I guess it just could be just bad luck but I don't think so I beleive it's GREED. Big companies own most of the strip. I will be in town late june and if things are still bad like overpriced drinks, bad attitudes, no playing time I will not come back. Because sadly Vegas has turned into a corporate cash cow and I don't like being milked...