American incomes finally top pre-pandemic levels, fighting against inflation all the way

WASHINGTON (AP) — U.S. household income finally topped pre- pandemic levels last year, a stark sign of how the past five years of rising prices have limited Americans’ earnings and purchasing power.

Median U.S. household income rose a healthy 2.6% in 2025 from the previous year, after adjusting for inflation, to $87,460, the Census Bureau said Tuesday. That is a record high, topping 2019 household income of $85,320. The median is the level at which half of households had higher earnings and half had less.

The figures show that even after taking into account higher prices, the typical household now earns more than it did before the pandemic. But it’s a small gain over a six-year period, which helps explain the generally sour mood Americans have had about the economy since COVID-19 struck in early 2020. Concerns about affordability have taken a leading role in the fast-approaching midterm elections.

Household income has risen 2.5% since 2019, according to Census data. Yet over the previous six-year period, from 2013 to 2019, a period of very low inflation and declining unemployment, it jumped 19%.

The Census report also showed that women’s paychecks rose 3.2% last year, while men’s declined slightly. The solid gain for women narrowed the gender wage gap, though it remains large, with women earning nearly 84 cents for every dollar earned by men, up from less than 81 cents in 2024.

The Census report also showed that income inequality in the U.S. remained high last year, even as Americans at most levels saw their inflation-adjusted incomes grow.

Americans at the top 10% of incomes reported growth of 1.7% last year to $261,300, the report said, while the poorest one-tenth reported a slight decline to just over $20,000. As a result, the top one-tenth earn a bit more than 13 times the poorest households, up from 12.7 times in 2024. The record was 13.5 in 2021.

A household is defined by Census as a family unit or an individual living alone or living with people who aren’t relatives.

The agency includes all sources of cash income, including wages, investment income, and payments from government programs such as Social Security and unemployment insurance. It doesn’t include non-cash benefits, such as food aid — formerly known as food stamps — or Medicaid.

By demographic group, Asians reported the highest median incomes, at $126,300, a 1.6% increase from 2024. White households saw their incomes rise 2.9% to $96,710 while Hispanic households reported a 1.1% rise to $73,260. Black households saw the biggest increase, of 4.8%, to $59,980.