Household income hits record, but lower earners lose ground

Data: U.S. Census Bureau, Current Population Survey, 1968 to 2026 Annual Social and Economic Supplements; Note: Census identifies breaks in the series in 2013 and 2017 due to methodological changes; Chart: Russell Contreras/Axios U.S. household income hit a record in 2025, but the lowest earners barely shared in the gains, new Census data show. Why it matters: On paper, Americans look richer than ever. But broader measures of financial security show millions still getting squeezed by medical costs, uneven income gains and a thinning public safety net. The 2025 Census report largely captures the economy before the major safety-net reductions in President Trump's "Big Beautiful Bill" took hold. That makes this year's record income and near-record-low official poverty numbers an important benchmark for measuring what happens next. By the numbers: Real median household income rose 2.6% to $87,460 in 2025, the highest inflation-adjusted level since Census records began in 1967. Median post-tax household income climbed 3.1% to $76,060. The official poverty rate fell for a third straight year, dropping slightly to 10.2%, or about 34.5 million people. Child poverty fell to a record-low 13.4%, while poverty among Hispanics dropped to an unprecedented 13.9%. State of play: The economy delivered historic topline numbers without spreading the gains evenly. Income among the wealthiest 10% of Americans rose 1.7%, while income among the bottom 10% showed no significant change — indicating that the low-income households largely missed out on the gains. Households at the 90th percentile earned about $261,300, more than 13 times the roughly $20,010 earned at the 10th percentile. The top fifth of households captured 52.4% of all household income. The bottom fifth reported earning just 3%. Zoom in: Latinos offer one of the clearest examples of the split-screen economy in 2025. Hispanic poverty fell to its lowest level since Census began tracking it in 1973. But the median household income among Hispanics, $73,260, showed no significant change from 2024. Meanwhile, 21.8% of Hispanic adults ages 19 to 64 were uninsured in 2025, down a bit from the previous year — but still the highest uninsured rate among the major racial and ethnic groups shown by Census Yes, but: Big racial income gaps remain even as some groups posted gains. Asian American households had the highest median income at $126,300 in 2025, compared with $91,930 for white households and $59,980 for Black American households. Black Americans' household income rose 4.8% from 2024 and whites' household income rose 3%, while Asian Americans' household income showed no significant change. Zoom out: A broader measure of hardship paints a less rosy picture. The Supplemental Poverty Measure, which factors in taxes, government benefits, housing, work and medical expenses, held statistically steady at 13.1% — nearly 3 percentage points above the government's official poverty rate. Medical expenses put an estimated 7.7 million more people below the supplemental poverty line in 2025, the Census Bureau said. Between the lines: Health insurance coverage held steady overall in 2025. The uninsured rate remained statistically unchanged at 7.9%, or 26.7 million people. Medicaid coverage fell 0.5 percentage points nationally, from 17.6% to 17.1% of the population — representing about 1.4 million fewer people with Medicaid coverage in 2025 than in the previous year Among adults ages 19 to 64, 17.3% had public health coverage — including Medicaid, Medicare and VA/CHAMPVA coverage — down 0.5 percentage points from 2024. Census says the decline was driven by a 0.6-point drop in Medicaid coverage among working-age adults. What we're watching: The 2025 numbers may represent the last snapshot before major federal safety-net cuts begin showing up in the Census data, Robert Greenstein, a visiting fellow at the Brookings Institution, tells Axios.

Read it at Axios ↗

← Front page