Americans are earning more than ever—or at least the typical American household is. U.S. median household income reached a record $87,460 in 2025, the highest inflation-adjusted figure in the Census Bureau’s historical series dating to 1967.
That deserves attention.
Yet if you spend your day watching television news or scrolling through social media, you could easily come away believing that virtually everything about the American economy is getting worse.
The actual picture is much more complicated—and in several important respects, much better.
U.S. Median Household Income Reaches a Record
The Census Bureau reported several encouraging economic statistics for 2025:
- Median household income: $87,460
- Increase from 2024: 2.6% after inflation
- Official poverty rate: 10.2%, down 0.5 percentage points
- Child poverty: 13.4%, the lowest official rate on record
- Median earnings for women working full-time year-round: up 3.2%
- Median earnings for men working full-time year-round: no statistically significant change
The female-to-male earnings ratio among full-time, year-round workers also increased from 80.6% in 2024 to 83.9% in 2025.
Those aren’t opinions. They are numbers reported by the U.S. Census Bureau.
And because the household income figure is adjusted for inflation, the increase isn’t simply the result of everything costing more. Real purchasing income, as measured by the Census Bureau, increased.
What Does $87,460 Actually Mean?
It’s important to understand the word median.
Imagine lining up every American household from the lowest income to the highest. The household exactly in the middle represents the median.
Half of households earn more, and half earn less.
That’s different from the average, or mean, income. Average income can be pulled dramatically upward by households earning millions—or even tens of millions—of dollars.
If Jeff Bezos walks into a neighborhood bar, the average net worth of everyone in the bar suddenly becomes enormous. But the typical customer hasn’t become one dollar richer.
That’s why I generally find median income more useful when trying to understand how the typical American household is doing.
This Doesn’t Mean Everyone Is Doing Well
We should also resist making the opposite mistake.
A record U.S. median household income doesn’t mean every American is prospering.
There were still 34.5 million Americans living below the official poverty line in 2025. Housing remains expensive in many cities. Health care, insurance, food, education and other expenses can put significant pressure on families even when their incomes are rising. At the same time, let’s not forget that poverty is optional in the U.S. Any family who takes personal responsability, has the means to get out of poverty.
And there’s another important detail in the Census report.
Income at the 90th percentile increased 1.7% in 2025, while income at the 10th percentile did not change significantly. No because the system failed, but because those people didn’t change with the times.
So this isn’t a story in which everyone benefited equally. And such is life, some people want to improve themselves, while others don’t make any effort.
But acknowledging that some people negleted to take advantage of the opportunities given to them shouldn’t require ignoring positive developments either.
Both things can be true.
Millions of Americans can face serious financial difficulties while, at the same time, the median American household reaches its highest inflation-adjusted income on record.
Why Doesn’t Good Economic News Feel Like News?
This is the part I find fascinating.
Turn on television news for an hour and count the positive stories versus the negative ones.
Layoffs are news.
Bankruptcies are news.
A company closing a factory is news.
A family unable to afford its mortgage is news.
But what about someone who gets a better job and earns 8% more than last year?
Probably not news.
A company quietly hiring another 200 employees rarely receives the same attention as a company firing 200 employees.
Why?
Bad News Gets Our Attention
One explanation has nothing to do with politics.
Human beings simply pay more attention to negative information.
A large study published in Nature Human Behaviour examined roughly 105,000 variations of online news stories generating approximately 5.7 million clicks from more than 370 million impressions.
Researchers found that negative language increased people’s likelihood of clicking.
For a headline of average length, adding one negative word increased the click-through rate by about 2.3%.
Think about the incentive this creates.
Media companies compete for our attention. Television networks want viewers. Websites want clicks. YouTubers want views. Social-media platforms want engagement.
If fear, anger and outrage attract more attention than “things are gradually improving,” publishers have a financial incentive to emphasize the former.
The media may not necessarily be giving us the world as it is.
It may partly be giving us the version of the world we’re most likely to click on.
Then There Is Politics
There is another possible influence: partisan framing.
Economic statistics inevitably become political because voters partly judge presidents and political parties by economic conditions.
Donald Trump was president during 2025, so Republicans have an incentive to emphasize statistics showing improvement. Democrats have incentives to emphasize statistics showing economic difficulties or areas where gains have been uneven.
The reverse incentive can exist when a Democrat occupies the White House.
Academic research has found evidence that partisan orientation can affect the intensity with which some media organizations cover good and bad economic developments.
That doesn’t mean every journalist is secretly manipulating the news. Nor does it establish that unfavorable coverage of the 2025 economy is politically motivated.
It does mean that consumers should recognize that story selection itself can influence our perception of reality.
A news organization doesn’t necessarily need to publish false information to create a distorted picture. The New York Times has been suspected of having a WOKE bias, not by lying, but by the way they frame the news.
It can publish ten true negative stories and ignore ten true positive stories.
Every individual story could be accurate while the overall impression remains incomplete.
Give Trump Credit—but Keep the Numbers in Perspective
Because the record occurred during President Trump’s administration, his supporters will understandably point to the $87,460 figure as evidence of economic success.
Critics will reasonably point out that presidents inherit economies shaped by previous administrations, Federal Reserve decisions, technological change, business investment, global economic conditions and millions of decisions made by workers and companies.
Both considerations matter.
Presidents influence taxes, regulation, trade, spending and other policies. But no president personally controls household income.
The most defensible statement is therefore also the simplest:
During Trump’s presidency in 2025, real median household income reached the highest level recorded in the Census Bureau’s series dating to 1967.
How much credit Trump deserves is a separate political and economic question.
Poverty Fell Too
Household income wasn’t the only encouraging number.
The official poverty rate declined from 10.7% in 2024 to 10.2% in 2025, representing 34.5 million people.
Even more striking, the official child poverty rate fell to 13.4%—a historic low.
There is an important caveat.
The Census Bureau also publishes the Supplemental Poverty Measure, which incorporates taxes, government benefits, medical expenses, work expenses and geographic differences in housing costs.
That measure stood at 13.1% in 2025 and was not statistically different from 2024.
Once again, reality is more nuanced than either “everything is wonderful” or “everything is terrible.”
Stop Letting Headlines Tell You How the Economy Is Doing
This may be the biggest lesson.
We increasingly experience the economy through anecdotes.
Someone posts that she has been unemployed for six months.
Someone else posts a photo of a $14 sandwich.
Another person says his rent increased 20%.
Those experiences are real and shouldn’t be dismissed.
But anecdotes aren’t economic statistics.
For every person posting about losing a job, there may be someone quietly getting hired. For every struggling business owner, another entrepreneur may be having the best year of her career.
The successful person often isn’t newsworthy.
The disaster is.
The Economy Is Not a Feeling
There is nothing wrong with acknowledging good news.
Doing so doesn’t mean ignoring poverty, expensive housing, government debt, inequality or people struggling to make ends meet.
It simply means looking at the complete picture.
In 2025, U.S. median household income reached $87,460—the highest inflation-adjusted level recorded in the Census Bureau series going back to 1967.
The official poverty rate declined.
Official child poverty reached a record low.
Women’s median earnings among full-time, year-round workers increased.
Those facts deserve to be part of our understanding of the economy just as much as layoffs, bankruptcies and financial hardship.
Maybe the American economy isn’t perfect.
No economy ever is.
But perhaps it’s doing better than your social-media feed wants you to believe.
Frequently Asked Questions
What was U.S. median household income in 2025?
Real U.S. median household income was $87,460 in 2025, according to the U.S. Census Bureau. That represents a 2.6% increase from $85,210 in 2024 after adjusting for inflation.
Was $87,460 a record?
Yes. According to the Census Bureau, the 2025 figure was the highest real median household income recorded in its historical series dating to 1967.
Did poverty decline in 2025?
Yes. The official U.S. poverty rate declined by 0.5 percentage points to 10.2%. The official child poverty rate fell to a historic low of 13.4%. However, the Supplemental Poverty Measure was 13.1% and did not change significantly from 2024.
Did household income rise because of inflation?
No. The Census Bureau’s $87,460 figure is expressed in inflation-adjusted dollars. The reported 2.6% increase therefore represents growth in real median household income rather than merely higher nominal wages caused by inflation
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