Two sentences, both true, from the same Census Bureau report. Median inflation-adjusted household income rose 2.6% in 2025 to a record $87,460. And real pre-tax income for the bottom tenth of earners has risen $110 — total, cumulatively — since 2019.
That is the gap between a statistic and an experience, and it is worth taking apart carefully, because this is the number that will be quoted at you from both directions for the next month.
What genuinely improved
Quite a lot, and it should be said plainly. Incomes for most Americans have surpassed pre-pandemic levels in real terms. The overall rise drove the poverty rate to a historic low of 10.2%. Childhood poverty declined a full percentage point to 13.4%.
The supplemental poverty rate — which accounts for transfer payments and geographic differences in housing costs — stayed roughly flat at 13.1%, but largely because higher earnings reduced the need for welfare. That is the right reason for that number to stay put.
How the gain was earned
Here the texture matters. Americans worked more. The number of men working full-time grew by 1.3 million and the number of women by 800,000 — but the total number of workers rose by far less, roughly 230,000 men and 130,000 women.
Subtract one from the other and you get the real mechanism: part-time workers moved to full-time, adding hours. The Journal’s editorial page offers the likely reason — wages weren’t keeping pace with inflation, so people worked more to stand still.
A rising median that comes from more hours rather than higher pay feels different from the inside. That is most of the answer to why the sentiment surveys and the income data keep disagreeing.
The composition shifted too. Median earnings for full-time male workers fell $690, while rising $1,900 for full-time female workers — narrowing the gender pay gap, though falling male earnings is a poor way to achieve it. The likely culprit: a slowing manufacturing labor market alongside continued strength in services.
The distribution, which is the story
Since 2019, real pre-tax incomes rose 0.6% — $110 — for the bottom 10th percentile, against 3% ($5,400) at the 80th and 5.6% ($18,700) at the 95th. And that data excludes capital gains, which have mostly benefited higher earners holding assets in taxable accounts rather than in tax-sheltered retirement accounts.
Taxes and transfers compress this considerably: households at the 95th percentile paid an average of $85,700 in income and payroll tax, while those at the 10th percentile gained $130 net from tax credits. Add Medicaid and other transfers and the gap narrows further.
But the pre-tax picture is the one that shapes how people feel about their own progress, and for a large share of Americans real income has been roughly flat since the pandemic. As the editorial notes, persistent inflation is the biggest culprit.
Two footnotes worth keeping
One caveat cuts against the headline: deportations may have inflated the median by reducing the number of lower-wage workers. The Census Bureau reported a 10.6% decline — about one million — in workers with no high school diploma. Remove low earners from a sample and the median rises without anyone getting a raise.
And one finding worth sitting with: the number of workers with a college degree or higher rose by 1.8 million last year while their median earnings declined 1.1%. Earnings for high-school graduates rose 5.5%. Supply and demand, applied to credentials.
The household takeaway
National medians are almost useless for personal planning, and this report is a good demonstration of why. What is useful is running your own version: what your real income has done over six years, after inflation, and whether the increase came from a raise or from more hours.
That second question is the one that decides whether a plan is sustainable, because hours are finite in a way that income isn’t. Fifteen minutes and last year’s tax return will tell you which one you’ve been living on.