American household income reached above pre-pandemic levels for the first time last year, a sign of the income constraints and purchasing power of Americans over the past five years due to rising prices.
Increase in Household Income
The average American household income increased by 2.6 percent in 2025 compared to the previous year, reaching $87,460. This figure is the highest recorded, with household income in 2019 being $85,320.
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This data indicates that despite rising prices, household income is now higher than before the pandemic. However, this small increase over a six-year period explains the general negative sentiment among Americans regarding the economy since the outbreak of the COVID-19 virus in early 2020. Concerns about expenses have become a significant issue in the upcoming midterm elections.
Trends in Household Income
According to census data, household income has increased by 2.5 percent since 2019. In contrast, during the previous six-year period from 2013 to 2019, which was characterized by very low inflation and declining unemployment, household income increased by 19 percent.
The census report also indicated that women's wages increased by 3.2 percent last year, while men's wages slightly decreased. This significant increase for women has reduced the gender pay gap, although it remains large, with women earning an average of 84 cents for every dollar earned by men, up from less than 81 cents in 2024.
This data can be seen as indicators of changes in the labor market and the economic impacts resulting from the pandemic. Despite these increases, many Americans remain concerned about their purchasing power, highlighting the challenges that the government and policymakers will face in the future.
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Source: abcnews.com
