Americans got a raise in 2023.
Median household income in the U.S. rose to $80,610 in 2023, according to U.S. Census Bureau estimates. That’s a 4% increase from the $77,540 median in 2022. It’s the first statistically significant increase since 2019, the Bureau reports.
The gains weren’t across the board, however. White and non-Hispanic white households were the only racial or Hispanic-origin groups whose incomes rose significantly, growing by 5.4% and 5.7%, respectively.
While Black and Hispanic household incomes did increase, they only grew by 2.8% and 0.4% from 2022 to 2023. The median income among Black households rose from $54,960 in 2022 to $56,490 in 2023. Hispanic households went from earning a median of $65,300 to $65,540.
Asian households saw a very slight decline (0.2%) in median income, but still earned the most — $112,800 in 2023 — of any race or Hispanic-origin group.
Racial and gender pay gaps persist
The gap between Asian and white non-Hispanic household earnings shrank slightly between 2022 and 2023, while the gap between white non-Hispanic and Hispanic household incomes grew. The Black-white earnings gap was mostly unchanged over this time, according to the Bureau.
On top of racial earnings gaps, the wealth gaps between Black and Hispanic families compared with white ones has continued to grow. The gap between Black and white household wealth grew by 26% and the Hispanic-to-white wealth gap grew by 27% between 2019 and 2022, the latest available Federal Reserve data shows.
White households had a median net worth of about $285,000 in 2022. That figure drops to about $62,000 for Hispanic households and to about $45,000 among Black households in 2022, according to the Fed.
The gender pay gap also grew in 2023 after two decades of slow shrinking and stagnation, the Census reports. Among full-time year-round workers, men saw their earnings grow by 3% between 2022 and 2023 while women’s earnings rose by just 1.5%. Male full-time workers earned a median of $66,790 in 2023, compared with $55,240 for female workers.
In addition to being systemically undervalued and underpaid, women dominate low-wage occupations, such as those in service and hospitality, which may help explain why the broader wage gap persists. Women make up two-thirds of the lowest-paid U.S. workforce, according to the National Women’s Law Center.
Further, households in the 90th percentile by income saw their earnings increase by 4.6% from 2022 to 2023, while the highest-earning 10th percentile’s wages grew by 6.7%, per the Census Bureau.
Wages heat up while inflation cools
The news that households are earning more comes as year-over-year inflation cooled to its lowest point since 2021, according to the Bureau of Labor Statistics. Prices for consumer goods rose just 2.5% in August 2024 from the previous year.
While prices are still cumulatively 21% higher than the beginning of the pandemic, wages have grown 23% over the same period, according to a ZipRecruiter analysis.
“Positive wage gains are expanding Americans’ purchasing power and fueling rock-steady growth in real consumer spending,” Julia Pollak, chief economist at ZipRecruiter, says. “The sustained strength of U.S. consumer spending has fueled overall economic growth and boosted the labor market.”
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