U.S. Poverty Rate Drops to Record Low in 2025

The Census Bureau announced on Tuesday that the U.S. poverty rate decreased to its lowest recorded level in 2025, while median household income reached an all-time high. The official poverty rate fell by 0.5 percentage points to 10.2%, which translates to about 34.5 million individuals living in poverty. This marks the second consecutive annual decline and is the lowest rate since the agency began monitoring these statistics. On the other hand, median household income increased by 2.6%, reaching $87,460, the highest since 1967.

The White House celebrated these figures, highlighting that they represent the first year of President Donald Trump’s second term.

In a statement, the administration claimed, “President Trump’s proven economic agenda delivered historic working-class prosperity in his first year back in office, with record-high real income and record-low poverty—surpassing the records he established during his first term.”

Treasury Secretary Scott Bessent also praised the report while testifying before a House committee. He referred to the data as “several inconvenient facts” for the administration’s political rivals.

“Real wages are outpacing inflation,” Bessent mentioned during his testimony to the House Financial Services Committee. “The bottom 25 percent of wage earners are experiencing larger wage increases compared to those at the top.”

Additionally, the Census Bureau stated that the poverty rate for children fell to a historic low of 13.4%, and the rate for Hispanic Americans dropped to 13.9%. Between 2024 and 2025, median income grew by 4.8% for black households and 3.0% for white households, with little change reported for Asian and Hispanic households.

The supplemental poverty measure held steady at 13.1%, considering non-cash government benefits and taxes. The report also indicated that 26.7 million individuals, or 7.9% of the population, lacked health coverage at some stage during 2025. This figure remained relatively unchanged from the previous year and is near historic lows.

Some Democratic figures argued that the report does not account for the effects of spending cuts initiated by Republicans. Sharon Parrott, president of the left-leaning Center on Budget and Policy Priorities, warned that cuts to safety-net programs could undo the progress made.

“These cuts are already stripping food assistance and health care from millions who need support, increasing poverty and hardship,” Parrott stated.

It is worth noting that the data released covers 2025, the first year of Trump’s second term, and does not reflect the impacts of Medicaid and food-stamp reductions from the One Big Beautiful Bill, which was signed into law in July 2025.