No, we aren't! We have statistics on this (https://fred.stlouisfed.org/series/MEPAINUSA672N). Median real income is up substantially since 40-50 years ago, depending on what you count as a generation. And we have stories and records of what life was like in the 1970s, when 80% of households had to hand wash dishes and 50% had to line-dry clothes. The reason people believe living standards haven't risen since their grandparents' day is that they get false nostalgia bait depictions of how a typical person lived in their grandparents' day.
(What is true, and what I'm sure contributes to the power of the nostalgia bait, is that real income stagnated with the dot-com bubble and didn't hit a sustained rise again until the mid-late 2010s.)
"Real income" is measured against the consumer price index (CPI). CPI is used to gauge inflation, "are people paying more for groceries this year than last?", not living standard. Most of the important questions like "how many years of education do you need for a good job?" or "how many average salaries do you need for a good home?" are all massively worse. So are many metrics of despair.
What real income really shows is that more money now gives you less. That what buys you a loaf of bread doesn't buy you a good life anymore. Because median income might be keeping up with inflation, but not with anything else.
For example your $1000 oled tv is better than your $1000 crt tv therefore you your purchasing power has gone up. Or your base truck now comes with nav therefore your truck can be 5k more and still be net neutral. The problem with this system is that in order to stay in the same price catagory on the index you continually need to move down the product tiers. So today’s lowest tier is a decade ago mid tier is 2 decades ago high end. Moving down like that makes you feel poorer because wealth is relative.
Their expectations might be to live in the top few decile neighborhoods of a metro, where land prices have gone up a few hundred thousand in the previous decade.
It doesn’t matter if the stats say income went up 10% if they or their kids won’t be able to land that house they wanted, or can’t make that appointment with the doctor and instead have to see an NP, or worry about having to move to a more expensive metro to reduce income volatility.
So what gives with your data set? The data set I give covers wages for full time workers. The data set you gave covers all individuals 15+ with any "income", which includes governments benefits. So what you're likely seeing there is going to be, in part, driven by things like an aging population - with a large number of retirees retiring with social security, medicaid, pensions, etc fattening out the middle part of society where income, after all is accounted for, of around $40k sounds just about right. It's mostly unrelated to the change in wages.
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Also, unrelated but I found your examples of 'better life' weird. I still hand wish dishes and line-dry clothes. I know Jeff Bezos and Bill Gates also hand wash their dishes. The "nostalgia" people have is for things like somebody graduating debt free, with a decent car, and ready to put a down payment on the first home - on the back of a part time job that put them through school. That really did happen, but now a days it sounds like a fantasy. I think society would happily trade dish washers for that!
While this chart shows "real" income increases we apparently also see "real" increases on housing, rents, education, etc.
If your inflation metric is only on rolled oats, then it is not really worth much, is it?
While you are correct that real wages are up around 25%, productivity has nearly doubled. While various consumer goods, and technology have seen large improvements - ignoring the measurable and qualitative ways that affording basic aspects of life have become more difficult is not wise.
Global trade as made consumer prices competitive in many things, but those are a big three.
Nostalgia was not at root of my original comment.
This is why many places in the world no longer produce enough food to feed their populations - refrigeration and cheap oil enable food to no longer be a local commodity. Education is sometimes headed in the same direction. But housing cannot be sourced anywhere but locally.
Sorry for hijacking, but this is quite possibly one of the funniest American poverty markers around.
Clothes dryers are a sign of shrinking real estate, not a sign of luxury.
When one lives in a tiny apartment with no balcony, you better have a dryer. When living with plenty of land, it's not a problem to hang clothes to dry in the sun.
My euro family disagrees, even in places that don’t have a balcony. Get the rack out and dry indoors and it’s pretty dry overnight (in the not so humid places).
I have a dryer but avoid it for most clothes because I think it wears them out.
Its nice to have as a last resort or during winter tho.
* https://www.nytimes.com/2025/08/28/opinion/disney-world-econ...
Hey it's iPhone Day, "Stay Hungry Stay Foolish"* ---
*-nevermind the $10000 workstation named after a gf or more recently $2000 orange phones (I bought a DEEP Blue because Apple is always threatening to "Care-Deeply" me), $1000 watches and $300 earpieces for errbody. So Hungry. Also, we'll make sure you never work anywhere in Tech again if you even so much as interview for a new job outside of our company and Non-Competes Are No Longer Blocked! But What the Helly..Turtleneck also didn't invent the hungry mantra which is embraced by many other similar brilliant people, from Einstein to Elon'n-on and of course, my dad's gang one of whom brought Turtleneck back to Apple.) Get it? Got it? Good.
One issue is median real income does not tell you anything about the distribution of income. It can be used to show that the top 50% of people have had “real income growth”, but can hide a lot at both extremes; the poor and rich have had vastly different experiences [1]. The metric on that page looks at “share of national income”, so it has issues as well (not anchored to any objective measures), but it illustrates my point just as well.
The bigger issue I find is the way that “real income” is measured. There are a slew of issues, IMO (hedonic adjustment, for instance), but the biggest is the way that asset prices are treated in CPI - that is to say, they are not! Shelter prices reflect “owner equivalent rent”, not the price to actually buy a home, which has ballooned massively in the last few decades, especially the past five years, relative to income [2]. The same applies to other assets such as stocks; they are nowhere in the CPI metric, but have a direct impact on our lives; higher-priced stocks impeded the purchasing ability of people with respect to stocks, costing them returns over time (couple this with the larger cost of other assets over time and it is clear retirement age will have to go up). So, yes, maybe real income has increased, but substitutions are being made and tricks are being played; more people are renting longer because of home prices. Future returns on investments will be lower because of a giant asset bubble.
Also, future liabilities are nowhere to be seen in the real income metrics. The national debt that the US has saddled its current and future citizens with is shameful and will inevitably cause financial drag in the future (could be higher tax rates, but my personal bet is persistently higher inflation over time; you can already see the Fed giving up on its 2% target).
[1]: https://wid.world/country/usa/
[2]: https://www.visualcapitalist.com/median-house-prices-vs-inco...
You must be looking at some serious equations and related data.
If you were alive back then you would have watched as inflation appeared "out of nowhere" and before long it was obvious that dollars were going to buy less & less each year for the foreseeable future. Government benefits needed to be tied to inflation under emergency conditions or everyone was going to be voted out by millions that were now underwater otherwise.
So they needed something to gauge inflation by and tie benefit dollar increases to, and ended up inventing the CPI.
The CPI was not expected to be very good, just quick. To say expectations were "highly manipulated" would be an understatement. If people didn't settle for something quite deficient in realism to begin with, who knows how many legislative sessions it might take? People could lose everything in that much time.
The exact purpose of CPI was carefully crafted to minimize the appearance of inflation as much as possible and get away with it. It was plain to see as it went along, like any other slow-motion dumpster fire that lawmakers go through when almost none of their intents are entirely honorable.
And CPI just became more laughable ever since.
But that wasn't enough.
Then one day the GDP comes along, with "reasonable" excuses about how multinational American companies are not like they used to be, so good old GNP can no longer act as the best measure going forward.
GDP was even more carefully crafted to minimize the appearance of non-prosperity and inflation, allowing it to run its course under the radar if it could just be brought low enough (but not low enough to be tolerable all the way back when things were really prosperous). Without knowing if that could even be achieved, it was plain to see when overprovisioning was taking place to try and compensate. There's nothing like a long, deep massage of the figures, and "feelings" can improve remarkably if the most obvious pain points are addressed. Temporarily of course.
You will notice that it is never obvious when the overnight transition from GNP to GDP took place. You had to be there. All the old data has been "refactored" creatively as designed in an attempt to make "comparison more valid". Who would benefit or not if people were still able to compare apples to apples, and who makes the rules anyway? By this time after all these years without recovery, "sentiment" was thought to be the only salvation possible, but even the most positive outlook couldn't help consumers who had lost their purchasing power. But a consumer economy was going to be the only road to "recovery", they had to keep spending just to survive regardless of how anemic it was by then.
Anyway the stock market crashes, continuous devaluation of the dollar for years, millions of layoffs, and consumers (millions of who could not afford US-made cars or other products any more) who were increasingly offered foreign alternatives they would readily purchase as much as they can -- all ran their course and it was not enough to end the most ridiculous part of the madness.
There had to be an oil crash and a real estate crash too, before things could finally level out under that old radar beam.
