Philly’s income growth has stalled amid high inflation, leaving some stretched thin

If you feel as if your money isn’t going as far as it used to, you aren’t alone.

Income growth has stalled in Philadelphia and the rest of the United States amid the country’s high inflation rate, according to data released last week by the U.S. Census Bureau.

Philly’s median household income dipped slightly last year, to $60,500, down from $62,100 in 2023, after adjusting for inflation. It is the lowest among the 10 most-populous cities in the country. Nationally, median household income is only $700 more than it was in 2019, at $81,600.

Philadelphia had experienced steady growth from 2014 to 2021, but incomes have stayed relatively flat since, while inflation has remained high.

However, Philly no longer holds its unwanted title as the poorest big city in the nation. Houston, with a 21.2% poverty rate in 2024, surpassed Philly’s 19.7%, the city’s lowest rate since at least 1979.

» READ MORE: Philly is no longer the country’s poorest big city

There is some good news in Philly’s declining poverty rate, but citywide data obscure where the changes may really be coming from.

“The change has really been among Philadelphians who are making more,” said Katie Martin, project director for Philadelphia research and policy at the Pew Charitable Trusts.

The organization’s state of the city report, published in April, found that income gains between 2013 and 2023 were smallest for low-income residents, compared with middle- and upper-income residents.

And a new report on Latino poverty published Tuesday by Pew found that while the citywide poverty rate for Latinos in Philly declined over the same period, the number of Latinos living below the poverty line had increased by about 500 residents. At the same time, the number of Latino households making more than $150,000 annually increased more than eightfold, to over 7,300.

For South Philly resident Chris Calmels, calls from debt collectors and pushing bills well past their due date are familiar parts of life.

“I am used to it, but that’s not a good thing,” he said.

Calmels, 32, is a doorman and valet for a luxury condo complex in Center City. He makes $20 an hour, has no health insurance, and shares an apartment with his partner and a roommate. They all live paycheck to paycheck, and finances are a constant stressor.

Calmels drives for Uber and gives cooking lessons to one of his building’s tenants on his days off, but it’s still just enough to get through the month.

“You go to work, you spend 8 to 10 hours a day there … and you’re tired and it’s mental stress, but there’s no real time off from that, because even when you’re home and you’re not working, you’re talking about money and what needs to get paid,” he said.

Calmels’ dog has needed two major surgeries in the last couple of years, and it took a couple of credit cards and a loan from a friend to pay for it all. The dog is doing well now, but takes pills that cost $300 a month.

“I try to ignore things like credit score. Because at this point, it’s shot to hell,” Calmels said.

In Fishtown, it has taken a serious cutdown for Marykate Baffa just to break even on her finances.

The 31-year-old said she has scaled back “to almost the bare minimum of spending.”

She makes about $80,000 a year working as a retail manager and lives in a one-bedroom apartment, and her car is paid off. Still, Baffa said, rising costs have affected her social life. She is more likely now to stay home or visit her family in the suburbs, even though as a single woman, she said, she feels pressure to see friends or meet someone.

A few weeks ago, she met some friends on a Saturday night in Old City. Baffa took a quick Uber both ways, and ordered some chicken fingers, plus three tequila sodas. The next morning, she saw the night had cost her over $100.

“You can’t escape something being super expensive, no matter what you’re doing,” she said.

It wasn’t always this way. When Baffa moved to the city nearly a decade ago, she was making just $35,000, or what would roughly be $46,000 today. But she said she didn’t feel stretched so thin back then, and it seemed like her dollar was worth more.

Residents’ frustrations are supported by census findings that the rise in Philadelphians’ purchasing power, or the increase in wages after accounting for inflation, has lagged behind that of many other large cities. Its growth over the last decade is closest to New York City, where affordability has been a defining factor in its mayoral race.

As frustrating as their financial situations may be, Baffa and Calmels expressed gratitude for what they have.

“I think I have it kind of good. I know a lot of other people that are struggling, way worse,” Calmels said.

While the numbers suggest that conditions have been fairly stable for Philadelphians over the last few years, experts worry policies President Donald Trump’s administration has enacted over the last several months could drive significant economic stress.

“Our unemployment rate has risen a little bit. The hiring rate is down, the quits rate is down. Any one of those three pieces isn’t supremely worrying by itself,” said Claire Kovach, a senior research analyst at the Keystone Research Center. But taken together, they reflect a labor market where workers have less leverage.

“It’s a flashing warning sign,” she said.

Kovach expects the effects of Trump’s tariff policies, federal workforce layoffs, and funding cuts for research and innovation to contribute to a general economic slowdown, too. If that happens, those who are already struggling will be most exposed. Google searches for “help with mortgage” are reaching 2008 housing crisis levels.

“More vulnerable, higher-poverty people … will absolutely take the biggest hit,” Kovach said.