The rising costs of living don’t appear to be going away any time soon, based on the latest inflation report. And for Black American households, the strain is most felt as a new Federal Reserve analysis found that their income and net worth are shrinking.
According to the Bureau of Labor Statistics’ latest Consumer Price Index report, inflation rose 3.7% year over year, up from the previous month. What’s more, the Federal Reserve Bank released its 2025 Survey of Consumer Finances. The annual report found that the Black household median and mean incomes decreased from 2022 to 2025, and Black net worth dropped by 25%, which is nine times lower than the net worth of white households.
Gbenga Ajilore, chief economist at the Center on Budget and Policy Priorities, tells theGrio that the Fed report shows that in 2022, under the presidency of Joe Biden, Black households saw gains in wealth.
“What determines wealth is housing, and that’s where Black people have their wealth,” Ajilore explained.
He continued, “Then you look at other groups who have higher wealth; they have more asset diversification. So you think about the stock market. Over the last couple of years, the stock market has really peaked, and so all these other groups are benefiting from that stock market increase, and Black households aren’t.”
Ajilore noted that while retail sales and consumer spending are rising despite an affordability crisis, it’s likely the result of households drawing down their savings or taking on long-term debt, including through financial services like buy now, pay later. Another factor in the shrinking of Black wealth is likely connected to the lack of Black business ownership, says the economist.
Critics of the latest data illuminating the economic barriers for Black Americans point to the policies of President Donald Trump and Republicans in Congress.
“Black families have spent generations building wealth in a country that historically has made it harder for them at every turn, and now they’re watching a quarter of it disappear while Donald Trump raises prices on everything and guts Medicaid and SNAP to bankroll tax breaks for the wealthiest Americans,” says Brandon Weathersby, spokesperson for American Bridge 21st Century, a liberal policy research firm.
He told theGrio, Black families are already being squeezed from every side, and Trump’s agenda is tightening the vise.”
Alphonso David, president and CEO of the Global Black Economic Forum, called out Trump’s cuts to DEI programs and other services aimed at addressing racial disparities.
“The idea that Black families have somehow been given too much opportunity is simply false,” David told theGrio. “Yet we are being told that the programs designed to address these disparities are the problem. How do you justify taking away the very tools that help families build economic security when the need for them is this clear?”
Nadine Smith, president and CEO of Color Of Change, told theGrio, “Families across America are struggling, and Black families are bearing the brunt of an economy that makes billionaires richer by keeping working people underpaid and insecure.”
Nodding to the Black unemployment rate’s continued rise, Smith added, “Higher unemployment and lower wages leave Black households with less to live on as prices rise.”
“You cannot budget your way out of a paycheck that doesn’t cover the bills. Corporations use the wealth workers create to keep wages low and the rules in their favor,” said Smith. She added, “Lawmakers must strengthen workers’ power to demand fair pay and make billionaires and corporations pay their fair share for the public services we all depend on. Working families deserve economic security and a fair share of the wealth their labor creates.”
Ajilore told theGrio that Black households and Americans more broadly can expect to see inflation get worse before it gets better. As a result of Trump’s war in Iran and the widening conflicts in the Middle East, food and energy prices are volatile.
“The thing about the war is that it’s not just gas prices, but diesel prices, fertilizer–a lot of inputs that go through a lot of goods,” Ajilore explained.
The economist said he expects higher diesel prices, which spiked during the summer, to continue to climb by the year’s end.
“We actually haven’t seen the impact of the higher diesel prices throughout the economy yet. So I expect to see that towards the fall and winter,” he said.
