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More (not so) fun facts:
54% of American adults read below a 6th grade level.
21% read below a 5th grade level, which is considered functionally illiterate.
High immigration numbers don't fully explain it either, as first gen immigrants only make up about 1/3 of those with low literacy.
This seems to be hard to tell from the data. While the others are right that there have been recent downward movement, the country is old and we don't have data going back very far.
basic literacy has almost certainly increased (meaning one can write a sentence about onesself, and read it). The large majority of Americans meet this bar (and the rest are children or quite old/sick), while only ~80% met this bar 100 years ago.
But it seems we haven't kept data on reading level for very long. The wikipedia page is pretty good afaict. I suspect what actually matters for democracy and such is the literacy rate of voters, though I haven't seen great data on it. We know a large share of folks don't vote, I would guess this correlates very strongly with literacy.
Also, there's a relevant confounder here (which the wikipedia page highlights): one can be american and not speak english, but still be literate in their childhood language.