We've got recession, strikes and snow, but not the prices to match, more's the pity...
OK, so things aren’t really as bad as they were in the 70s (yet), but there certainly some parallels. We’ve got a serious recession on our hands, with some manufacturers stopping production for months and we have strikes – all of which were features of the 1970s.
It's a shame that we don’t have a cost of living to match, but not the double digit inflation of course. The startling fact is that since 1971, the cost of buying stuff has risen by 967% - in other words, what might have cost £5 in 1971, would cost just over £53 today (Just Google ‘historical inflation calculator' to see for yourself). So, just for the sake of it, I wonder how rolling back that inflation (which is of course impossible in reality) would affect the cost of living today:
Here’s how the major household expenses (based on government categories) would be affected:
1. Transport.
The average household weekly spend on transport in 2007 was £62. That includes everything from bus tickets to buying cars and petrol. In 1971, that £62 would have been just £6. That would barely cover a tube ticket today.
2. Recreation and culture.
In 2007, we spent an average of £57 per week on things like holidays, cinema trips, sports activities and gambling. At 1971 prices, that would cost around £6 again – probably about the price of a large bucket of popcorn today.
3. Housing, fuel and power.
£52 per week in 2007, £5 per week in 1971. Obviously that includes expenses like mortgage payments, rent and energy bills. Oh how times have changed.
4. Food and drink:
In 2007, we spent £54 per week (I must admit I find that hard to believe, looking at my own till receipts, but still). Thirty-eight years ago that would have cost a mere fiver. Oh and over two thirds of the money we spend on food goes to the big supermarkets – so much for the nation of shopkeepers.
5. Restaurants and hotels:
Weekly cost in 2007? £37. In 1971 that would have cost about £4, but then I doubt we would have used them as much in those days anyway.
6. Clothing and footwear:
Despite our collective obsession with labels and fashion, we only spent £22 per week on clothes in 2007. Imagine how svelte we would all look if that still only set us back £2. Then again, we’d probably have to be clad head to toe in denim, so maybe £22 is a price worth paying.
7. Communication.
Presumably this means telephones, mobiles, broadband and the like. Well, we spent an average of £12 a week on this kind of thing in 2007, which is equivalent to £1 in 1971 (OK, OK so we didn’t have mobiles and broadband back then, but that’s not really the point)
8. Everything else.
This includes things like education and health, insurance and whatever else we spend our money on. Anyway, in 2007, these miscellaneous items cost a whopping £128 per week. In 1971, you’d have got the lot for £13. So in 2007, the total average household spend per week was a little under £460. Ouch. If we were to enter some kind of weird price time-warp that would come down to a total of about £46 per week.
Meanwhile, the latest research shows that the average household income in 2006 was about £650. Given the perilous state of our savings, you have to wonder where the extra £210 per week went (We only spent £460 of it remember).
Whichever way you look at it though, that time warp is looking rather appealing. We’ve already got the strikes and the recession, so to earn £650 a week and spend only £46 of it would make it all worthwhile.
It’s never going to happen of course, but it’s a nice dream.
