The Great Inflation: Government Policy in the 1970s and the Impact on Women

Unemployment and inflation were the twin bogeymen of the post war world. In Germany, with their memories of hyperinflation in the Weimar Republic – when people took their salaries home in wheelbarrows – inflation was the worst fear. In Britain, the memories of the Jarrow marches and hunger in the 1930s, meant that unemployment was our greater horror.

In the 1970s, when both inflation and unemployment became prevalent in the UK, the British oscillated between which they thought was the greater problem (1). In September 1974, 82% agreed that inflation was an important issue facing Britain, compared with only 9% agreeing that unemployment was greater. It took another 11 years – to September 1985 – before these figures had completely reversed with 83% by then agreeing that unemployment was an important issue, compared with 10% naming inflation. During that period, voting intentions switched between parties depending on whether the public felt that Labour or the Conservatives could deal with inflation better. Initially it was Labour, with its idea of a ‘Social Contract’ with the unions – leading to Harold Wilson’s Labour government in February 1974 and Jim Callaghan’s from 1976. But then the disillusionment of the Winter of Discontent (1978/79) led to Mrs. Thatcher and the Conservatives being swept to power in 1979 with promises to ‘fix’ inflation via the ‘new’ monetarist policies.

The tables from MORI and NOP Polls at the time demonstrate the switch that happened over the Winter of Discontent as Labour’s policies were finally rejected by the public (2).

Inflation changes society
The 1970s saw huge global spikes in inflation triggered by the tripling of the price of oil in 1973, due to OPEC shutting down supplies; the world was more dependent on oil in the 1970s than it is today.  In the UK, Trade Unions and strikes drove high pay rises, fuelling inflation; on the other side of the coin, demographic trends (the baby boomers growing up) meant a growing working population, which led to stronger demand. This also increased inflation – but (in time) led to greater investment confidence and eventually the popularity of monetarist policies of the 1980s. Monetarists believed that controlling the supply of money was the way to end inflation. They raised interest rates and made spending cuts. Nevertheless, inflation had become well entrenched and was not beaten until the mid-1980s.

The experts say that things were different in the 1970s relative to today, when unemployment is low, unions are weaker and wages are not increasing fast. They predict that inflation will soon be brought down. But different conditions only mean possibly different outcomes, and not necessarily that the opposite result will obtain.

Inflation is a grim business for society in that it drives inequality, affecting those on lower wages more than those on higher pay. At the end of the decade, in 1979, prices were, on average, triple what they had been in 1970. Beer had increased from 11p to 37p a pint. Cigarettes had fared slightly better: a pack of 20 king size rising from 30p to 66p. But the average electricity bill had gone from £11 to £40, food from £6.68 per week to £25, a tank of petrol from £1.73 to £6.32 and new mortgage payments from £19.90 to £118.95. The only good news was that colour TVs, which cost £260 each in 1970, were still only £260 in 1979 (3). No wonder the inflation of the 1970s is now referred to as ‘The Great Inflation’.

Initially the main effect was on inequality – the worse off were affected more than the better off. In 1975 NOP reported, “There seems to be a major split in responses at a family income level of £2,500. Those above £2,500 were less likely to feel worse off than those below £2,500. The national average family income according to the most recent Department of the Environment figures, is £2,570. (Family Expenditure Survey 1973). Clearly inflation seems to be hitting those whose family income is below the national average. Those above the national average seem to be quite capable of keeping pace with inflation and in relative terms many seem to be ‘profiting’ out of the inflationary spiral.”(4)

But by May 1977 even the better off were feeling the pinch and 54% of all households were feeling worse off. The NOP Review of the month reported, “In 1975 62% of the AB social class thought that wages had kept up with prices; by May 1977 this proportion had fallen to 17%. Therefore, the gap which was so apparent between the attitudes of the better and worse off in 1975 has now narrowed into insignificance”. (5)

Inflation and the housewife
In September 1975 a Times headline announced, “Poorest wives are getting poorer”. Husbands pass on less than half their pay rises to their wives for housekeeping, according to a survey of 4,000 readers of Woman’s Own. One mother in five had no increase in a year of 25 per cent inflation, the survey shows. One in three of the poorest wives on £10 a week or less had no increase in her housekeeping allowance. Two wives in five find it difficult to keep up with food prices. (6)

Inflation was a particularly miserable business for the housewife, who was perhaps the most affected of all groups in society. Remember that at this time most women with children did not work outside the home. These mothers were trying to make ends meet when prices were increasing rapidly every week: ‘’The increases are large, not 1p but last week flour had gone up 6p!” (8). Imagine yourself in her situation: your husband is not passing on the pay-increases won by his union, you’ve three children (and the husband) all expecting a meal to be on the table when they get in every night. You don’t mind doing without (after all your husband does bring home the money) but you do wish they would show a little more appreciation. You’re becoming dissatisfied with your lot – you crave a job and financial independence. You think you’ll get a job as soon as the children are older, save some money for yourself, go on holiday again, and get your hair done every week, like before…

CRAM International conducted qualitative studies on the effect of inflation on housewives in 1974 (7, 8) – just as inflation was reaching its peak (25% in 1975) and showed that many were struggling. In many ways living in the 1970s was very different from today: women had ‘housekeeping budgets’, families still sat down to meals together, husbands didn’t participate much in household tasks or looking after the children. But there is one very common theme which still resonates today – women ‘doing without’ in order that their husbands and children should not suffer.

Female self-sacrifice is a constant in society when times are difficult.

Longer-term effects on society and women
The 1970s was the decade when much of the work done by feminism in the 1960s came to fruition and changed things for women. Remember that the Equal Pay Act was only passed in 1970, and it was 1975 before the Sex Discrimination Act made it illegal to discriminate against women in employment, education, and training and gave women the right to maternity pay. And only in 1974, with the passing of the Equal Credit Opportunity Act, did it become illegal for banks to refuse loans and credit to unmarried women (or require a husband’s permission for married applicants). Before then, it was almost impossible for a single woman to get a mortgage.

And we see, with the benefit of hindsight, that women did seize their chance to escape the drudgery of housewifery – they did go out to work in increasing numbers. In the following decades, female employment rose 5.8 million while male employment increased by only 1.3m (ONS). The banks did finally offer financial services to women and manufacturers developed products to lessen the load of domestic work, such as convenience food, continental quilts, better kitchens and household appliances. You can almost conclude that the inflation of 1974/5 was the beginning of the end for the role of housewife – but only the beginning – there is still (even 50 years later) quite a long way to go.

1: Market & Opinion Research International Limited (MORI), (2005). MORI Political Monitor, October 2005. Archive of Market and Social Research amsr.org.uk, Cat. no. MOR14

2: National Opinion polls Ltd, (1979). NOP Political, Social, Economic Review Issue no.18 1979 March. Archive of Market and Social Research amsr.org.uk, Cat. no. NOR18

3: Howard, Harry (2022). Available from: How the 1970s inflation crisis only came to an end when interest rates hit 17 per cent | Daily Mail Online (Accessed on 20 March 2023)

4: National Opinion polls Ltd, (1975). NOP Political Bulletin 1975 February. Archive of Market and Social Research amsr.org.uk, Cat. no. NOR274

5: National Opinion Polls Ltd, (1977). NOP Political, Social, Economic Review Issue no.10 1977 May. Archive of Market and Social Research amsr.org.uk, Cat. no. NOR10

6: National Opinion Polls Ltd, (1975). NOP Political, Social, Economic Review 1975 November . Archive of Market and Social Research amsr.org.uk, Cat. no. NOR278

7: Cooper Research and Marketing. (1974). Interim report: housewives’ responses to changes in their budgets. Archive of Market and Social Research amsr.org.uk, Cat. no. CRAMA254

8: Cooper Research and Marketing. (1974). CRAM qualitative monthly Prospect – April 1974. Archive of Market and Social Research amsr.org.uk, Cat. no. CRAMA300B