The price of everything

Simon RoderickResearch, insights & industry news

Ban on salary history questions in interviews

Over the summer break, I read a very interesting book about Winston Churchill – I’m sure most people have at one time or another. Anyway, what fascinated me was that until 1911 MPs were unpaid. I must admit that with my 2018 mindset I had been thinking what a uniform bunch MPs were, and now it’s obvious, as only the independently wealthy needed apply. Your local MP or Lord could also be your employer, magistrate, and head of the yeomanry. Diversity and concentration of power perhaps at its worst.

However, David Lloyd George deserves much credit for being forward thinking enough to introduce pay. It was never supposed to be a salary, ‘it is just an allowance to enable us to open the door to great and honourable public service.’ How much was this allowance? £400. According to the Bank of England inflation calculator, this is about £44,791 in 2017 prices.

This got me thinking about how salaries and prices have changed over the years and so below are some fun examples:

  • The Professional Footballers’ Association say that in 1957 a top England player would have earned a total of a year £1,677 in wages, bonuses and international match fees – the equivalent of about £75,000.
  • The expression ‘oversexed, overpaid and over here’ refers to American soldiers during WW2, who were paid significantly more than their British counterparts. British soldiers received as little as 14 shillings per week, or just under £45 in today’s money.
  • The average annual salary in 1950 was £100, £3,258 in today’s money.
  • Whilst smartphones are affordable for most today, our 60’s counterparts would walk to the phone box at the end of the road. The first mobile handset came out in 1983, priced at £2,300. That’s over £7,000 today.
  • historical prices - salaries - 50sA flight from London to New York would have been the equivalent of £5,412 in 1955. Today, the cheapest route is about £220. But the service has gone downhill somewhat: “We had china, crystal and silver. Passengers were served with Madeira and coffee, then cocktails, then lunch with superb wines,” a flight attendant said. “We followed with afternoon tea of scones, jam and cream and liquors. And then, as we went into New York, champagne and canapés.”
  • The queen’s coronation in 1953 sparked a large increase in the number of tv licenses, and by the 1960’s, nearly three quarters of the population had a tv. A colour tv cost £300 in the late 60’s, equivalent to £4,990 today!
  • Pocket sized calculators became available in the 1970’s, at a price of £70. That’s a whopping £880 in today’s money.
  • In 1950, the Ford Anglia, the cheapest car in Britain, would set you back £310, the equivalent of £9,888 in today’s money
  • Meanwhile, the average house price was £1,940, equivalent to £63,197, and deposits were at 10% of salary. Today, the average is £216,750.
  • …but the average mortgage rate was at 7.1%, compared to 2.87% today. Over two thirds of the nation were renting in the 50’s.
  • historical prices - salaries - 50sFish and chips (had to cover that) cost 25p in 1970, the equivalent of about £3.60 – not too different! Beer taxes, however, have made a pint more expensive today than in the 70’s.
  • A Big Mac started life at 45p in 1974, or £4.90 in today’s money. We’re now down to £2.69.
  • Free higher education dates from 1962, when just over one in ten went to university. Nowadays, the average student leaves with £40,000 in debt.

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