Tag Archives: cuts

The Great Depression of 1979 to 1981


Anybody over 50 years of age who lived in the Midlands or North of England and Scotland after 1979 will remember the economic depression that ravaged the industrial heartlands. I went to university in Liverpool in 1981 just after a summer of riots in that city and can recall well the sight of closed factories and decaying docks.

So – what on earth happened at that time? Up until Margaret Thatcher took over in 1979, unemployment had actually been falling for two years. Inflation had been brought to under 10%. Industrial output was finally ticking up as were living standards. The middle of the 70s had been disastrous. The Labour government of James Callaghan had to grovel to the International Monetary Fund for a bail out. But by the end of the decade, the economic indicators were improving. Plus oil from the North Sea was about to provide a bonanza.

However – Thatcher played to a sense that the post-war political consensus had run into the buffers. Even if the economics looked more favourable, the political and social environment in Britain was very volatile. Many people were fed up and looking for decisive leadership. And so Thatcher was elected. Unfortunately, she came into power wedded to what Labour Chancellor of the Exchequer Denis Healey described as “voodoo economics”.

Pursuing a monetarist economic policy turned a global recession into a British depression. Our unemployment sky-rocketed from 1979 to 1981 from about a million to three million – and that was the official statistics. Those stats were constantly revised in the 80s to massage them downwards.

Big rises in interest rates, indirect taxation (VAT), the exchange rate and cuts in public spending depressed demand and accelerated factory closures and bankruptcies. Every evening, the TV broadcast news would announce thousands of job cuts and names of firms now facing closure. These included household name brands and affected all sectors.

I got used to reciting the figures as a young political activist at that time. Manufacturing jobs slid by 22%. In vehicle production, jobs crashed by 28% – nearly a third of those in work. Young people were disproportionately affected with under-25s making up 40% of the jobless total. Two out of every three school leavers couldn’t find work. As the recession continued, it became clear that the number of long-term unemployed was increasing at an alarming rate. Many who had worked in blue-collar manufacturing, mining and dock work were stuck on the dole.

The incredible cost of this level of unemployment was around £17bn in benefits and lost tax revenues. I’d have to calculate the real cost in today’s money. That is a 1981 figure. It didn’t make economic sense. But it made political sense. For Thatcher, inflation was the real demon and fear of losing your job was a weapon against the power of the trades unions.

Political badges from the 1980s


Emptying out my parents’ attic as they downsize, I opened a tatty plastic bag and out fell a load of political badges from the 1980s. These were worn with pride on my lapels at various demos back in the day. They date from about 1979, when I’d have been 16 years old through to around 1984 and the miners’ strike. As a snapshot of what we fought, cared and fretted about – they’re truly fascinating. And the language now seems a bit dated on some of them.

Badges of the 80sBadges of the 80sBadges of the 80sBadges of the 80sBadges of the 80s Take a look at the photos below and I’ll just chat through some of them. Nuclear arms – big obsessions. There were surveys at that time where most young people honestly believed there would be a nuclear catastrophe in their lifetime. Remember we had the Soviet Union versus Uncle Sam and in 1981, I went on the massive CND demo to Hyde Park. I remember one old dear screaming at me that I was as bad as those Hitler loving pacifists in the 1930s Peace Pledge Union. Another big demo that year was the People’s March for Jobs and you can see a big badge there for that.

The 1981 Brixton riots put the focus on the SUS laws – stop and search by police, which impacted on black kids a lot more than white. And it’s still an issue today – how depressing!  The anti-racist badge saying “will you choose to abuse” seems a bit patronising and corny now – your views? Note the brilliant badge with Home Secretary William Whitelaw and his detergent that would whitewash police tactics over Brixton – still think that’s amusing.

On the global front – you had Chile under the Pinochet dictatorship and of course we all know how much Thatcher liked him. There’s also a Polish Solidarnosc badge as the movement against Stalinism in that country took hold – then faltered. Spain had emerged from the Franco dictatorship and the socialist party – the PSOE – was about to take power. Though the promised socialist revolution never materialised.

Rhodesia gave way to Zimbabwe at the end of the 70s and you can see a badge there. Ireland and the ‘Troubles’ were a constant feature with bombings in the north and on the mainland UK. In 1979, Lord Mountbatten was blown up. Thank goodness that all seems like ancient history now.

Above all else – there was a visceral hatred of Thatcher. When I watch all these 80s progs saying we were all yuppies in that decade, it makes me furious. Nobody who was there would recognise that narrative. We were heavily polarised as a country. You either loved Maggie or hated her – and your style of dress and badges reflected that.